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Section 2(23) of the Income-tax Act, 1961 - Firm -Definition of - Assessment year 1986-87 - Consequent to grant of liquor licence to an individual he constituted a registered firm and carried on business on basis of said licence - Application for registration of firm and continuation thereof was declined by Assessing Officer - However, Tribunal allowed application - Whether in view of Supreme Court decision in Biharilal Jaiswal v. CIT [1996] 217 ITR 746/84 Taxman 236 (SC) revenue's application under section 256(2) was to be accepted - Held, yes FACTS A licence under the M.P. Excise Act was granted in an individual name. However, the licensee constituted a registered firm with some more persons and carried on business on the basis of the said licence. Later on, he applied for registration of the firm and continuation thereof which was rejected by the Assessing authority. However, on appeal, the Commissioner reversed the order of the Assessing authority which was upheld by the Tribunal. The Tribunal also rejected the applicant's prayer made under section 256(1). On reference, the applicant contended that the Tribunal had declined the prayer mainly on the basis of the decision of the High Court in the same matter pertaining to previous assessment years and that order was the subject-matter before the Supreme Court. The applicant also cited a Supreme Court decision in Biharilal Jaiswal v. CIT [1996] 217 ITR 746/ 84 Taxman 236. HELD Considering the decision in Biharilal Jaisawal's case (supra ) it was deemed to be proper to call a reference from the Tribunal for resolution of the said question. Accordingly, the Tribunal was to be directed to refer the question to be answered by the High Court. CASE REFERRED TO Biharilal Jaiswal v. CIT [1996] 217 ITR 746/ 84 Taxman 236 (SC). R.L. Jain for the Applicant. B.K. Joshi for the Respondent. ORDER 1. By this application under section 256(2) of the Income-tax Act, 1961 ('the Act') as it stood before the Amendment of 1999, the applicant- department seeks direction to the Tribunal to refer the question, as stated in paragraph 8 of the application, for answer by this Court. 2. From the averments made in the application, it…

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