Uday Sinha, J.

1. The following question of law has been referred to us for our opinion under Sec.256(1) of the Income-tax Act, 1961 :

"Whether, on the facts and in the circumstances of this case, the Tribunal was correct in law in allowing continuation of registration to the firm ?"

2. The matters relate to the assessment years 1962-63 to 1965-66.

3. The assessee is a firm at Patna. Prior to the years in question, it had been assessed in the status of a registered firm. In the years in question, the Income-tax Officer called upon the assessee by a notice under Sec.142(1) of the Income-tax Act (hereinafter referred to as "the Act"), to produce certain books of account. These books of account had been seized by the sales tax authorities who had made assessment under the Sales Tax Act on the basis of entries in those books. From the books seized, the sales tax authorities formed the conclusion that the assessee had done substantial clandestine business which had not been disclosed in the regular books of account. The assessee did not produce the required books of account. The, stand of the assessee was that those books of account were not available, as they had been lost by t