JUDGMENT : A. Pasayat, J. - At the instance of the Revenue, the Income Tax Appellate Tribunal, Cuttack Bench (hereinafter referred to as "the Tribunal"), has referred the following questions u/s 256(1) of the Income Tax Act, 1961 (hereinafter referred to as "the Act"). "1. Whether, on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in holding that the Appellate Assistant Commissioner was right in quashing the entire assessment order passed by the Income Tax Officer u/s 144 of the Act ? 2. Whether, on the facts and in the circumstances of the case and on a correct interpretation of law, the Tribunal was justified in holding that the order passed by the Income Tax Officer is not an order u/s 185 and hence the same was liable to be quashed ? 3. Whether, on the facts and in the circumstances of the case and in view of the provisions of Section 185(5), the Income Tax Appellate Tribunal was justified in holding that the Appellate Assistant Commissioner was right in quashing the order of the Income Tax Officer passed u/s 144 of the Income Tax Act, 1961 ?" Background facts as culled out from the statement of case drawn up by the Tribunal are as follows : M/s. Mahabir Fancy Store (hereinafter referred to as "the assessee") filed its return for the assessment year 1984-85 corresponding to the accounting period ending on March 31, 1984, on November 24, 1984. Up to the assessment year 1983-84, the assessee was assessed as a registered firm and has been granted registration. For the assessment year 1984-85, a declaration in Form No. 12 for renewal of registration was filed. Since the assessee did not respond to the notices issued, the assessment was completed ex parte u/s 144 of the Act and the assessee was treated as an unregistered firm. The assessee carried the matter in appeal before the Appellate Assistant Commissioner of Income Tax, Berhampur Range, Berhampur (in short, "the AAC" ). The sole point urged before the appellate authority was that an order of refusal of registration could only be passed u/s 185 of the Act and refusal of registration in an order passed u/s 144 was not proper. It was observed that the Income Tax Officer, while passing an order u/s 144, was not competent to refuse registration therein. The sole point urged before the appellate authority was that an order of refusal of registration could only be passed u/s 185 of the Act and refusal of registration in an order passed u/s 144 was not proper. It was observed that the Income Tax Officer, while passing an order u/s 144, was not competent to refuse registration therein. The Appellate Assistant Commissioner accepted the submission and the appeal was allowed. The Revenue carried the matter in appeal before the Tribunal which affirmed the views of the appellate authority. The stand of the Revenue before the Tribunal was that, if the Appellate Assistant Commissioner had set aside the assessment regarding the quantum and directed the Income Tax Officer to make a fresh assessment, then he should have set aside that part of the assessment order also and should have directed the Income Tax Officer to reconsider the issue of refusal of registration. Though, the Tribunal found substance in the stand of the Revenue, it observed that the order of the Appellate Assistant Commissioner to the effect that to refuse registration a separate order was to be passed was also valid. It held that the same not having been done, refusal of registration suffered from infirmity and it was in the discretion of the Appellate Assistant Commissioner to set aside the order on that point also, and to direct the Income Tax Officer to reconsider the matter afresh relating to the point of refusal of registration. But he did not do so and held that the refusal of registration was invalid. The Tribunal observed that there was no illegality or irregularity in the order of the Appellate Assistant Commissioner. Being aggrieved at the conclusion, a reference was sought for and the questions as indicated above have been referred to this court for opinion. 2. Heard Mr. Ray for the Revenue. In spite of notice, the assessee has not entered appearance. According to learned counsel for the Revenue, the approach of the Appellate Assistant Commissioner and the Tribunal is erroneous. Orders under Sections 144 and 185 of the Act operate in different fields. The Appellate Assistant Commissioner should not have dealt with the question of propriety to grant registration in an order u/s 144. The order u/s 144 was not available to be assailed before the Appellate Assistant Commissioner on the question of registration. 3. Orders under Sections 144 and 185 of the Act operate in different fields. The Appellate Assistant Commissioner should not have dealt with the question of propriety to grant registration in an order u/s 144. The order u/s 144 was not available to be assailed before the Appellate Assistant Commissioner on the question of registration. 3. Orders which are appealable have been enumerated in Section 246 of the Act. We are dealing with the section as it stood at the relevant time. According to the said section, any assessee aggrieved by any of the orders enumerated above, -and passed by an Assessing Officer may file an appeal to the first appellate authority. At the relevant time an order passed u/s 144 was appealable under Clause (c) of Section 246. An order under Clause (b) of Sub-section (1) or under Sub-section (2) or Sub-section (3) or Sub-section (5) of Section 185 was appealable under Clause (j) of Section 246. Obviously, therefore, a separate order under Sub-section (5) of Section 185 is contemplated when refusal of registration is directed. Under subsection (5) of Section 185, notwithstanding anything contained in the said section, where, in respect of any assessment year, there is, on the part of a firm, any such failure as is mentioned in Section 144, the Income Tax Officer may refuse to register the firm for the assessment year. Sub-section (5) of Section 185 provides that where there is on the part of the firm such failure as to entail a best judgment assessment u/s 144, the Income Tax Officer may refuse to register the firm. Section 144 provides that the Income Tax Officer shall make the assessment to the best of his judgment in cases enumerated therein. The terms of the section are mandatory and the Income Tax Officer has no discretion to make or not to make assessment under the section. If the assessee is a firm, the Income Tax Officer may, in his discretion, which has to be exercised judicially in any of the contingencies enumerated in Section 144, refuse to register the firm u/s 185(5) or may cancel its registration if it is already registered u/s 185(2). Section 186(2) provides that, in such cases, the registration which is granted or which has effect u/s 184(7) for the relevant assessment year may be cancelled. Section 186(2) provides that, in such cases, the registration which is granted or which has effect u/s 184(7) for the relevant assessment year may be cancelled. In either case, the Income Tax Officer must pass an order refusing to register, or cancelling the registration of the firm. He cannot, while making assessment u/s 144, merely treat the firm as unregistered. (See Nand Singh Taneja and Sons Vs. Commissioner of Income Tax, ). 4. An order of assessment and an order refusing registration to a firm are separate and distinct orders requiring separate appeals. Even if the Income Tax Officer passes one single order making a best judgment assessment and refused registration u/s 185(5), separate appeals should be filed against such assessment and refusal (see Fuel Supply Co. Vs. Commissioner of Income Tax, ). If the Income Tax Officer, in exercise of his power u/s 185(5), refuses to register the firm because of default which resulted in a best judgment assessment, the firm may appeal u/s 246 against the order refusing to register it, even on the ground on which it could have asked for cancellation of the best judgment assessment u/s 144, without making an application under that section for such cancellation, (see Mannilal Sagarmal Vs. Commissioner of Income Tax, ). Obviously, therefore, the action of the Income Tax Officer in passing a consolidated order of assessment and refusal of registration, and styling it as one u/s 144, was not in order. 5. As indicated above, it is open to the assessee to file separate appeals. In the case at hand, the assessee has not assailed the quantum of assessment and has challenged only the refusal of registration. Therefore, it had not questioned the correctness of the assessment. The appeal filed by the assessee, in essence, related to that part of the order which related to registration. The first appellate authority was justified in entertaining the appeal and dealing with the question of propriety of refusal to register. But it was not justified in setting aside the entire order u/s 144. It could have directed the Income Tax Officer to reconsider the matter relating to registration, or could have decided it himself. By declaring the order to be invalid and quashing it, the quantum assessed got nullified. It was beyond the scope of appeal, and there was even no dispute regarding the quantum. It could have directed the Income Tax Officer to reconsider the matter relating to registration, or could have decided it himself. By declaring the order to be invalid and quashing it, the quantum assessed got nullified. It was beyond the scope of appeal, and there was even no dispute regarding the quantum. The first question is, therefore, answered in the negative. 6. If the stand of the Revenue is that the order passed by the Income Tax Officer was, in essence, one u/s 185 of the Act, obviously the appeal before the Appellate Assistant Commissioner was competent and the Appellate Assistant Commissioner was justified in his conclusion. Questions Nos. 2 and 3 do not really bring out the essence of the dispute. Accordingly, we reframe the question and combine both the questions to the following effect : "Whether, on the facts and in the circumstances of the case, the Appellate Assistant Commissioner and the Tribunal were justified in holding that, in an order passed u/s 144, the question of registration cannot be considered ?" In view of the analysis made by us, the conclusion is inevitable that even though the registration aspect can be considered, two appeals are to be filed when the assessee questions both the correctness of the assessment and the refusal of registration. Since the assessee in the instant case had questioned only the refusal of registration, the Appellate Assistant Commissioner and the Tribunal should have considered the legality of the order so far as it related to registration instead of holding that the same was without jurisdiction. The Tribunal shall consider this aspect when it hears the matter u/s 260 of the Act, 7. The reference is, accordingly, disposed of. D.M. Patnaik, J. 8. I agree.