TMI Blog1997 (12) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... d at the end of learned CIT(Appeals) in entertaining the appeal under section 246 of the Act. As no appeal lies against the order passed under section 206C of the Act, needs to be rectified. The learned CIT(Appeals) accepting the contention held in para 4 of his order that as no appeal lies against the order passed under section 206C of the Act, there being a legal mistake apparent in the appellate order dated 29-11-1996 in A. No. 120/DDN/95-96 passed in the case of the assessee, the same needs to be rectified. He accordingly rectified the aforesaid order by substituting what was said in paras2 to 9of the order to the effect that the appeal being incompetent is to be dismissed in limine. 3. On the above facts, the learned AR Shri O.S. Bajpai advanced detailed arguments which were also reduced in writing as well. It was submitted that the question whether the CIT(Appeals) has the jurisdiction under section 246 of the Act to hear an appeal against an order under section 206C of the Income-tax Act, is a highly debatable issue. It involves a long-drawn process of arguments and reasoning. It also requires interpretation of various provisions of law. By way of elaboration it was submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be dismissed again on another ground reviewing his earlier order under section 154 of the Act. Having acquiesced with the jurisdictional fact in the appellate proceedings and having represented the matter before the learned CIT(Appeals) in due course, without raising any objection as to his competence to hear the appeal, it is not permissible to do so specifically when the matter was pending before the ITAT. According to the learned AR the order under section 154 of the Act should have an effect of either enhancing or reducing 'an assessment' in terms of sub-sections (3) and (6) thereof, which is not so in the case of the assessee. The CIT(Appeals) cannot treat the order passed under section 206C differently for the purposes of section 154 and that of section 246 of the Act. 4. Shri S.K. Srivastava who appeared on behalf of the department, very ably and effectively put a defence against the arguments as advanced. This is appreciable in view of the order of the learned CIT(Appeals) being bereft of any reasons. As per his submissions, no appeal lies against the order passed under section 206C of the Act read with sub-sections (6) (7) and as such the learned CIT(Appeals) rightly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9] 73 ITR 283 (Bom.); (7) R.A. Boga v. AAC [1977] 110 ITR 1 (Punj. Har.); (8) CIT v. Peirce Leslie Co. Ltd. [1997] 227 ITR 759 (Mad.); (9) P. Kutti Krishnan Nair v. CIT [1961] 41 ITR 597 (Ker.); The decisions relied upon by the learned AR are distinguishable on the facts of the cases. The provisions of sections 154 and 154(1A) of the Act are clearly applicable and hence the order passed by the learned CIT(Appeals) is justified. 5. Reacting to the submissions of the learned DR it was submitted by Shri O.S. Bajpai that the following decisions cited by the learned DR are distinguishable:--- (1)IndiaWoollen Textile Mills (P.) Ltd.'s case.; (2) District Co-operative Bank Ltd.'s case; (3)IndiaTin Industries (P.) Ltd.'s case; The provisions of section 154(1A) of the Act are not applicable in the case of the assessee. 6. We have carefully considered the rival submissions, we have also gone through the decisions as cited. The operative part of section 154 of the Act reads as under:--- "154(1) With a view to rectify any mistake apparent from the record an income-tax authority referred to it in section 116 may,--- (a) amend any order passed by it under the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... what the provisions of section 154 of the Act convey. Mistake in question as argued on both sides is whether order passed under section 206C of the Act is appealable or not. 8. Recalling facts in brief, the ITO (TDS) Dehradun found that the District Excise Officer had not collected tax on basic fee (issue price) on sale of alcoholic liquors for human consumption (Other than Indian made foreign liquors). This was as stated in the order dated12-6-1996. After procuring the explanation of the party in detail, he held that the District Excise Officer had failed to collect tax at source and to pay it to the credit of the Central Government within the time prescribed under section 206C of the Act. After holding the district Excise Officer to be an assessee in default it was ordered that tax as well the interest on the same is required to be collected at his end. 9. The District Excise Taxation Officer (DETO in short) in turn filed an appeal before the learned CIT(Appeal) contending that the licence fee forming part of bid money was neither in any way related to nor form part of purchase price of liquor, it was Government levy for exclusive light to regulate trading in a country liq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted as an assessee in default by the ITO himself which category in such is covered under section 2(7)(c) of the Act. The aforesaid provisions in turn read as under:--- "(c) every person who is deemed to be an assessee in default under any provision of this Act." Further more whether the order of the Assessing Officer in directing the Excise Taxation Officer to pay the tax is not the one passed during the course of proceedings taken under the Act is another factor which is to be considered. This aspect is to be examined in the light of the observations of the Hon'ble Privy Council in the case of Khemchand Ram Das case, which runs as under:--- "The assessment as used in Income-tax Act means sometimes the computation of income, sometimes the determination of the amount of the tax payable and sometimes the procedure laid down in the Act for imposing liability upon the tax payer." Can the collection of tax from the District Excise Taxation Officer be considered under the expression 'determination of the amount of the tax payable. Or procedure laid down in the Act for imposition of liability.' In the face of demand created on District Excise Taxation Officer could it be sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elf would not clinch the issue either way in regard to the right of appeal. 12. In the above background is it the intention of the Legislature that no appeal is maintainable against the order passed under section 206C of the Act or not. The issue is to be examined in the light of remedy available if any, to the party on whom the liability of collection of tax on behalf of the third party is fastened. These are a few questions which need to be answered for deciding whether an appeal lies against order, passed under section 206C of the Act or not. To come to the conclusion, one way or the other, would be though long drawn process of arguments. Arguments as advanced on both sides have to be considered carefully on the light of the provision before coming to the final conclusion. In the circumstances, in our considered view there is no obvious or clear mistake of law which could have been rectified by the learned CIT(Appeals) under section 154 of the Act. After having decided the appeal on merits, he could not have set aside the order on perfunctory ground that no appeal lay against the order under section 206C of the Act. 13. Coming to the various decisions relied upon on both sid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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