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TMI Blog1992 (6) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. The assessee did not prefer further appeals before the Tribunal against the finding of the AAC confirming the reopening action of the WTO and, therefore, in law the said order of the AAC dated 28-12-1984 has become final. The assessee even in the appeals before the DC (Appeals) in the second round against the order of the Assessing Officer passed on 27-3-1987 did not raise any objection or ground assailing the reopening action of the WTO under section 17 of the Act. Thus, insofar as the assessee is concerned he is precluded from taking grounds in these appeals now before us again assailing and challenging the reopening action of the WTO knowing fully well that by virtue of the finding of the AAC in his order dated 28-12-1984 the reopening action has been confirmed and the order has thus reached finality and not open to challenge now at this stage. The departmental representative further stated that the reopening action of the WTO was on the basis of valuation report of the Departmental Valuation Officer (DVO) dated 26-12-1978 which constituted information enabling and empowering the WTO to act under section 17(1)(b) of the Act. It was, therefore, submitted by the learned depart ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . No reasons were given by the WTO for the reopening of the assessments. The assessee was also not informed whether the assessments were reoopened under section 17(1)(a) or under section 17(1)(b). The assessee complied with the reopening notices and filed returns for those assessment years. The reassessments were made on 19-1-1980 for an the four years. Not being satisfied the assessee preferred appeals before the AAC challenging the reopening action as well as the valuation of his share in the property in question. The AAC while disposing of the appeals set aside the assessments made on 19-1-1980 and remanded the matter back to the file of the WTO with a direction to make fresh assessments in accordance with law. In so far as the challenge of the reopening action is concerned which was assailed before the AAC the same was confirmed by him and the assessee's ground was dismissed. The order of the AAC dated 28-12-1984 is at pp. 29-31 of the paper book. After the remand the WTO made the assessments again on 27-3-1987 under section 16(3) read with section 23 of the Act. Aggrieved against the assessments made for all the year appeals were preferred before the DC(Appeals). The DC(Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the assessee is properly and validly assessed and directed to pay proper and legitimate tax as per law. The assessee is, therefore, permitted in law to raise a plea challenging the very jurisdiction of the WTO in resorting to the provision of section 17 of the Wealth-tax Act as it goes to the very root of the matter. To support the argument advanced the assessee's counsel has relied on the below given decisions : (i) N. Nagartat ha Iyer v. CIT [1966] 60 ITR 647 (Mad.) ; (ii) CIT v. Mahalakshmi Textile Mills Ltd. [1967] 66 ITR 710 (SC) ; (iii) CIT v. Shree Ganesh Jute Mills Ltd. [1977] 109 ITR 562 (Cal.) ; (iv) P. V. Doshi v. CIT [ 1 978] 113 ITR 22 (Guj.), and (v) Inventors Industrial Corpn. Ltd. v. CIT [1992] 194 ITR 548 (Bom.). 5. The learned departmental representative as recorded by us above urged that the assessee should not be permitted to raise the plea of jurisdiction of the ITO in reopening the assessments in these appeals now. In support of his argument he has relied upon the below given decisions : (i) Orient Tradirtg Co. Ltd. v. CIT [1965] 58 ITR 553 (Cal.) ; (ii) Manji Dana v. CIT [ 1966] 60 ITR 582 (SC) ; (iii) R.K. Sawhney v. CIT [1987] 166 ITR 128 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer or about the jurisdiction, power and authority of the Assessing Officer. The sum and substance, in our view, of all those decisions is that if an assessee accepts a finding on facts of any appellate authority without there being any further challenge as laid down in law then such finding of facts became final and the assessee is stopped from agitating further in later appeals thereby offending the rule of finality and res judicata. 8. From the various decisions cited by the assessee's counsel we find that the fact before the Gujarat High Court in the case of P.V. Doshi appear to be, more or less, similar to the facts of the instant case. In the Gujarat High Court's case the assessments of the assessee were reopened and the assessee challenged the validity of reopening notice and also the addition made. On appeal to the AAC the assessee gave up the challenge to the reopening action of the ITO but only assailed the addition made. The AAC dismissed the appeal and confirmed the addition made by the ITO. On second appeal to the Tribunal the challenge was on merits but not about the validity of the reopening action. The Tribunal restored the matter to the file of the ITO for fur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the earlier occasion and that ground having been given up by the assessee it could not be said that the assessee was still aggrieved by the said decision. That is why, at the earlier stage before the Tribunal this ground was not even mentioned or taken in the grounds of appeal. The Tribunal, therefore, took the view that once the Tribunal passed a final order the matter became final with regard to the point which was settled by the AAC and which was not agitated before the Tribunal nor taken up to the High Court. The Tribunal also held that the order restoring the case to the file of the ITO with clear directions regarding the examination of witness clearly mean that the only point that was left upon was in respect of the addition and not the legal or jurisdictional aspect whether the reassessment proceedings were correctly initiated under section 147/148 or not. The assessee having raised that point and then having given up before the AAC could not revive the point again in the second round. The departmental appeal was allowed by the Tribunal on this point. On a reference at the instance of the assessee the Gujarat High Court after elaborate discussion with reference to the sev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estoppel or by res judicata. Their Lordships in terms held that the principle was that neither estoppel nor res judicata could give the court jurisdiction under the Act which those Acts said it was not to have. Therefore, bar of res judicata or estoppel or waiver were negatived in such a case where the plea was outside the ambit of the Rent Control Act, for the simple reason that as one could not confer jurisdiction by consent, similarly one could not by agreement waive exclusive jurisdiction of rent courts over the buildings in question. It is true that section 254(4) in terms provides that save as provided in section 256 (which provides for the reference to the High Court), orders passed by the Appellate Tribunal on appeal shall be final. That finality or conclusiveness could only arise in respect of orders which are competent orders with jurisdictions and if the proceedings of assessment are not validly initiated at all, the order would be a void order as per the settled legal position which could never have any finality of conclusiveness. If the original order is without jurisdiction it would be only nullity confirmed in further appeals. If the essential distinction is borne i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e earlier stages. The assessee is entitled to challenge the jurisdiction of the Income-tax Officer to initiate reassessment proceedings before the Appellate Assistant Commissioner in the second round of proceedings even though he had not raised it earlier before the Income-tax Officer or in the earlier appeal. The powers of the first appellate authority, whether the Appellate Assistant Commissioner or the Commissioner of Income-tax (Appeals), are coterminous with that of the Income-tax Officer. The appellate authority has jurisdiction to entertain a ground regarding jurisdiction to make reassessment in an appeal following remand." 10. The judgment of the Supreme Court in the case of Mahalakshmi Textile Mills Ltd. lays down that all questions of law of fact which relate to the assessment of the assessee can be raised before the Tribunal and the right of the assessee is not restricted to the pleas raised by him. 11. The decision of the Calcutta High Court in the case of Shree Ganesh Jute Mills Ltd. is to the effect that the assessee can raise a new ground though not raised in the original appeals filed against the original assessments. 12. After analysing the above decisions we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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