2004 (2) TMI 697 - HC - Income Tax

Summary

Issues:
1. Validity of cross-objections filed by the legal representative of the assessee.
2. Compliance with the provisions of Sec. 253(4) regarding the filing of cross-objections.
3. Notice requirements and service on the appellant.
4. Consideration of cross-objections even if the appeals are withdrawn.

Analysis:

Issue 1: Validity of Cross-objections
The legal representative of the assessee filed cross-objections against the order of the Commissioner of Income Tax (Appeals), which were later dismissed by the Tribunal as barred by limitation. The appellant contended that the cross-objections were filed in time as she only became aware of the pending appeals after her counsel noticed her name being called out during a Tribunal hearing. The Tribunal held that the cross-objections were time-barred as they were filed in October 2001, while they should have been filed in July 1993 based on the date of receipt of Form No. 36 and grounds of appeal. The High Court found the Tribunal's decision unsustainable and allowed the appeals, setting aside the order of the Tribunal regarding the dismissal of cross-objections.

Issue 2: Compliance with Sec. 253(4)
The Tribunal based its decision on Sec. 253(4) of the Act, stating that cross-objections should have been filed within 30 days from the date of receipt of Form No. 36 and grounds of appeal. The appellant argued that the limitation for filing cross-objections starts upon the receipt of notice. The High Court agreed with the appellant, emphasizing that no notice was issued or served on the appellant until October 2001, which was after her counsel took notice during a Tribunal hearing in February 2001. The Court concluded that the cross-objections were filed in time and criticized the Tribunal for overlooking this crucial aspect.

Issue 3: Notice Requirements and Service
The High Court scrutinized the records of the appeals and found discrepancies in the issuance and service of notices to the appellant. Despite dispatching a notice in 1993 to the deceased assessee, the appellant, as the legal representative, did not receive any notice until October 2001. The Court highlighted that the notice requirements under Sec. 253(4) were not fulfilled, as no notice was issued or served on the appellant in a timely manner. The Court deemed the dismissal of cross-objections by the Tribunal as unjustified due to the lack of proper notice and service.

Issue 4: Consideration of Cross-objections
The High Court emphasized the principle behind Order 41 Rule 22 of the CPC, which allows the continuation of cross-objections even if the appeals are withdrawn. In this case, the Revenue withdrew its appeals, but the legal representative of the assessee sought to continue the cross-objections. The Court acknowledged the applicability of this principle and allowed the appeals, remitting the matters to the Tribunal for the hearing and disposal of the cross-objections filed by the appellant in accordance with the law.

In conclusion, the High Court ruled in favor of the legal representative of the assessee, highlighting the importance of proper notice, compliance with statutory provisions, and the continuation of cross-objections even in the event of appeal withdrawals.