TMI Blog1957 (9) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... understand the contentions of the parties that arise for determination on this writ petition : Classification of sales Total sales Total realisations (out of sales shown in column 2) through shops or banks in British India where the company had accounts. Realisations (out of sales shown in column 2) through banks in British India where the company had no accounts. 1 2 3 4 i. Sales effected through Amritsar shops. ₹ 1,32,515 ₹ 1,32,515 Nil ii. Sales effected through Cawnpore shops ₹ 72,945 ₹ 72,596 Nil iii. Sales in pursuance of contracts completed at Cawnpore and Amritsar shops and passed on to Indore for execution Nil Nil Nil iv. Sales in cases where the merchants or brokers of the merchants visited Indore and contracts were signed in British India ₹ 40,098 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that these two questions relate to the two amounts of ₹ 4,21,873 and ₹ 6,02,911 respectively. The reference was heard by the Chief Justice and myself on August 29,1951 and by our judgment we held that the sales of ₹ 4,21,873 took place at Indore and the sale proceeds were received at Indore, but the statement of the case did not enable us to determine where the contracts were accepted. We then pointed out the importance of knowing the place where the the contracts were entered into and referred the matter back to the Tribunal to dispose of the matter on the basis of our judgment. With regard to the sum of ₹ 6,02,911 we held that the Tribunal had omitted to take into account various documents, and we directed the Tribunal to take them into account and to decide the matter themselves. In the course of the judgment of the Division Bench delivered by the learned Chief Justice, it was also pointed out that the Income-tax Officer had found that a sum of ₹ 5,80,069 out of the sum of ₹ 6,02,911 had been actually received in British India and this fact appeared to have been completely overlooked by the Tribunal. We therefore, directed the Tribunal that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 66, sub-section (5), provides as follows : The High Court upon the hearing of any such case shall decide the questions of law raised thereby and shall deliver its judgment thereon containing the grounds on which such decision is founded and shall send a copy of such judgment under the seal of the court and the signature of the Registrar to the Appellate Tribunal which shall pass such orders as are necessary to dispose of the case conformably to such judgment. It is clear therefore that what the Tribunal is required to do after the questions have been answered by the High Court is to pass such orders as are necessary to dispose of the case conformably to such judgment. Mr. Kolah contends that the requirement of this subsection merely enables the Tribunal to make a formal order and the Tribunal cannot do anything more. Mr. Kolah's contention is that since the High Court held in respect of both the items of ₹ 6,02,911 and ₹ 4,21,873 that they were not taxable under section 4(1) (c), the Tribunal should simply have deleted these items from the order of assessment and done nothing more. It appears to us that such a superficial view of this sub-secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther the High Court had jurisdiction to give that direction and not whether the Tribunal, when the questions referred to the High Court were determined in the manner in which they have ultimately been determined, have to consider whether ₹ 5,80,069 were liable to be taxed on the basis of receipt. We do not think, therefore, the order of the Tribunal can be challenged on the ground that it is an attempt to circumvent the judgment of the Supreme Court. Then Mr. Kolah argues that the powers of the Tribunal on appeal are limited, as was held in the case of Motor Union Insurance Co. v. Commissioner of Income-tax [1945] 13 ITR 272, per Kania, J. , as he then was, at page 230, and in Puranmal Radhakishan v. Commissioner of Income-tax [1957] 31 ITR 294 , which is a decision to which I was a party. These two decisions have been followed by this court in several unreported cases and what we have laid down is that the Tribunal cannot base its decision on appeal on any fresh grounds. What the Tribunal primarily is entitled to do is to determine the objections raised by the appellant before it, and the word thereon in section 33 limits the jurisdiction of the Tribunal to the ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o tax by the Income-tax Officer in British India on the, basis of receipt; but obviously that was not done, not because the Income-tax Officer did not find that the amount was not received in British India, but because he held that this was receipt out of the total sales of ₹ 6,02,911, the income from which was taxable in British India on the accrual basis under section 4(1)(c). Mr. Kolah contends that the word realisations used in the statement supplied by his clients and accepted by the Income-tax Officer does not mean the same thing as receipt. It may be that in strict law it does not; but what is material for the present purpose is that the Income-tax Officer obviously treated it as synonymous with receipt, because when he brought to tax ₹ 10,95,157 under section 4(1)(a), he describes that amount as realised in British India, and of course what is taxable under section 4(1)(a) is what is received in British India and not merely realised. There is, therefore, no doubt that before the Income-tax Officer it was the case of the Department that a sum of ₹ 5,80,069, with which alone we are concerned on this writ petition, was received in British India and it wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his case did not take the view that the assessment on the accrual basis was wrong. There was a reference to the High Court and the High Court took that view ; and it appears to us that the moment the High Court took that view, the necessary corollary followed that the Tribunal's view was wrong and the Appellate Assistant Commissioner's view was wrong with regard to the taxability of the income arising from the total sales of ₹ 6,02,911 on the accrual basis. It appears to us, therefore, that we go back to a situation where the Appellate Assistant Commissioner's finding that the income from the total sales of ₹ 6,02,911 on the basis of accrual was, or must by reason of our answers to the questions referred to us be deemed to be, that it was not taxable on the accrual basis. If it was not so taxable, then obviously the situation arises which would have arisen if the Appellate Assistant Commissioner himself had taken that view, that to the extent of this amount of ₹ 6,02,911 the assessment must be set aside and the Income-tax Officer directed to consider whether any portion of these sale proceeds were received in British India. That precisely is the order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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