Report No. 12
192. Procedure on receipt of application.-
(1) On receipt of an application for registration of a firm, the Income-tax Officer shall inquire into the genuineness of the firm and its constitution as specified in the instrument of partnership (as read with the instruments of partnership referred to in clause (ii) of sub-section (1) of section 191, where the case so requires), and-
[Section 26A(2), part, read with rule 4]
(i) if he is satisfied that there is or was during the previous year in existence a genuine firm with the constitution so specified, he shall pass an order in writing registering the firm for the assessment year;
[See rule 4(1)]
(ii) if he is not so satisfied, he shall pass an order in writing refusing to register the firm.
[See rule 4(2)]
(2) The Income-tax Officer shall not reject an application for registration merely on the ground that the application is not in order, but shall intimate the defect to the firm and give it an opportunity to rectify the defect in the application within a period of one month from the date of such intimation.
(3) If the defect is not rectified within such time, the Income-tax Officer may reject the application.
(4) The Income-tax Officer shall finish the inquiry under this section before the expiry of a period of one year from the date of filing of the application, or before making an assessment on the firm for the
(5) Where a firm is registered for any assessment year, the Income-tax Officer shall record a certificate on the instrument of partnership or on the certified copy submitted in lieu of the original instrument, as the case may be, to the effect that the firm has been registere4 under this Act, for that assessment year; and where a declaration under section 191(7) [relevant sub-section of section for application for registration, to the effect that in the case of subsequent assessment year only a declaration need be sent] is furnished by the firm for any subsequent assessment year, he shall also endorse a note of such declaration having been furnished on the said instrument or certified copy.
[New] [See Rule 4(1), part]
(6) Notwithstanding anything contained in this section, where, in respect of any assessment year, there is, on the part of a firm, any such failure as is, mentioned in section 148 [section 23(4), main para., earlier half, embodied in section re: best judgment assessment], the Income-tax Officer may refuse to register the firm for the assessment year.
[Section 23(4), main para., latter half, part]
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