Case Law Details
In the case of JB Greaves (supra), which is the decision of the jurisdictional High Court, it has been held that the subject – matter of appeal before the Tribunal would be the grounds raised by the appellant before it. Rule 11 provides that the appellant shall not except by the leave of Tribunal, be heard in support of any ground not set forth in the memorandum of appeal.
But the Tribunal in deciding the appeal shall not be confined to the grounds set forth in the memorandum of appeal and grounds taken by leave of the Tribunal. Rule 27 provides that even though, the respondent may not have filed appeal, he may support the order of Appellate Assistant Commissioner on any of the grounds decided against him. Thus the subject matter of appeal consist of three elements :- I) grounds taken in memorandum of appeal, 2) grounds for which leave is allowed by the Tribunal, and 3) grounds taken by the respondent for supporting the order of AAC/CIT(A). This position has also been explained in the case of Hazarimal Nagaji & Co. decided by Hon’ble Bombay High Court, in which it has inter alia been mentioned that the position of Appellate Tribunal is same as that of a court of appeal under the Civil Procedure Code and its powers are identical with the powers enjoyed by an appellate court under the Code. Thus a respondent in an appeal is undoubtedly entitled to support the decree which is in his favour on any grounds which are available to him, even though the decision of the lower court in his favour may not have been based on such grounds. We have already held that a ground can be validly taken in the memorandum of appeal only if the appellant is aggrieved by the order of AAC I CIT(A). It has also been held that the ground No. 1 in the present appeal was never taken before any of the lower authorities and , therefore, this ground can not be validly taken up in memorandum of appeal. This brings us to the question whether this ground can be taken up as additional ground with the leave of the Tribunal. To our mind, the answer to the question is obvious in view of the decision in the case of NTPC, decided on 12.4.1996, after the decision was rendered in the case of Late Begum Noor Banu Alladin on 21.4.1993. The Hon’ble Supreme Court has held with the view that Tribunal is confined only to issues arising out of the appeal before the CIT(A) takes too narrow a view. This view was taken in the case of Anand Prasad , Karamchand Premchand Pvt. Ltd. and Cellulose Products of India Ltd. This means that the ratio of these cases has not found favour with the apex court. The decision in the case of Late Begum Noor Banu Alladin heavily relies on the decision in the case of Karamchand Premchand and Cellulose Products of India Ltd. If these cases have not been approved by the Apex Court, it follows that the decision based on these cases may not be followed by us. Further the Hon’ble Apex Court in very clear terms has held that the Tribunal will have discretion to allow or not to allow a new ground to be raised, but where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings, it fails to see why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assessee the tax liability of an assessee. The position of the assessee in the case at hand is similar to the position of NTPC, as both of them are appellants. Therefore, on the basis of the decision, it abundantly clear that if the pure question of law arises for which facts are on record of the authorities below, such a question should be allowed to be raised, if it is necessary to do so to assess the correct tax liability.
The Ld. Counsel has submitted that this ground could not be raised earlier as the assessee was not properly advised in the proceedings before the lower authorities, and it did not have the services of an advocate at his command. On perusal of record, this submission is found to be correct. The question is one of law and not one of fact. Therefore, it could be that a proper ground could not be raised in absence of services of an advocate although the denial of the deduction had been disputed. This constitutes a reasonable cause in the light of the decision in the case of Shaik Ibrahim (supra). Thus, we find that there are reasons to hold that the assessee could not take up this ground before lower authorities for bona-fide reasons.
INCOME TAX APPELLATE TRIBUNAL, SPECIAL BENCH : MUMBAI
I.T.A Nos. 5018 to 5022 & 5059/M/10 – Asstt. Years 2004-05 to 2009-10
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what do we understand by term mandatory law is the major question before apex court that is vital just because intent of legislature is reflected in a statute, if not followed , that is indeed violation of Art 265 of the constitution of india. that way basic structure of constitution is to be assessed.
Judging is more an art than a science!
In ITAT i would suggest first judicial member has to decide on the preliminary legal issues instead of account member taking on appealants for i see account member is invariably take a lot of time and try to lead the appellants to accept for refer back to AOs though referring back seems indeed some what hollow when aspects of law is to be decided, there is no point revert back to AO/ITO as legal aspects always on record before tribunal.
Most CAs are invariably not really qualified to handle basic legal issues that way hon SC rightly said in NTT Act that CAs are not qualified to handle interpretation,
fact is it is not CA or Advocates questions but it is the life and death of appelants, for any wrong interpretation of laws just turn a tax payer just a pauper, while the citizens need to be very carefully handled; else sooner or later people would lose faith on judiciary as such, that is most important than revenue to government, if people lose faith tax compliance would be a great casuality and governments would roll on every now and then, that is worst situsation for democracies!
Right.
When Question of law is raised that need to be allowed by hon tribunal, as referring back to AO or ITO is indeed meaningless or infructuous or miscarriage of justice, as there is no need of any verification on any facts by AO investigation . that way NTPC matter is rightly handled by Appex court.
Any jurisdictional bar by sections like 143(2) then very Notices fail under 143(2)(ii), when so hon Tribunal cannot refer back to AO/ITO is very clear.
Any bar of jurisdiction under relevant section is essentially mandatory means AO/ITO must first have his own check list before he issues Notices, if failed natirally his notices are void ab initio, as it is said none can go against public policy laid down by legislature is the crux.
Indeed here i read the above article and i wish all ITAT members be properly appraised of NTPC decision dated 12.04.1986 as mentioned in te article.
Hon tribunals need be given right handbooks on stare decis case laws as is valid on day else again ITAT members are bound to make mistakes that would unnecessarily affect taxpayers who are not criminals under any definition and so Art 265 talks about due process procedure.
if revenue is not able to handle load of work it would be most ideal outsource competent agencies like PwC or McKinsey/ or ICAi or CMA to handle issues of assessments and that way tax payers can be better served as also the government of the day is my considered view!