The Income Tax Officer is required to consider all relevant factors, including any petition filed by the assessee, before passing an order under section 185(3) of the Income Tax Act, 1961.

K. S. Paripoornan, C. J. , Naresh Kumar Sinha, J.

1. At the instance of the assessee the Income Tax Appellate Tribunal, b Bench, Patna, has referred the following two questions of law for the decision of this Court under section 256 (1) of the Income Tax Act :

(1) Whether, on the facts and circumstances of the case, the Appellate tribunal was justified in holding that the form no.12 filed separately by the partners of the firm did not fulfil the terms of proviso to sub-section (7) of Sec.184 of the Income Tax act, 1961 ?

(2) Whether, on the facts and in the circumstances of the case, the appellate Tribunal was correct in law in holding that the order passed by the Income Tax Officer on 25 9 72 refusing continuation of registration under Sec.185 (3) of the Income Tax act, 1961, was not premature or illegal ?

2. We heard counsel for the petitioner-assessee and also counsel for the Revenue. The question referred to this Court, and the facts relating thereto cover a wide range. It is unnecessary to traverse the entire grounds in the view that we take regarding the official order passed by the Income Tax Officer dated 25.9.72 under section 185 (3) of the income Tax Act.

3. The minimal facts to answer the vital or crucial question in this case are as follows : we are concerned in this case with the assessment year 1972-73. The assessee was allowed registration upto the year 1971-72. For the year 1972-73 it had time to file the returns under section 139 (1) of the Income Tax Act till 30.9.1972. It was granted time of file returns till 6.10.1972 by the Income Tax Officer under section 139 (2) of the Income Tax Act. It was open to the assessee firm to file the declaration under section 184 (7 ). Proviso clause (ii) at any time before 6.10 1972 (time allowed under section 139 (2) of the Act ). But the firm filed a declaration in form 12 on 22-8 72 The firm had three partners, namely bihariji Mills Ltd. , Gopi Krishna Kanodla and Banarshi Lal kctriwal. The first Form 12 was filed on 2281972 which was signed only by Banarshi Lal Kotriwal. The Income Tax Officer issued a letter on 23.8 1972 to the assessee and stated that the determination in Form 12 was not in order and one months time was given for removing the defects. It is evident from the statement of the case at paragraph 5 which is also borne out from the order of the Appellate Tribunal (the Income Tax appellate Tribunal) dated 21.7.1972, (paragraph 7) that the assessee filed a petition on 229.1972 to the effect that Gopi krishna Kannodia was not available because of ill-health and so time should be granted. By order dated 259.1972 the Income tax Officer held that the defects were not removed, so the registration granted to the firm in the year 1971-72 would not continue. This affected the assessment of the firm for the year 1972-73. The assessee filed an appeal against the said assessment order It was affirmed by the first Appellate Authority and confirmed in Second Appeal by the Tribunal.

4. As stated earlier, many questions on merits were raised before us. We find that the order passed by the Income Tax Officer dated 25.9.72 declining to continue the registration of the firm in exercise of the power vested in him under section 185 (3) of the Act suffers from a fundamental infirmity. The order passed by the Income Tax Officer dated 259.1972 is document no.1. It is an order passed under section 185 (3) of the Income tax Act Indeed the order had been passed in conformity with the earlier order passed by the Income Tax Officer dated 23.8 1972. The officer gave one months time to remove the defects. It was not done. Normally the income Tax Officer could have proceeded to consider and dispose of the form 12 filed before him but the assessee had filed a petition on 22.9.1972 praying for time. This application does not eem to have been considered in the order passed by the Income Tax Officer dated 25.9 1972 declining to accept the Form No 12 filed by the assessee. We are of the