TMI Blog2004 (12) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of law under section 256(1) of the Income-tax Act, 1961 ("the Act"), for the opinion of this court at the instance of the Commissioner of Income-tax, Rajkot: "Whether, under the facts and circumstances of the assessee's case, the Tribunal was right in holding that in the absence of any specific time-limit prescribed under section 11(2) of the Income-tax Act, 1961, for submission of the notice in the prescribed manner to the assessing authority, and in the absence of any express or by clearly implied delegation to the rule-making authority of any power to impose any time-limit, such time-limit prescribed in rule 17 for submission of Form No. 10 by the rule-making authority is invalid and whether the Tribunal was right in holding that the appellant-trust has complied with all the conditions prescribed in section 11(2) and is entitled to benefits allowable under the aforesaid provisions?" The assessee is a charitable trust, registered under the provisions of the Bombay Public Trusts Act, 1950. The assessment year is 1980-81 and the relevant accounting year is March 31, 1980. During the year under consideration, the assessee received voluntary contributions amounting to Rs. 2,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d after hearing both the sides, held that, in the absence of any specific time-limit prescribed under section 11(2) for submission of the notice as prescribed, and in the absence of any express or clear implication of any delegation to the rule-making authority of any power to impose any time-limit, such limit prescribed in rule 17 for submission of Form No. 10 by the rule-making authority was invalid and also contrary to various judgments. The Tribunal further held that, while interpreting the provisions of section 11 of the Act, the object with which such provision has been enacted has to be borne in mind and, accordingly, the provisions have to be interpreted in a manner that would advance a genuine cause of charity and should not deprive an assessee of the statutory benefit on the basis of mere technicalities. The Tribunal has further held that even if the interpretation of such a beneficial provision is reasonably capable of more than one interpretation, one which does not result in deprivation of such an intended relief, should be accepted. On the facts, the Tribunal has found that, in the present case, the genuineness of the trust is not in doubt; that the trust has set ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n), refusing to condone the delay in submitting Form No. 10, and fixing a notional time-limit by reference to the provisions of section 139(1) or 139(2) of the Act, to submit that the said proposition was not borne out by the provisions of the Act and the rule-making authority could not curtail the scope of such provisions by imposing a time-limit by way of rules. Mr. Shah further submitted that the findings recorded by the Tribunal regarding genuineness of the trust, the setting apart of the income, investment in prescribed securities, non-utilisation of funds by the trustees, etc., are relevant factors for the purposes of determining the controversy and in the light of such findings, the approach of the revenue authorities in denying legitimate relief to an assessee who was bona fide litigating, requires that the order of the Tribunal be confirmed by answering the question in favour of the assessee. The facts, as stated hereinbefore, are not in dispute. The only question which the court is required to decide is, as to whether, in the absence of any specific time-limit prescribed under section 11(2) of the Act, whether the time-limit prescribed in rule 17 for submission of Form ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessable income of the assessee. Therefore, even assuming that there is no valid limitation prescribed under the Act and the Rules, even then, in our opinion, it is reasonable to presume that the intimation required under section 11 has to be furnished before the assessing authority completes the concerned assessment because such requirement is mandatory and without the particulars of this income, the assessing authority cannot entertain the claim of the assessee under section 11 of the Act. Therefore, compliance with the requirement of the Act will have to be any time before the assessment proceedings. Further, any claim for giving the benefit of section 11 on the basis of information supplied, subsequent to the completion of assessment, would mean that the assessment order will have to be reopened. In our opinion, the Act does not contemplate such reopening of the assessment." At first blush, the reading of the aforesaid pronouncement gives an impression that the stand of the Revenue is correct, inasmuch as a notice in writing furnishing the prescribed particulars should be submitted before the assessing authority and a completed assessment cannot be reopened, if such par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e from the facts as found by the income-tax authorities and having a bearing on the tax liability of the assessee. The powers of the Tribunal under section 254 of the Act and the discretion that the Tribunal has to entertain or not to entertain a new ground, have been explained in the following words, in the aforesaid decision (headnote): "Under section 254 of the Income-tax Act, 1961, the Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. The power of the Tribunal in dealing with appeals is, thus, expressed in the widest possible terms. The purpose of the assessment proceedings before the taxing authorities is to assess correctly the tax liability of an assessee in accordance with law. If, for example, as a result of a judicial decision given while the appeal is pending before the Tribunal, it is found that a non-taxable item is taxed or a permissible deduction is denied, there is no reason why the assessee should be prevented from raising that question before the Tribunal for the first time, so long as the relevant facts are on record in respect of the item. There is no reason to restrict ..... X X X X Extracts X X X X X X X X Extracts X X X X
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