Case: Sir Hukumchand &amp; Mannalal Co Vs. Commissioner Of Income-Tax, Madhya Pradesh

2. The fact material for the said question may be briefly stated. The appellant is a firm constituted under a deed of partnership dated July 16, 1948. The Income-tax Officer registered the said firm under S. 26-A of the Act for the year 1950-51. The registration was renewed for the years 1951-52 and 1952-53. On November 30, 1957, the Income-tax Officer renewed the registration for the assessment year 1953-54. On March 6, 1959, on ground that the firm was not a genuine one, the said officer cancelled the registration under R. 6-B of the Income-tax Rules. The appellant preferred an appeal against that order to the Appellate Assistant Commissioner, Indore. On July 15, 1959, the said Appellate Assistant Commissioner rejected the appeal or the reason that no appeal lay against the order of the Income-tax Officer cancelling the registration. The appeal filed by the appellant against that order to the Income-tax Appellate Tribunal, Bombay, was dismissed. At the instance of the appellant, the following question was referred to the High Court under S. 66 (1) of the Act:"Whether on the facts and circumstances of the case, the order passed by the Income-tax Officer under R. 6-A of the Indian Income-tax Rules cancelling the certificate of renewal of registration granted to the assessee is appealable under S. 30 of the Income-tax Act."A Division Bench of the High Court of Madhya Pradesh answered the reference against the appellant. It held that no appeal lay under S. 30 of the Act against the order of the Income-tax Officer cancelling registration to the Appellate Assistant Commissioner. Hence the appeal.

Reasoning: There is some force in this argument. But a careful reading of the provisions of S. 23 (4) and S.A brings out the difference in the phraseology used in S. 30 in the matter of appeals against orders made under the said two Sections. The relevant parts of S. 23 (4) and S.A (2) may be placed in juxtaposition:Section 23 (4)Section... thex Officer... in the case of a firm, may refuse to register it or may cancel its registration if it is already registered The .... application shall be ... dealt with by theA comparative study of the relevant parts of these two provisions at once shows the distinction between the two. Under S. 23 (4) while thex Officer can make an order refusing to register a firm or may cancel the registration if it is already registered, under S.) he can only make an order in such manner as may be prescribed. The manner prescribed, as we have already indicated earlier, provides for three different kinds of orders to be made in the same application with the result that an order of refusal to renew a certificate and the order cancelling the certificate renewed are given the same effect, namely, refusal of the application to register. That apart, when S. 30 provides for an appeal against the orders under S. 23 (4) and also against orders under S., it has incorporated the two forms of orders embodied in S. 23 (4) and used a general word in providing an appeal against an order under S., for the nature of order is not described but left to be prescribed under the Rules5. If so, it follows that the words "refusal to register a firm" in S. 30 of the Act are wide enough to take in the orders made under Rr.A andB refusing to renew the registration and also cancelling the certificate so renewed6. By so holding we are not unaware that enquiry has no place in construing the provisions of thex Act. Indeed, we have not introduced any equitable consideration in the matter of construction. We have come to the conclusion on a fair reading of the relevant provisions of the Act and the Rules made thereunder.