Chagla, C.J. - (1.) The question that arises in this reference is whether a certain order passed by the Appellate Assistant Commissioner was an order under Section 30(2) or an order under Section 31. If the order was under Section 31 it was appealable, if it was one under Section 30(2) no appeal could lie under that order. The Tribunal has taken the view that the order was under Section 30(2) and therefore refused to entertain the appeal preferred by the assessee from that order, and the question submitted to us by the Tribunal in substance raises this question.
(2.) Now, a few facts might be stated. The assessment order was passed on the 30th of April, 1949, and the notice of demand was served upon the assessee on the 13th of February, 1950. The last day for preferring the appeal to the Appellate Assistant Commissioner was the 16th of March, 1950. For certain reasons which it is not necessary to go into at the present stage, the assessee did not post the memo. of appeal from Ahmednagar where he was living up to the 16th of March, 1950, and the petition for appeal reached the Appellate Assistant Commissioner in Poona to whom it was posted on the 18th of March, 1950. Therefore, when the petition for appeal reached him it was clearly out of time by two days. On the 5th of May, 1950, a notice was issued by the Appellate Assistant Commissioner calling upon the assessee to show cause why his appeal should be condoned. Then on the 1st of September, 1950, a notice was issued by the Appellate Assistant Commissioner under Section 31 to the effect that the appeal preferred by the assessee had been received and registered by the office of the Appellate Assistant Commissioner and 19th of September, 1950, was fixed for hearing and final disposal of the appeal at Ahmednagar and the assessee was informed that he should appear in that office in person or by an authorised agent or by a pleader duly instructed who would be able to answer all material questions arising in the appeal. He was further informed that in default of his appearance on the day mentioned the appeal will be heard and determined in his absence. Pursuant to this notice the appeal was heard on the 19th of September, 1950, and it is not disputed that the appeal was heard on merits by the Appellate Assistant Commissioner. Ultimately on that day he passed an order to the effect that he saw no reason why the assessee could not submit the appeal petition within the period of limitation. The Appellate Assistant Commissioner, therefore, expressed the opinion that he was unable to condone the delay and the order he passed was that the appeal was rejected as time-barred, and the question arises whether on these facts the order of the Appellate Assistant Commissioner falls under Section 31 or under Section 30(2).
(3.) Now, in our decision in K. K. Porbunderwalla v. Commissioner of Income-tax, Bombay City, we considered the scheme of Section 30 and 31 and we pointed out that there was an intermediate stage between the presentation of the appeal and the hearing of the appeal as provided by the last clause of Section 30(2) and that intermediate stage relates to those appeals which were out of time, but for which the appellant asked for condonation of the delay from the Appellate Assistant Commissioner and it was left to the decision of the Appellate Assistant Commissioner whether to condone or not to condone the delay. It is clear that it is only after that intermediate stage is passed that it is competent to the Appellate Assistant Commissioner to issue a notice fixing a day and place for the hearing of the appeal under Section 31. Now, in this case as already pointed out, in order to decide whether the delay should be condoned or not, the Appellate Assistant Commissioner actually issued a notice to show cause upon the assessee on the 5th of May, 1950. The assessee showed cause on the 11th of May, 1950. It was open to the Appellate Assistant Commissioner to decide that no sufficient cause had been shown by the assessee for condonation of the delay. But instead of coming to that conclusion the Appellate Assistant Commissioner on the 1st of September, 1950, issued a notice under Section 31 and fixed the hearing of the appeal for the 19th of September, 1950. Now, it is clear that the notice was issued under Section 31 and the hearing of the appeal was also fixed under Section 31. Therefore the ultimate order that the Appellate Assistant Commissioner passed was also under Section 31.;