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TMI Blog1957 (9) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... o set out that analysis in order to 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 ₹ 40,098 Nil v. Sales to parties in British India as per offers transmitted via media the company's reporters deputed to Cawnpore, Amritsar and Bombay ₹ 6,02,911 ₹ 5,80,069 ₹ 1,661 vi. Deliveries against old contracts entered into by Cawnpore and Amritsar shops ₹ 4,409 ₹ 4,363 Nil vii. Sales ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hem 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 they should take this fact into account upon remand. Against this judgment of the Division Bench, there was an appeal to the Supreme Court and their Lordships the Supreme Court were pleased to hold that this court was in error in requiring the Tribunal to dispose of the matter themselves instead of asking for a supplemental statement of the case ; they also held that the direction that this court had given in regard to the sum of ₹ 5,80,069 was "uncalled for". Thereafter a supplemental statement was submitted by the Tribunal to this court and the reference was heard again by the same Bench; and on September 5,1956, we answered both the questions referred to us the negative. The order of the High Court was forwarded to the Tribunal for disposal of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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-section is not warranted by the words of the sub-section which are "shall pass such orders as are necessary to dispose of the case. " The words that follow, namely, "conformably to such judgment" are merely words of limitation which prescribe that whatever the Tribunal does, they must of necessity conform to the judgment of the High Court; but subject to conforming to the judgment of the High Court, the Tribunal has to pass such orders as are necessary to dispose of the case, and the nature of the order that the Tribunal can pass in a given case must depend on the circumstances of the case, the questions referred to the High Court and other relevant factors ; and, in our opinion, it is not correct to describe the order that the Tribunal can pass under this sub-sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 grounds of appeal raised before it. This, however, does not preclude the Tribunal from determining the matter on the basis of facts which have been canvassed before the Income-tax Officer and the Appellate Assistant Commissioner, on which a finding may have been recorded by either the Income-tax Officer or the Appeal late Assistant Commissioner, but which finding did not become necessary for the determination of the assessment because a particular view of the assessee's liability was taken in the assessment proceedings, which view the Tribunal dissents from; or the same position is reached where the Tribunal may accept that view, but upon a reference the view is held to be not justified by the High Court. Therefore, the real question in this case is : Is it a new case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 was so found by the Income-tax Officer. We next come to the stage of the appeal before the-Appellate Assistant-Commissioner. In this case, the Appellate Assistant Commissioner confirmed the assessment and, therefore, the Appellate Assistant Commissioner also did not have to consider whether any portion of the sum of ₹ 6,02,911 was received in India and was taxable as such ; but let us consider for a moment what would have happened if the Appellate Assistant Commissioner had come to a contrary conclusion that income arising from the total sales of ₹ 6,02,911 was not taxable on the accrual basis under section 4(1)(c) of the Income-tax Act. The powers of the Appellate Assistant Commissioner are to be found in section 31 and sub-section (3)(b) of that section p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 which the Tribunal has made, and in making that order the, Tribunal had been extremely fair to the assessee in that they ware provided that, as the Income-tax Officer may not have in the first instance made as thorough an enquiry as he should have for the purpose of determining what part of ₹ 6,02,911 was received in British India, he should determine this matter afresh and assess such portion of the amount as may have been received in British India. In doing so, no doubt, the Income-tax Officer will also have to take into account any argument advanced on behalf of the assessee that a realisation in British India-is not necessarily a receipt in British India so as to attract the provisions of section 4(1)(a). In out opinion, therefore, the Income-tax Tribunal acted withi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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