JUDGMENT - M. C. CHAGLA, C. J.

This is not the first instance in which the Tax-ng Department has insisted on adherence to the letter of the law and overlooking the substance. But in this case it has excelled even itself. We are concerned with a question of registration and Mr. Joshis contention is that S. 28A is a technical sec-:ion. it must be construed technically, it must be administered technically, irrespective of the injustice it may do. We realise that the Income-tax Act is a technical Act and questions of equity cannot be incorporated in construing the provisions of the law But even the Income-tax Act must be construed ac cording to some principles of commonsense. Even the Income-tax Act must be construed so that the | Court, as far as it can possibly do so, construe a section in favour of the assessee and against the Department where in so construing it does not deprive the Department of revenue and it saves the assessee from a palpable injustice.

(2) Now the facts are that the assessee firm sought registration and it was denied registration by all the three authorities - the I.T.O. the A.C.C. and the Tribunal. It was in existence and register ed under the Indian Income-tax Act from 1945 and he registration which was refused was for the assess ment year 1954-55. It is rather significant that it is conceded by the Department that the partner ship which is sought to be registered is a genuine partnership., It is conceded by the Department that every document on which the assessee relies for the purpose of registration is a genuine document; and yet it is urged that because of a certain aspect of law which was not present to the mind of the De partment for all these years, it is entitled to refuse registration in the assessment year 1954-55. Un doubtedly, if the law permits the Department to go back upon an accepted position from 1945 that the partnership was entitled to be registered, then it can do so. But we must very carefully scrutinise the provisions of the law before we come to the conclusion that it is open to the Department under the circumstances of this case to refuse registration to the assessee firm.

(3) Now, the partnership deed under which the firm was previously registered was dated 13th Sep tember, 1945 and that partnership continued till the 6th of November, 1953. The previous year, or the accounting year for the assessment year 1954-55, is the Samvat year 2009, 19th October, 1952 to 8th November. 1953. A new partnership deed was executed on the 22nd of January, 1954. This was in respect of a new partnership that came into existence on the 7th of November, 1953. The old partnership was altered by a change in the constitution of the firm., There was a further change in the constitution of the firm and a third partner ship deed was executed on the 29th of November, 1951. This change came about by reason of the fact that one of the partners died. Now the asses see firm applied for registration on the 19th of February, 1954 and it made a second application for registration on the 27th of November, 1954 and it is with this second application that we are con cerned. To this application it annexed the partner ship deed of the 29th of November, 1954. The application for registration was signed by the six partners who were partners of the firm under the deed of the 29th of November. 1954 and the schedule to the application for registration mentioned the names of the partners of the firm which was sought to be registered, their shares in the profits and losses and also the names of the partners who constituted the firm at the date of the application for registration and also their shares in the profits and losses. We may also point out that, although this application is dated 27th of November, 1954, it was actually presented on the 80th of November, 1954, so that it was based on the partnership deed •of the 29th of November, 1954.

(4) Under S. 26A the firm that is to be registered is the firm which is to be assessed

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