TMI Blog2001 (3) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in Hari Ram v. Asstt.. CED [1975] 101 ITR 539 taking, the view contrary to that of the Madras High Court included the shares of the lineal descendants. The matter rested at that till an application dated 11-2-1984 was moved by the A.Ps. requesting for rectification under section 61 of the Estate Duty Act. The request was inspired by a report under the heading "From our reporter at the Supreme Court" appearing in 143 ITR page 67 (Statutes) about the Supreme Court dismissing a Special Leave Petition filed by the Department against the judgment of the Madras High Court reported in CED v. R.K. Chettiar [1980] 125 ITR 605. In that report, it was mentioned that in R.K. Chettiar's case the Madras High Court on a reference had held that where lands were gifted by the deceased but the income there from was used by him in his business, the value of lands gifted could not be included in the principal value of the estate, and also held following V. Devaki Ammal's case that the lineal descendants'share could not be included in the ancestral property. The rejection of S.L.P. by the Supreme Court was taken to be the approval of the Madras High Court decision in V. Devaki Ammal's case and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the grounds urged was that there was no mistake apparent from the record, which could be rectified within the meaning of section 61 of the Estate Duty Act. It is this point, which has been considered by the Appellate Controller of Estate Duty and resulted in the success of the A.Ps. and cancelling of the order of the ACED under .section 61. It was made out before him on behalf of the A.Ps. that there were different views of different High Courts on the same issue and, therefore, a debatable issue was involved, which could not be governed by the provisions of section 61 of the Estate Duty Act. The counsel referred to the Punjab and Haryana High Court decision in HariRam's case on the one hand and the opposite view taken by the Madras High Court and the Allahabad High Court in R.K. Chettiar's case and Badri Vishal Tandon v. CED [1982]136 ITR 427 (and not 468 as mentioned in the order of the Appellate Controller) respectively. The Appellate Controller accepted that plea and held that a debatable point of law was not a mistake apparent from records and hence he cancelled the order under section 61 of the Estate Duty Act. The Revenue is aggrieved with the order of the Appellate Con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssue decided by the Appellate Controller. A deeper analysis will clearly reveal the nature of mistake pointed out by the A.Ps. in the petition dated 11-2-1984, which resulted in the passing of an earlier order under section 61 dated 31-3-1984 and also later on necessitated the passing of impugned order under the same section. The application of the A.Ps. clearly brought out the nature of the mistake and we quote an extract from para 1 of that application :--- "Following this ruling of the Madras High Court, the Hon'ble Supreme Court held that share of lineal descendants are not includible. Thus this is a mistake apparent from the record and may be rectified under section 61 and principal value of estate may be redetermined after excluding share of lineal descendants included for rate purposes amounting to Rs. 14,63,707." The language of the first sentence is clearly incorrect inasmuch as it says that the Supreme Court followed the ruling of Madras High Court in V Devaki Ammal's case it is that ruling which is referred to in that sentence. The Assistant Controller also understood the report in 143 ITR 67 (Statutes) to be bringing out that the Supreme Court had approved the Madra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts was includible or not. Even viewing from this angle in the alternative, the A.Ps. do not deserve to succeed in view of the law laid down in such circumstances by the Punjab and Haryana High Court in the case of CIT v. Mohan Lal Kansal (3 Partners) [1978] 114 ITR 583. A similar controversy under the Income-tax Act came up for the consideration of the High Court and the High Court held that the Income-tax Authorities situated within the jurisdiction of particular High Court are bound by the decision and rejected the view taken by the Tribunal that a debatable question was involved as there was a conflict of opinion on the issue under consideration amongst the Courts. The High Court held that as long as the Punjab and Haryana High Court authority stood, it could not be said that the mistake was not apparent on the record or that it required a long drawn process of reasoning to discover the same and the Income-tax Authorities were bound to follow the rule laid down in that case. The position in law, therefore, is settled so far as the jurisdiction of Punjab and Haryana High Court is concerned in the facts and the circumstances of this case. It is undisputed that in Hari Ram's case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excluded the share of the lineal descendants from the estate. 13. Later on the Assistant Controller of Estate Duty found that the point in the case of V. Devaki Ammmal is still pending disposal before the Hon'ble Supreme Court in other cases, and the fact that the Special Leave Petition was dismissed against the decision in the case of V. Devaki Ammal could not be taken to mean that the Supreme Court had impliedly approved the Madras High Court decision in V. Devaki Ammal's case Reliance can be placed on the covering page of issue dated 16-4-1984 of 146 ITR, Part 7. Thus, the Assistant Controller of Estate Duty issued notice under section 61 of the Act to the A.Ps. proposing therein the rectification of his earlier order, so as to include the share of lineal descendants of the deceased in the ancestral property. The A.Ps. contested the notice issued by the Assistant Controller of Estate Duty and thereby contended that the Assistant Controller of Estate Duty had no power to rectify his order, approved by the Deputy Controller and moreover, the issue involved in the case is highly debatable. The Assistant Controller of Estate Duty rejected the contentions of the A.Ps., which was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s an appeal, against the rectified order in the Tribunal, then the Tribunal is to follow the principles or ratio laid down by the Hon'ble Supreme Court in the case of Volkart Bros. However, in appeals, where the order appealed is not under section 154 of the Act, then the decision of the Hon'ble High Court, within the jurisdiction of which the Bench of the Tribunal is functioning is to be followed, though there are decisions of the Hon'ble Supreme Court, holding that the view favourable to the assessee to be followed by the Tribunal. 19. Thus, keeping it in mind and with great respect to the views of my learned brother and the decision of the Hon'ble Punjab and Haryana High Court, relied upon by him, I hold that where issue involved is arising from the rectified order in the appeal before the tribunal, is debatable, then the Tribunal in such appeal is to follow the decision of the Hon'ble Supreme Court supra and not that of the Hon'ble High Court, supra on the ground that the Bench of the Tribunal is functioning within its jurisdiction and hence the decision is binding on it. 20. It is Hon'ble Supreme Court that lays the law of the land and not the Hon'ble High Court. Further v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the angle of administration in the Income-tax Deptt. 24. In view of my above discussion and reasons, thereto. I am of the considered opinion that in this case on the issue involved debate is there and, therefore, no mistake apparent from the record is there, which needs to be rectified. Accordingly, I confirm the impugned order and thereby dismiss the appeal of the Revenue. 25. In the result, the appeal is dismissed. In this case there is a difference of opinion among us both, therefore, no make reference to settle it to the worthy President of the Tribunal. Hence, we frame the following questions for the purposes. "1. Whether, on the facts and in the circumstances of the case, the debate is involved on the issue : whether the share of the lineal descendants is to be included in the estate of the deceased for rate purposes, particularly, when the decisions in the cases of Devaki Ammal and Hari Ram of Madras and Punjab and Haryana High Courts are opposite to each other on the issue." 2. "Whether, on the facts and in the circumstances of the case, it can be held that there is a decision of the Hon'ble Punjab Haryana High Court in the case of Hari Ram v. ACED, 101 ITR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of T.S. Balram, ITO, Co. Cir. IV, Bombay v. Volkart Brothers Ors. 82 ITR 50 says otherwise ? 3. Whether, on the facts and in the circumstances of the case, the Assistant Controller of Estate Duty is competent to rectify of his own the order made with the approval of the Deputy Controller of the Estate Duty ?" By the Accountant Member : "Whether, there was a mistake apparent from the record in the order of the Assistant Controller of Estate Duty dated 31-3-1984 which could be rectified by him by his subsequent order dated 25-5-1984 ?" 2. The facts of the case are fully brought on record by the learned Accountant Member and the Judicial Member. The point of difference was whether the issue is debatable in view of the conflicting decisions of the jurisdictional High Court in the case of Hari Ram and of the Madras High Court in the case of V Devaki Ammal 3. At the hearing before me none appeared on behalf of the assessee. After hearing Shri Tarsem Lal, the learned Sr. D.R., I am of the view that this issue is finally settled by the Hon'ble Supreme Court in Asstt. CED v. V. Devaki Ammal [1995] 212 ITR 395. Since the Hon'ble Supreme Court has reversed the decision of the Hon' ..... X X X X Extracts X X X X X X X X Extracts X X X X
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