Per Shri H. S. Ahluwalia, Judicial Member - The only dispute in this appeal relates to the assessees claim for registration. In the earlier years, the business was being carried on by the assessee as a proprietary concern, but the same was converted into a partnership during this year. The application for registration had, therefore, to be made before the close of the accounting year, i.e., 10-11-1977; the same was made only on 3-7-1978. When asked to explain the delay, the assessee filed an affidavit sworn by its accountant to show that the original partnership deed along with copies and application form was given to him by one of the partners but he was under the impression that they are to be filed with the ITO along with the return. The ITO, however, refused to condone the delay and rejected the assessees claim for registration. The said conclusion was upheld by the AAC on appeal.
The assessee has come up in second appeal before us.
2. We had heard the representatives of the parties at length in this appeal and in our opinion there is no force therein. One argument advanced on behalf of the assessee was that there was sufficient cause for the delay in filing of the application for registration which should have been condoned in the peculiar circumstances of the case. In this behalf, our attention was drawn to an affidavit of Shri Maruti Kapale in which it has been sworn that the original partnership deed along with photostat copies and necessary forms of application had been given to him before the close of the accounting year by Shri Dipak Ruparel, a brother of Shri H. D. Ruparel, for necessary action after consultation with his counsel. According to him, there was the bona fide belief that the application was to be submitted along with the return of income which normally is to be filed on 30th June. It was for the first time that he noticed that the application had to be filed before the close of the accounting year. According to the assessee, the affidavit filed by the accountant could not have been ignored in the absence of contrary evidence. For this purpose reliance was placed on a decision of the Honble Supreme Court in Mehta Parikh & Co. v. CIT  30 ITR 181 in which it has been held that an affidavit should not be discarded in the absence of contrary evidence of cross-examination of the deponent. However, this authority has no bearing on the facts of the present case. Both the application forms in Form No. 11 filed before of the ITO containing the date of signatures of the partners as on 28-6-1978 whereas, now the position taken by the deponent of the assessee is that the partners had duly signed the papers and sent them to the counsel before the end of the accounting year. If it is so, the signature of the partners would be a of of date earlier than the close of the accounting year. At the time of hearing before us, Shri Daga contended that the partners of the assessee-firm signed blank application forms which, accordingly, had actually been filled in by Shri Daga when the papers were received by him in June 1978. This means that the date of June 1978, filled in by him, was actually not the date of the signature by the partners on those application forms. In other words, either Shri Daga had added the date of his own which is not in accordance with the spirit of law, inasmuch as the date is to be insert on which the application is actually signed or the affidavit is wrong. If the application was signed by the partners before Diwali 1977, then the same should bear that date, but no application signed on that date was produced before us. So that, the affidavit is prima facie unbelievable and contrary to the facts. The decision of the Madhya Pradesh High Court in CIT v. Khemraj Laxmichand  114 ITR 75 holding that the Tribunal was justified in condoning the delay and allowing registration to the firm would, therefore, not help the assessee because there the finding was that it was a bona fide mistake. Now here, the partners of the assessee-firm are not ignorant to the legal position as they are partners in several firms. They have been absolutely careless in not seeing that the application was presented before the ITO within the time prescribed by Law. In Sri Ramamohan Motor Service v. CIT  89 ITR 274 (SC) it has been held that before a person can claim the benefit of section 26A of the Indian Income-tax Act, 1922 (the 1922 Act), he must strictly comply with the requirement of that section and the relevant rules. Even a substantial compliance with the rules was not sufficient. The assessees appeal against the order refusing registration was rejected by their Lordships for the reasons that in filling column No. 6 of the form some mistake had been committed by the assessee.
3. The other point urged on behalf of the assessee was that the partners of the assessee-firm having been assessed on their share incomes no fresh assessment as an unregistered firm could be made as it would involve double taxation. For this purpose, reliance was placed on a number of authorities namely, CIT v. Blue Mountain Engg. Corpn.
 112 ITR 839 (Mad.) Laxmichand Hirjibhai v. CIT  128 ITR 747 (Guj.) and Universal Commercial Co. v. CIT  130 ITR 775 (Mad.). All these authorities lay down that once the ITO has exercised the option of assessing the partners on the share income of the firm, it would not be open to him to assess the firm as an unregistered firm.
We are afraid we are inclined to accept the assessees contention raised in this behalf. Firstly, most of these decisions are under the 1922 Act and in this behalf, the AAC has rightly drawn the distinction between the language of section 3 of the 1922 Act and the present section 4 of the Indian income-tax Act, 1961 (the Act). The schemes of the two Acts, according to the AAC, were different. He, therefore, chose to rely on the decision of the Calcutta High Court in Ramanlal Madanlal v. CIT  116 ITR 657. This decision has subsequently been endorsed by the Andhra Pradesh High Court in Deccan Bharat Khandsari Sugar Factory v.CIT  123 ITR 802 where it has been held that the observation of the Honble Supreme Court in CIT v. Murlidhar Jhawar & Purna Ginning & Pressing Factory  60 ITR 95 would no longer apply to the case of assessments made on unregistered firms or partners of such firms, particularly when the assessment on the partners is provisional. It is correct that in the present case the partners have been assessed substantially but the ITO assessing them is not the same ITO who had to decide the present application for registration. They had been assessed by the ITO at Bombay and there is nothing on the record to show that it had been brought to the notice of that ITO that the assessee-firm had not been granted registration by the ITO at Satna at the time of these assessment so that the share income from the assessee-firm added was on provisional basis subject to rectification. If the assessee is already taxed on this income as an unregistered firm, naturally the assessment of the partners at Bombay can be rectified.
4. Lastly, it was contended that there would not be much difference in the tax effect if the assessee-firm is taken as registered firm and the partners are assessed on their share income as against treating the assessee as an unregistered firm. It was contended that the partners have their individual income at a fairly higher figures so that the revenue will not suffer much as a result of refusal of the present so that the revenue will not suffer much as a result of refusal of the present registration. According to the assessee, the total difference was only Rs. 210 as per chart shown at page 10 of the paper book. Apart from the fact that the tax effect is not material because the registration has to be granted according to law, we find that the calculation by the assessee at page 10 is not final one. It has been stated that in case of Shri H. D. Ruparel, the share of loss from Premji Valji and Co. had been taken at nil. But this person had actually suffered a loss of Rs. 9,695 for which he had filed an appeal so that there may be material difference in that tax effect also.
Therefore, this argument raised on behalf of the assessee has equally no force.
5. In the result, we are of opinion that there is no force in this appeal. It is hereby dismissed.