Commissioner of Income Tax vs Mohd. Bux Shokat Ali

This is a reference application at the instance of the revenue u/s 256(2) of the Income Tax Act arising from the order of the Income Tax Appellate Tribunal dated 7-5-1998.

The assessing authority made the assessment at the total income of Rs. 5,90,300 against the returned income of Rs. 2,45,224. The assessing authority also passed an order u/s 186(1) of the Act refusing the continuation of registration. He also made an addition of Rs. 3,30,232 on account of clubbing the income of M/s. Mohd. Bux Shokat Ali. The Tribunal vide order dated 8-1-1991 granted registration and deleted the addition. However, the assessing officer imposed penalty of Rs. 20,000 u/s 272(1)(b) vide order dated 22-2-1990. Commissioner (Appeals) cancelled the penalty on the ground that the firm has been granted registration and the addition has been deleted. The order was upheld by the Income Tax Appellate Tribunal on the ground that the very basis for levying penalty did not survive. The revenue has approached this court for reference in view of the fact that the reference application against the earlier order of the Income Tax Appellate Tribunal dated 8-1-1991 is pending before this court. The learned counsel for the revenue has brought to our notice that said IT reference has been rejected for default in compliance. Be that as it may the order of the Income Tax Appellate Tribunal, directing registration and deleting addition has become final. Thus no referable question of law arises from the order of the Income Tax Appellate Tribunal. The reference application is accordingly rejected.