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Matha Plantations Vs. Deputy Commissioner of Agricultural Income-tax and Sales Tax and anr. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtKerala High Court
Decided On
Case NumberOriginal Petition No. 1563 of 1981-M
Judge
Reported in[1984]150ITR480(Ker)
ActsKerala Agricultural Income Tax Act, 1950 - Sections 27; Kerala Agricultural Income Tax Rules, 1951 - Rule 2; Indian Income Tax Act, 1922 - Sections 26A; Indian Income Tax Rules, 1922 - Rule 2
AppellantMatha Plantations
RespondentDeputy Commissioner of Agricultural Income-tax and Sales Tax and anr.
Appellant Advocate C.K. Sivasankara Panicker,; P.B. Mohankumar and; K.V. Go
Respondent Advocate Hassan, Government Pleader
Excerpt:
.....order passed by respondent setting aside order of assessment - as per section 27 read with rule 2 application shall be signed by all partners personally - application signed by power of attorney holder did not satisfy requirements of law - registration of firm irregular - no infirmity in order passed by respondent - no substance in petition - petition liable to be dismissed. - - pottenkulam, a fortiori, the requirement of the rule is also satisfied by the said power of attorney signing in the application filed for registration. the word 'personally 'in the rule is intended to mean only that the person who signed the partnership deed should sign the application for registration as well. ' 7. in the light of the above decisions, the contention raised by the learned counsel for..........issue of a writ of mandamus or other direction directing the respondent to treat the petitioner-firm as a firm registered under the kerala agricultural income-tax act and for other reliefs.2. counsel for the petitioner, mr. c. k. sivasankara panicker, contended that the main reason advanced in ex. p-6 to cancel the registration granted to the firm is that the application for registration is defective, and that it has been signed for and on behalf of one of the partners only by his power of attorney and not by the partner personally as required by r. 2 of the kerala agricultural income-tax rules and so registration cannot be granted. counsel contended that in ex. p-l, partnership deed, on behalf of one of the partners, his power of attorney holder has signed the deed and the.....
Judgment:

Paripoornan, J.

1. The petitioner is a firm. It is an assessee to agricultural income-tax borne 'on the files of the 2nd respondent. A firm was constituted as per deed dated August 1, 1970, marked as Ex. P-1. For the year 1971-72, on application, registration to the firm was granted under Section 27 of the Kerala Agricultural Income-tax Act. The assessment was made on such basis on March 30, 1976. The Deputy Commissioner of Agricultural Income-tax and Sales Tax, the 1st respondent, in suo motu revision, required the petitioner to show cause why the registration granted should not be cancelled or revoked. The notices issued in this connection are Exts. P-2 and Ex. P-4 dated February 27, 1980, and September 25, 1980, respectively. The petitioner's reply thereto are Exts. P-3 and P-5 dated March 28, 1980, and November 20, 1980, respectively. By Ex. P-6 order dated December 2, 1980, the 1st respondent found that the grant of registration to the firm is irregular and set aside the order of assessment and remanded the matter to the Agricultural Income-tax Officer for a fresh disposal according to law. In this O.P., the petitioner prays for quashing Ex. P-6 order passed by the 1st respondent and for the issue of a writ of mandamus or other direction directing the respondent to treat the petitioner-firm as a firm registered under the Kerala Agricultural Income-tax Act and for other reliefs.

2. Counsel for the petitioner, Mr. C. K. Sivasankara Panicker, contended that the main reason advanced in Ex. P-6 to cancel the registration granted to the firm is that the application for registration is defective, and that it has been signed for and on behalf of one of the partners only by his power of attorney and not by the partner personally as required by r. 2 of the Kerala Agricultural Income-tax Rules and so registration cannot be granted. Counsel contended that in Ex. P-l, partnership deed, on behalf of one of the partners, his power of attorney holder has signed the deed and the application for registration has also been signed by him. If the power of attorney was competent to sign in the partnership deed to bind Mr. Thomas V. Pottenkulam, a fortiori, the requirement of the rule is also satisfied by the said power of attorney signing in the application filed for registration. The word ' personally ' in the rule is intended to mean only that the person who signed the partnership deed should sign the application for registration as well. The Government Pleader, Mr. Hassan, on behalf of the Revenue contended that Section 27 of the Act read with Rule 2 of the Kerala Agricultural Income-tax Rules mandated that the Application shall be signed by all the partners personally. The application signed by a power of attorney holder will not satisfy the requirements of law. The firm will not be entitled to registration.

3. Section 27 of the Kerala Agricultural Income-tax Act and Rule 2 of the Kerala Agricultural Income-tax Rules are as follows :

'27. Procedure in registration of firms.--(1) Application may be made to the Agricultural Income-tax Officer on behalf of any firm, constituted under an instrument of partnership specifying the individual shares of the partners, for registration for the purposes of this Act and of any other enactment for the time being in force relating to agricultural income-tax or super-tax. (2) The application shall be made by such person or persons and at such times and shall contain such particulars and shall be in such form, and be verified in such manner, as may be prescribed ; and it shall be dealt with by the Agricultural Income-tax Officer in such manner as may be prescribed '.

2. Any firm-constituted under an instrument of partnership specifying the individual shares of the partners may, under the provisions of Section 27 of the Agricultural Income-tax Act, 1950 (hereinafter in these rules referred to as the Act), register with the Agricultural Income-tax Officer the particulars contained in the said instrument on application made in this behalf.

4. Such application shall be signed by all the partners (not being minors) personally and shall be made-

(a) before the agricultural income of the firm is assessed for any year under Section 18 of the Act, or

(b) if no part of such income of the firm has been assessed for any year under Section 18 of the Act, before such income of the firm is assessed under Section 35 of the Act, or

(c) with the permission of the Assistant Commissioner of Agricultural Income-tax hearing an appeal under Section 31 of the Act, before the assessment is confirmed, reduced, enhanced or annulled, or

(d) if the Assistant Commissioner of Agricultural Income-tax sets aside the assessment and directs the Agricultural Income-tax Officer to make a fresh assessment, before such fresh assessment is made, or

(e) before or after the dissolution of the firm in respect of the assessment or assessments to be made on its agricultural income up to the date of dissolution : Provided that where an application is made under Clause (e) after dissolution of the firm, it shall be signed' by all persons who were partners in the firm immediately before dissolution and by the legal representative of any such person who is deceased.'

5. In construing Section 26A of the Indian I.T. Act, 1922, and Rule 2 of the Indian I.T. Rules, 1922, wherein occurs identical wording to the effect :

' Such application shall be signed by all the partners (not being minors) personally......', the Supreme Court in Dulichand Laxminarayan v. CIT. : [1956]29ITR535(SC) held :

'.........in order to be entitled to the benefit of registration under the Act, it will have to be shown that the shares of all individual partners are specified in the deed and that all the partners have personally signed the application for registration as required by Section 26A of the Act read with Rule 2. The deed specifies that each of the five constituent parties is entitled to an equal, i.e., 1/5th share, but it does not specify the individual shares of each of the partners of each of the three smaller constituent firms. Further, all the members of those three firms have not signed the application for registration personally. It is said that each of the three persons who executed the deed for the three smaller firms must be regarded as having the authority of their co-partners in their respective firms to sign the application for registration just as they had their authority to execute the deed itself for them. Even if they had such authority--as to which there is no evidence at all on the record--the section and Rule 2 require that each partner (not being minors) must sign personally. That admittedly has not been done, and, therefore, the application was not in proper form.'

6. So also in Rao Bahadur Ravulu Subba Rao v. CIT : [1956]30ITR163(SC) , construing Section 26A of the Indian I.T. Act, 1922, and Rule 2 of the Indian I.T. Rules, 1922, the Supreme Court held at pages 173 and 174 :

'.........the Indian Income-tax Act is a self-contained code exhaustive of the matters dealt with therein, and its provisions show an intention to depart from the common law rule qui facit per alium facit per se. Its intention again is that a firm should be given the benefit of Section 23(5)(a), only if it is registered under section 26A in accordance with the conditions laid down in that section and the rules framed thereunder. And as those rules require the application to be signed by the partner in person, the signature by an agent on his behalf is invalid.'

7. In the light of the above decisions, the contention raised by the learned counsel for the petitioner cannot hold good. The language of Rule 2 (read with Section 27) is peremptory and is clear. The order passed in revision by the 1st respondent, Ex. P-6, is unassailable. The O.P. 'is without force. It is dismissed with costs.


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