HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
Commissioner of Income Tax, Kanpur v. Nitya Nand Devkinandan
Civil Appeal Nos. 111–111A of 1982
[1997] Supp. 1 SCR 575 ·
184(7) (historical registration continuance) · 185(3) and 185(4) (historical) · 263 · 246(j) (historical appellate context) · 261
Sources & disclosures includedDownload original judgment / order
Two-judge bench · S.C. Agrawal, J. · D.P. Wadhwa, J.
Assessment years: 1972-73, 1973-74
01 · Facts of the case
The firm obtained registration for AY 1967-68 and continued to be treated as registered through AY 1973-74. Its application of 3 November 1966 stated partners’ shares differently from the partnership deed. The Commissioner said the profit distributions did not conform to Form 11-A; the firm said the form contained a mistake and the profits had consistently been divided according to the deed (physical pages 4–5).
The Commissioner cancelled continuance for AYs 1972-73 and 1973-74 under section 263 and directed fresh assessments. He did not propose action for earlier years because the relevant actions were beyond the then two-year limitation. The Tribunal held both that no revisable order existed and that the form discrepancy did not render the registration erroneous where profits followed the deed. The Allahabad High Court’s judgment of 5 November 1980 accepted the no-order view and left the separate merits question unanswered as academic. Revenue appealed by certificate (physical pages 3–6).
Source: See the proposition-specific paragraph and PDF-page references below.
02 · Discussion by the Hon’ble Court
The Court distinguished the old 1922-Act requirement of annual renewal applications from the 1961-Act continuance scheme. Dispensing with a fresh annual application did not eliminate the Income Tax Officer’s decision. Under historical sections 184(7) and 185(3)–(4), the officer had to examine the declaration, determine compliance and either record the continuance certificate or, after the prescribed defect-intimation and rectification opportunity, make the adverse order contemplated by section 185(3) (physical pages 6–8).
The certificate had a bearing on the firm’s tax liability and could prejudice Revenue if wrongly recorded. The Court therefore treated the decision embodied in the certificate as an order capable of revision under section 263, subject to the other statutory conditions. It agreed with Jagadhri Electric Supply & Industrial Co. The earlier Ashwani Kumar case concerned section 185(3), not the present section 185(4) question, and did not support the High Court’s conclusion. The judicial discussion recounts the High Court’s rejection of the supporting Chekka Ayyanna reasoning; it does not expressly overrule Chekka Ayyanna despite the headnote label (physical pages 9–11).
Source: See the proposition-specific paragraph and PDF-page references below.
03 · Judicial decision
The Court allowed Revenue’s appeals, set aside the High Court judgment and answered question 1 in the negative, in favour of Revenue: the certificate was a revisable order. It remitted question 2, whether the form/deed discrepancy justified cancellation on the stated facts, to the High Court. There was no order as to costs (physical page 11).
Source: See the proposition-specific paragraph and PDF-page references below.
04 · Outcome / in whose favour
In whose favour: Revenue on revisional jurisdiction; cancellation merits unresolved
Appeals allowed; question 1 answered for Revenue; question 2 remitted to the High Court; no costs
Final on the existence of a revisable order; no final Supreme Court answer on substantive cancellation
No holding that every erroneous form entry warrants cancellation, no final tax computation and no revision of the earlier time-barred years.
Source: See the proposition-specific paragraph and PDF-page references below.
05 · AKHB REVIEW POINT
Separate the existence of a revisable order from whether it is actually erroneous and prejudicial to Revenue. A statutory certificate can embody an adjudicatory decision even if it is short or formally endorsed on an instrument. That does not dispense with section 263’s remaining requirements, nor does it resolve the form/deed mismatch that the Court remitted.
For this case, reconcile the deed, Form 11-A, continuance declarations and actual profit allocation before addressing the unresolved merits issue. Do not describe the appeal result as a final restoration of the Commissioner’s cancellation. No post-remand disposition has been verified.
The bounded 2011 statutory check confirms that the Finance Act, 1992 replaced the former sections 184–186 with effect from 1 April 1993; later section 185 was again substituted from 1 April 2004. These later provisions are materially different from the historical registration-certificate machinery considered here. The judgment does not certify present procedure, current section 263 conditions or a 2025-Act equivalent.
Source: See the proposition-specific paragraph and PDF-page references below.
Proposition-specific source paragraphs and PDF pages
- topic
- Identity and two referred questions
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- Open cited source
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- 1; 3; 4
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- Unnumbered judicial text
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- reported metadata and judicial text
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- Facts, limitation and distinct Tribunal grounds
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- Open cited source
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- 4; 5; 6
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- Unnumbered judicial text
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- judicial text
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- Historical scheme and defect-rectification procedure
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- 6; 7; 8
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- Unnumbered judicial text
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- Precedent-label conflict and revisability reasoning
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- 3; 9; 10; 11
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- Editorial headnote at physical page 3; unnumbered judicial text at physical pages 9–11
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- editorial headnote and judicial text
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- Actual disposition and merits remand
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- 11
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- Replacement of former firm-registration provisions
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- 780; 781
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- Sections 184–185 and footnotes 90, 94–96
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- bounded historical statutory text
Judicial authorship and separate opinions
S.C. Agrawal, J.Act identified in the reviewed source
Income-tax Act, 1961Assessment-year context and limits
Initial registration was for AY 1967-68; continuance through AY 1973-74 is background. Only AYs 1972-73 and 1973-74 were the challenged revision years.Source & verification
Download original judgment / order · Open cited source rendition
Identified source rendition: 11 PDF pages; SHA-256 8f3e3c0942728521fec18aed1abc5cbc05e6f7df84a1929eb829a9c7472dbf39. Original bytes preserved. Judicial text begins at physical page 3/SCR 577 with S.C. Agrawal J. and ends at physical page 11/SCR 585. Headnote pages 1–3 kept separate.
- The scanned cover correctly reads Nitya Nand Devkinandan; ingestion OCR misreads Nand as NANO. The displayed case name follows the image.; The source’s case-number line reads Civil Appeal Nos. 111–111A of 1982; the ingestion metadata supplies only lead appeal 111.; Physical page 3’s editorial headnote labels Chekka Ayyanna overruled. Pages 9–11 of the judicial text instead quote its supporting revisability position, recount the Allahabad High Court’s disagreement and adopt the matching Jagadhri view. No express Supreme Court overruling of Chekka Ayyanna appears in the judicial reasons; the headnote label is not used as a treatment finding.; Question 2 remains remitted. The Commissioner’s factual conclusion, the firm’s explanation and the Tribunal’s merits finding are distinct; none is converted into a final Supreme Court cancellation holding.; The then two-year limit explains exclusion of earlier years in this litigation; the note does not state a present limitation rule.
Statutory scope
No automatic mapping to the Income-tax Act, 2025 or present-law certification. Apply the statutory text for the relevant year.
Later treatment
Source checked 2026-10-04. Comprehensive later treatment remains unverified. Any actual bounded later-judgment or official-hosted historical statutory check is expressly identified.
Page references identify the supplied PDF; paragraph references identify the judgment unless stated otherwise.
Identified source links
- reported judgment — PDF 11 pages
SHA-256: 8f3e3c0942728521fec18aed1abc5cbc05e6f7df84a1929eb829a9c7472dbf39
- official department hosted historical statutory compilation — PDF 1251 pages
SHA-256: 1ec6e4c38dc1d524d1d40b1fd35d13ac1336c8fc549cef2af1bf723a999c822b
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