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TMI Blog1962 (11) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... years I940 and I94I. It carried on the business of dyeing and selling dyed yarn. It effected sales of dyed yarn of the total value of Rs. 14,22,995 and Rs. 19,22,107 in the previous years relevant to the assessment years I94I-42 and I942-43 respectively. The sales were made to purchasers both in the Indian States and in what was British India. During the previous year relevant to I94I-42 out of the total sales of the value of Rs. I4,2 2,996, Rs. 11,88,063 were to merchants in British India and out of these some sales were to Calcutta merchants which are not now in dispute and the balance amounting to Rs. 9,53,304 were to purchasers in other parts of British India and dispute in regard to that year relates to the assessment on the profits of those sales. Similarly, in the previous year relevant to I942-43 Out of the total sales of Rs. I9,22,107 a sum of Rs. 6,04,588 were made to purchasers in British India and assessment in regard to profits out of that sum is in dispute. The Income-tax Officer found that the sale price was received by the assessee company at Petlad in the erstwhile Baroda State by means of cheques, drafts and hundis in the years relevant to the two assessment year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore in the circumstance of the case and on the evidence and in the absence of correspondence we must necessarily infer an implied request by the assessee to remit by post, the parties having adopted the normal accepted commercial practice for making the payment in such type of cases. " The High Court on April 21, 1960, answered the question in the affirmative and against the assesee. It also observed that the mode of payment accepted by the assessee company was that the payment had to be made by sending the cheques, drafts and hundis by post from British India and it could not be said that there was no evidence before the Appellate Tribunal for holding that there was an implied request by the assessee company to the buyer to send the cheques, etc., by post. Against that judgment and order these two appeals have been brought pursuant to a certificate by the High Court. For the appellant two contentions were raised : (i) the order of the High Court dated September 23, 1955, asking for a supplemental statement and allowing additional evidence was without jurisdiction; (2) that on the statement of the case the answer to the question submitted should have been in the negative and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harge of that liability. The Privy Council held that the High Court's judgment is merely the expression of the opinion as to whether a certain question of law which arises during the course of assessment has to be used one way or the otherand that the word " judgment " is not used in section 51 of the Income-tax Act, now section 66 of that Act, in its strict legal and proper sense : Tata Iron & Steel Co. v. Chief Revenue Authority (1923) 50 I. A. 212, 223 and Delhi Cloth & General Mills Co. Ltd. v. Income-tax Commissioner (I927) 54 I. A. 42I In Tata Iron & Steel Co.'s case appeal was taken to the Privy Council against the judgment of the High Court given under section 51(3)) Of the Income-tax Act, now section 66(5), on a certificate of the High Court. A preliminary objection was taken in the Privy Council that the appeal was incompetent as the decision of the High Court on a reference made by the Chief Revenue Authority under section 51 of the then Income-tax Act was not a final judgment within clause 39 of the Letters Patent of the Bombay High Court. The Privy Council held that where the case is stated for the opinion of the High Court under the Income-tax Act the judgment is mere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T. R. 108;A. I. R. 1961 S. C. 794. [1950] S. C. R. 799 which was a case under the Bihar Sales Tax Act and in which the High Court refused to direct the Board of Revenue to state a case and refer it to the High Court, held the order of refusal not to be a final order within clause 3I of the Letters Patent of the Patna High Court inasmuch as the jurisdiction exercised by the High Court was advisory and standing by itself the order did not bind or affect the rights of the parties. The court relied on the decision in Tata Iron & Steel Co.'s case 1. At page 805 Fazl Ali J. observed as follows: "But the High Court acquired jurisdiction to deal with the case by virtue of an express provision of the Bihar Sales Tax Act. The crux of the matter therefore is that the jurisdiction of the High Court was only consultative and was neither original nor appellate. "Even in cases tried under the civil jurisdiction of the courts it has been held that an order is final if it decides the rights of the parties in a civil proceeding but, if after the order, the proceedings have still to be continued and rights in dispute between parties have to be determined then the order is not final within article ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt cannot ask for additional facts to be brought in because these would not be in regard to a question which arises from the order of the Tribunal but would be a statement based on something which was not before the Appellate Tribunal when it passed its appellate order. Therefore, although the High Court has the power to direct a supplemental statement to be made it has no power to direct additional evidence being taken. It was so held in New Jehangir Vakil Mills v. Commissioner of Income-tax ) [1959] 37 I. T. R. II, [1960] 1 S. C. R. 249. That was a case similar to the one before us and the question for decision there was whether the sale proceeds had been received at Bhavnagar because the cheques, etc., were sent to Bhavnagar. The High Court held that the mere receipt of cheques by post at Bhavnagar was not conclusive in the absence of a further finding whether the cheques were sent by post, by request, express or implied, of the assessee. In that case the I-Ii-h Court asked for a supplemental statement of the case and also allowed additional evidence to be given and this court held that section 66(4) did not empower the High Court to direct additional evidence being taken and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manded the case to the Appellate Tribunal for a supplemental statement of case to find whether cheques were sent to the assessee by post or by hand and what direction, if any, had been given by the assessee firm to the Government department. It was held that such a supplemental statement could be called for and in the absence of anything expressly stated in the order of the High Court to the contrary it cannot be said that the direction given would include the admitting of any fresh evidence as that had been prohibited by the New Jejangir Vakil Mills' case [1959] 37 I. T. R. II ; [1960] I S. C. R. 249, At page 2I9 the court observed: "It follows from this that that enquiry in such, cases must be to see whether the question decided by the Tribunal admits the consideration of the@ new paint as in into(Oral or even an incidental part thereof. Even so, the,, supplemental statement which the Tribunal is directed of submit must arise from the facts admitted and/or found by the Tribunal, and should not open the door to fresh evidence. " Another case where the scope of section 66(i) was defined is Commissioner of Income-lax v. Scindia steam Navigation Co. Ltd. [ 1961] 42 I. T. R.. R. 589 ..... 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