Section 254 of the Income-tax Act, 1961

HIGH COURT OF JUDICATURE MADHYA PRADESH, INDORE BENCH Commissioner of Income-tax v. Shiya Dawoodi Bohara Jamat A.M. SAPRE AND S.R. WAGHMARE, JJ IT APPEAL NO. 297 OF 2007 October 17, 2007 Section 254 of the Income-tax Act, 1961 - Appellate Tribunal - Powers of - Assessee, claiming to be public trust, filed application under section 12A/12AA for its registration which was dismissed by Commissioner - On appeal, assessee filed certain additional documents in support of its claim for registration - Tribunal took said additional evidence on record and, without deciding any of rights of parties, remanded case to Commissioner for fresh decision after taking into consideration additional evidence - Whether as a result of remand, since no rights of revenue were in any way adversely affected inasmuch as after remand, Commissioner was again called upon to decide application of assessee on merits strictly in accordance with law, impugned order did not suffer from any illegality and same deserved to be upheld - Held, yes FACTS The assessee, claiming to be a public trust applied under section 12A/12AA for its registration. The Commissioner dismissed the said application. On appeal, the assessee filed certain additional documents in support of its original application for registration made under section 12A/AA which it had not filed along with the original application before Commissioner. The Tribunal took the said additional evidence on record and while setting aside the order passed by the Commissioner, remanded the case to the Commissioner for again deciding the application afresh after taking into consideration the additional evidence adduced by the assessee in appeal. On revenue’s appeal: HELD No fault could be noticed in the impugned order for several reasons. In the first place, it was a remand order. Secondly, it did not decide any of the rights of the assessee nor of revenue much less against the revenue. Thirdly, once the additional evidence was allowed to be taken on record as being material for deciding the application made by assessee under section 12. A/AA at the appellate stage by the appellate authority then as a necessary consequence the matter had to be sent back to the original authority for deciding the case again on merits strictly in accordance with law after taking into consideration the entire material on record, i.e., the one already filed along with the original application and the one filed at the appellate stage as additional evidence. Fourthly, it cannot be disputed that Tribunal while exercising the appellate powers under section 254 has jurisdiction to remand the case to the subordinate authority for deciding the dispute. Fifthly, as a result of the remand, no rights of revenue were in any way adversely affected because after the remand, the Commissioner was again called upon to decide the application made by the assessee on merits strictly in accordance with law and lastly, every appellant in appeal has a right to file additional evidence in support of their case and if the appellate authority feels that additional evidence is material for deciding the controversy involved in the case then in the interest of justice, the same can always be allowed to be filed even at a appellate stage. In the instant case, the Tribunal had considered the additional evidence to be material for deciding the application made by the assessee though prima facie and hence, granted indulgence to assessee to rely upon the same in support of its application made under section 12-A before the Commissioner. The additional evidence adduced by the assessee could be taken on record. The Tribunal rightly allowed it to be taken on record for deciding the application by the Commissioner. [Para 8] The remand order by itself did not involve any question of law much less substantial question of law. It also did not involve any jurisdictional question because the appellate court has jurisdiction to remand the case. It was much more so when the Tribunal had not decided the issue finally one way or other then in such circumstances there did not arise any case to interfere by the High Court in its appellate jurisdiction. [Para 9] Therefore, the impugned order which in substance was in the nature of remand did not suffer from any illegality and, hence, it deserved to be upheld. [Para 10] As a consequence, the appeal was to be dismissed in limine. [Para 11]