Case Law Details
RELEVANT PARAGRAPH
4. The question to be considered is whether non-filing of a certified copy of instrument of partnership along with returns filed for the assessment years 1993- 94 and 1994- 95 is fatal to assessee’s claim for assessment in the status as a ‘firm’. The contention of counsel for the assessee is that the firm, which was assessed in that status until 1992- 93, need not furnish certified copy of the instrument of partnership, for assessment in the status as ‘firm’ for the subsequent assessment years because there was no change in the deed of partnership. In other words, according to mm, the firm once assessed in that status, is entitled to be assessed in the same status for all subsequent years by virtue of operation of Section 184(3) of the Act, if there was no change in the constitution of the firm for any of those years. 7th Standing Counsel on the other hand, contended that assessment year 1993- 94 is the first year in which assessee’s claim for assessment in the status, of firm after the amended provisions came into force has to be considered. Therefore, according to him, the assesses was bound to produce certified copy of the instrument of partnership along with return, it is pertinent to note that prior to the introduction of amended provisions which came into force with effect from 1.4.1993, a firm could be assessed either as a registered firm on complying with the formalities or otherwise only as an ‘Association of Persons’. However, with effect from the assessment year 1993-94 on wards, registration of firm is dispensed with, but for the first time, if a firm seeks registration in that status for any assessment year commencing on or after 1.4.1993, the firm has to furnish the certified copy of the instrument of partnership along with the return for the relevant assessment year. In our view, even an assessee, which enjoyed registration as a ‘firm’ up to the assessment year 1992- 93, is required to furnish certified copy of instrument of partnership if assessment was claimed in the status of firm for any assessment year commencing from 1993- 94 on wards. Once the status as ‘firm’ is made for any assessment year commencing from 1993-94 on wards based on the certified copy of instrument of partnership produced, then by virtue of operation of subsection(3), the firm will be assessed in the same status for all subsequent years without production of any certified copy of instrument of partnership until there is a change in the constitution of the firm. For assessment as firm after change in the constitution of the firm, subsection (4) of Section 184 requires production of revised instrument of partnership along with return for the assessment year relevant for the previous year in which such change in the partnership took place. Sub-section (3) refers to the assessment in the status as a ‘firm’ based on the assessment made pursuant to production of certified copy; of instrument of partnership referred to in ‘sub-section (2) of Section 184 and not the assessment made as a registered firm for any assessment year prior to 1993-94. The consequence of non-production of certified copy will naturally lead to dis allowance of claims of deduction toward? payment of interest, remuneration, bonus etc. paid to partner by the firm by virtue of Section 185 of the Act We, therefore, hold that the production of certified copy of instrument of partnership is mandatory for claiming assessment in the status of a – firm for any -assessment year commencing from 1993- 94 on wards irrespective of whether such assesses was assessed as a registered firm up to 1993- 94. In principle, we therefore, uphold the findings of the Tribunal.
