TMI Blog1982 (12) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... o the decision of this court striking down section 34(1)(c) as unconstitutional in the manner aforesaid. Their decision not to sustain the inclusion of the lineal descendant's share in the principal value of the deceased's estate was, therefore, quite in keeping, as it ought to be, with the decision of this court in V Devaki Ammal's case[1973] 91 ITR 24 (Mad). Our answer to the question, therefore, is in the affirmative and against the Department. The other question of law which we are asked to decide in this case is as follows : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the additional ground raised by the accountable person before the Tribunal regarding the validity of inclusion of the lineal descendant's share under section 34(1)(c) in the principal value of the share was permissible even though the admission of such additional ground raised an entirely new point which went beyond the scope of the appeal as originally filed by the accountable person ?" As we earlier pointed out, the Tribunal had upheld the contention of the accountable person that the lineal descendant's share cannot be clubbed along ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ering this question, we think, it is permissible to regard the Act, as belonging to a group, or joint family of direct tax enactments, the other fiscal measures being the Income-tax Act, 1961, the Wealth-tax Act, 1957, the Gift-tax Act, 1958, and so on. Under all these taxing enactments which form an integrated direct tax system, the Tribunal has the same role to play, namely, the role of the ultimate appellate authority on fact and the penultimate decision-making authority on law. It may also be stated as a general observation covering all these enactments, that an order of assessment can be questioned in an appeal before the first appellate authority and subsequently before the Tribunal by way of a further appeal against the order of the appellate authority. In both the appeals, the subject of controversy would be the order of assessment. common feature of these enactments levying direct taxes is than an appeal before the Tribunal may be preferred either by the taxpayer or by the taxing authority. There may be slight variations between one direct tax and another in the enumeration of the Tribunal's powers in appeal. But, by and large, we may take it that the Tribunal has got the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. The Supreme Court held that the Tribunal possessed the requisite power to entertain that new point. Referring to the rules framed by the Tribunal for regulating their own procedure, the Supreme Court held that those rules including the one relating to additional ground and the like are merely self-regulating in character and do not in any way circumscribe, or control, the power of the Tribunal as an appellate body under the Income-tax Act. In Mahalakshmi Textile Mills Ltd.'s case [1967] 66 ITR 710, the Supreme Court held that there was nothing in the Income-tax Act, which restricted the Tribunal to the determination of questions raised before the departmental authorities, but, on the contrary, all questions, whether of law or of fact, which related to the assessment of the assessee may be raised before the Tribunal. The court proceeded to hold that in such cases, it would be open to the Tribunal and, indeed, they would be under a duty, to grant relief, on the principle that the right of the assessee to relief is not restricted to the plea raised by him before the departmental authorities. This trilogy of the Supreme Court cases, all of them addressed to the precise coverage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial powers under the Constitution, had struck down a part of the statute as violative of article 14, that decision has got to be given effect to by the Tribunal, the moment their attention was drawn to it, in the appeal. The Tribunal could not very well ignore the effect of this court's decision nullifying section 34(1)(c) merely on the feeble technicality that it had not occurred to the accountable person to invoke the decision of this court at any earlier stage of the proceedings. We are, therefore, satisfied that the Tribunal acted perfectly legitimately when they entertained the objection to the inclusion of the lineal descendant's share and rendered their decision in accordance with the ruling of this court in V Devaki Ammal's case [1973] 91 ITR 24 (Mad). This conclusion of ours is based on our summation of the three decisions of the Supreme Court we have earlier discussed. Learned counsel for the Department referred to a recent decision of the Supreme Court in Addl. CIT v. Gurjargravures (P.) Ltd. [1978] 111 ITR 1. We do not think this decision of the Supreme Court can be regarded as going against the grain of the three earlier Supreme Court decisions though none of them in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oard, by implication, all these well-considered judgments. Although we have considered the scope of the Tribunal's appellate jurisdiction purely on the basis of the decisions of the Supreme Court, we must mention that there is yet another way of reaching the same conclusion, especially that expressed by the Supreme Court in Mahalakshmi Textile Mills Ltd. 's case [1967] 66 ITR 710. In that case, as a matter of construction of the Indian Income-tax Act, the court held that there was nothing in the taxing statute which restricts the Tribunal to the determination of the questions raised before the assessing authority and all questions, whether of law or of facts, which relate to the assessment, can be raised before the Tribunal. This conclusion can be arrived at by considering the essentials of fiscal jurisprudence. The central purpose of any taxing enactment is to relieve the taxpayer of some of the contents of his purse. All the same, it is part of the fundamental jurisprudence of liberal democracies, such as ours, that the tax which can be levied on, and collected from, the taxpayer must be precisely that which is sanctioned by statute passed by an accredited legislature. No taxat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... humanly possible, to the correct pie and make it accord with the relevant taxing provisions. If an assessing authority for any reason, either owing to ignorance or overzealousness or sheer devilment, makes an over-assessment and an appeal is carried from his order, the function of the appellate authority in that appeal is to set right the assessment and adjust the taxpayer's liability in accordance with the statutory provisions. In the appeal, as in the assessment, the task is one of adjustment of the taxpayer's liability. This is a phrase which English judges are fond of employing in discussion of tax matters. The function of a tax appeal is thus precisely the same as that of a tax assessment. All other questions are irrelevant in a discussion as to what the scope of a tax appeal is for the scope of the appeal is the same as the scope of the assessment The statute sometimes confers on the appellate Tribunal, the power of enhancement of tax in which event also the scope of the appeal is only the scope of the assessment. Enhancement is only in the nature of a supplementary assessment. The power of enhancement implies that the Tribunal has power to do what the assessing authority ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... courts. Those who preside over the Tribunals, as well as the professional gentlemen who practise before them, might have been instrumental in endowing these bodies with the aura or the external trappings of appellate courts. But that is no reason why we should regard these bodies as replicas of appellate courts functioning in civil litigation, and hem them in on all sides by procedural shackles and technical rules of all kinds which really hinder the administration of fiscal justice according to law. These are the philosophic, or basic, considerations on which we have got to comprehend the real scope of the jurisdiction of the Tribunal in an appeal. In recent decision of a Full Bench of this court, this broad approach had been pursued for determining the scope of the appellate powers of a similar tax Tribunal, namely, the Sales Tax Appellate Tribunal in State of Tamil Nadu v. Arulmurugan Co. [1982] 51 STC 381 (Mad). The decision of the Full Bench in this case is an echo of one of the judgments rendered in an earlier sales tax case in Dy. Commissioner v. Govindaraju Chettiar [1980] 46 STC 341 (Mad). The Full Bench, while dealing with the powers of the Sales Tax Appellate Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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