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Judgment
At the instance of the Revenue, the Tribunal, Patna Bench, Patna, referred to this Court, the following two questions for the asst. yr. 1976-77 for
its opinion :
Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the ITOs order passed under s. 184(7) was
an appealable order ?
Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the assessee-firm was entitled to
registration even though no fresh deed of partnership was executed on the attainment of majority by two minors admitted to the benefits of the
partnership ?
Mr. Sharan, learned counsel for the Revenue does not press the first question and we, therefore, need not answer the same.
As regards the second question, we may briefly note the facts.
The assessee-firm had been granted registration prior to the assessment year in question. For the asst. yr. 1976-77, the assessee sought
continuation of registration granted to it under sub-s. (7) of s. 184 of the Act by submitting an application in Form No. 12 as prescribed in the
rules. The ITO refused to continue the registration as he found that during the relevant accounting year two minors admitted to the benefits of the
partnership had become majors and no fresh partnership deed had been executed evidencing that fact. On appeal by the assessee, the AAC
relying on a circular of the CBDT (Circular No. 26/35/61, ITA-1 dt. 3rd January, 1962) was of the view that there was no doubt about the
genuineness of the partnership and directed the ITO to allow the continuation of the registration of the assessee-firm.
The appeal of the Revenue to the Tribunal against the order of the AAC failed.
In the meanwhile, it appears that another circular of the CBDT dt. 4th August, 1977, came into force repealing the earlier circular. Mr. Sharan,
learned counsel contended that on the date of the assessment order, the later circular was in force and the AAC and the Tribunal should have
relied on the later circular and not the one of the year 1962. We do not think that the contention raised by Mr. Sharan is right. According to us, the
operation of the circular dt. 4th August, 1977, would be prospective. The Tribunal, therefore, rightly held that the circular of 1962 applied in the
present case.
Accordingly, on the second question, our answer would be in the affirmative, in favour of the assessee and against the Revenue. There will be no
order as to costs.