SIR HUKUMCHAND & MANNALAL CO. versus COMMISSIONER OF INCOME-TAX, MADHYA PRADESH

Citation: [1966] 3 S.C.R. 193 · Decided: 04-01-1966 · Supreme Court of India · Bench: K. SUBBA RAO · Disposal: Appeal(s) allowed
Open in Lexace · Ask the AI about this case
Judgment (excerpt)

B 
c 
D 
E 
F 
. 
• 
G 
I ' 
• 
H 
SIR HUKUMCHAND & MANNALAL CO. 
v. 
COMMISSIONER OF INCOME-TAX, 
MADHYA PRADESH 
January 4, 1966 
(K. SUBBA RAO, J. C. SHAH AND S. M. SIKRI, JJ.] 
Income-tax Act ( 11 of 1922), s. 26A and Income-tax Rules, rr. 6A. 
and 6B---Order of cancellation under r. 6B-If appea/ab/e. 
The Income1-tax Officer cancelJ-00 the certificate of renewal of reg;s-
tration of the appellant-firm, under r. 6B of the Income-tax Rules, on 
the ground that the firm was not a genuine on·o. 
The Appellate Assistant 
C'<Jmmissioner, the Tribunal and the High Court o.n reference, held that 
no appeal lay against 1he order of the Income~tax Officer to the Appellate 
Aaistant Commissioner under s. 30(1) of 1he Income-rnx Act, 1922. 
In appeal to this Court, 
HELD :The words "refusal to register a firm" in s. 30 are 
wide 
enough to take in the orders made under rr. 6A and 6B refusing to renew 
n~4!atration and also cancelling the certificate so renewed, and such 
an 
order directly attracts the appellate jurisdiction conferred on the Appellate 
A.o.sistant Commissioner under the section. [196 E; 197 F] 
The fact that s. 30 provides for an appeal separately against the orders 
under s. 23 ( 4) either refusing to register a firm or cancelling the registra-
tion of a firm, but provides in the context of s. 26A, for an appeal only 
against an order refusing to register the firm, does not affect this con>-
truction of s. 30, because, when s. 30 provides for an appeal against the 
orders under s. 23 ( 4), it has merely incorporated the two forms of orders 
embodied in s. 23 ( 4), and, when it provides for an appeal against the 
order under s. 26A, it has used a general word, for the nature of the 
order under s. 26A is not described but is left to be prescribed under the 
Rules. The application under s. 26A made to the Income-tax Officer 
on behalf of a firm for registration for the purposes of th<: Act, will be 
diaposed of in the manner prescribed by rr. 6A and 6B. Under these Rules, 
the Income-tax Officer is authorised to make three kinds of orders, namely, 
(i) he can refuse to renew the registration; (ii) he can register; and (iii) 
he can cancel the1 renewal if he is satisfied that a renewal was obtained 
without there being a genuine firm in existence. 
But the three kinds of 
orders, having regard to 
th·~ circumstances of each case, will be made 
only on an application for renewal of registration, because, the Rules do 
not provide for independent proceedings to the cancellation. of the re-
newed eertificate. 
When the Income-tax Officer cancels a renewed certi-
ficate, he sets aside his earlier order and refuses a renewal, with the result 
that, an order of refusal to renew a certificate and the order cancelling 
the renewed certificate are given the same effect, namely, refusal of the 
application to register. 
It follows that the order cancelling registration is 
nothing more than refusing to 
ri~new the 
certificate of registration. 
[196 A-E: 197 C-El 
CIVIL APPELLATE JURISDICTION :Civil Appeal No. 223 of 
1965. 
Appeal from the judgment and order dated February 23, 1962 
of the Madhya Pradesh High Court in Misc. Civil Case No. 165 
of 1961. 
194 
SUPREME COURT REPORTS 
[1966) 3 S.C.R. 
N. A. Palkhiva/a, S. T. Desai, T.A. Ramachamlran, I. B. 
A 
Dadac/zanji, for the appellant. 
A. V. Viswanatha Sastri, R. H. Dhebar, N. D. Karkha11is and 
R. N. Sachthey, for the respondent. 
The judgment of the Court was delivered by 
B 
Sobba Rao, J. 
This appeal, on a certificate granted by the 
Madhya Pradesh High Court, raises the question 
whether 
an 
appeal lies under s. 30(1) of the Indian Income-tax Act, 1922, 
hereinafter called the Act, to the Appellate Assistant Commis-
sioner against the order of an Income-tax Officer cancelling an 
order granting registration of a firm under s. 26-A of the Act. 
C 
The facts material for the said question may be briefly stated. 
The appellant is a firm constituted under a deed of parlnership 
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 regis-
tration was renewed for the years 1951-52 and 1952-53. On D 
November 30, 1957, the Income-tax Officer renewed the registra-
tion for the assessment year 1953-54. On March 6, 1959, on 
the ground that the firm was not a genuine one, the said officer 
cancelled the registration under Rule 6-B of the Income-tax Rules. 
The appellant preferred an appeal against that
Excerpt shown. Read the full judgment & AI analysis in Lexace.