The main legal point established in the judgment is that the absence of signature by partners in Form No. 12 is a technical defect, and the Income Tax Officer is duty-bound to afford the firm an opportunity to rectify the defect within a specified period.

Paripoornan, J.

At the instance of the Revenue, and as directed by this Court in O.P. No. 4377 of 1987-S, the Incometax Appellate Tribunal has referred the following two questions of law, for the decision of this Court:

1. Whether on the facts and in the circumstances of the case, was the Tribunal justified in law in holding that the defect should be treated as a technical defect and in directing the Incometax Officer to return form No. 12 to the assessee firm with a direction to submit the same after rectifying the defect within the time given by the Income-tax Officer?

2. Whether, on the facts and in the circumstances of the case, was the Tribunal correct in law in directing the Income-tax Officer to dispose of the question of granting registration to the assessee-firm after the expiry of the time given by the Income-tax Officer for complying with the defect in form No. 12".

2. The respondent/ assessee, a firm of ten partners, was granted registration for the assessment year 1978-79. We are concerned, in this reference, with the assessment year 1979-80, for which The accounting pcriodended on 31-12-1978. For the assessment year 1979-80, the assessee filed an application seeking continuation of registration. It turned out that two of its partners, who held 8% share each, did not sign in Form No. 12 of the Incometax Rules. The mother of the above two persons affixed her signature in Form No.12, as per the power of attorney enclosed to the application. The Incomclax Officer held that the declaration in Form No. 12 filed before him was not in order and continuation of registration was declined. The order of assessment is dated 23-9-1982. In the appeal, the Commissioner of Incometax (Appeals) held that if there was a defect in Form No. 12 filed by their assessee, the Incometax Officer should have granted an opportunity to rectify the defect. He directed the assessing authority to grant continuation of registration to the assessee-firm. The Revenue appealed before the Incometax Appellate Tribunal. By order dated 19-12-1985, the Incometax Appellate Tribunal held that the absence of signature by two of the partners in Form No. 12 is a technical defect and the Income Tax Officer ought to have granted time to the assesse-firm for rectifying the defect instead of rejecting outright the application in toto, and refusing registration. It was further held that the absence of signature by two of the partners in Form No. 12 declaration filed before the officer seeking continuation of registration is only a technical defect. The Incometax Appellate Tribunal directed the Incometax Officer to return Form No. 12 so filed to the assessee-firm with a direction to resubmit the same after rectifying the defect within the time given by the Incometax Officer and then to dispose of the question of granting continuation of registration to the assessee-firm after the expiry of the time given by him for complying with the defect in Form No. 12. In this view, the matter was remitted to the Incometax Officer. It is thereafter, at the instance of the Revenue and as directed by this Court in O.P. No. 4377 of 1987-S, the two questions of law formulated herein above have been referred by the Incometax Appellate Tribunal for the decision of this Court.

3. We heard counsel for the Revenue, Mr. P.K.R. Menon as also counsel for the respondent/ assessee Mr. S. Vijayan Nair. Counsel for the Revenue submitted before us that the absence of signature in Form No. 12 declaration filed cannot be considered to be a technical defect, that it was a case where there was no proper or valid declaration in Form No. 12 before the Incometax Officer, that Form No. 12 declaration without the signature of two of the partners will render the entire declaration as nonest in law, and at any rate, even if the Appellate Tribunal took the view that an opportunity should be given to the firm, the entire matter should have been remitted to the Incometax Officer without expressing any