RAMANARAYANA DAS MADANLAL Vs. COMMISSIONER OF INCOME TAX
HIGH COURT OF ORISSA
RAMNARAYANA DAS MADANLAL
COMMISSIONER OF INCOME TAX
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RAY, J. -
(1.) UNDER S. 66 of the IT Act, this Court asked the Tribunal to state a case which has since been done.
The questions referred to us are:
" Whether the order passed by the AAC, dismissing the assessee's appeal on the ground of its incompetence, according to the proviso to Sub -S. (1) of S. 30 of the Act, is one under S. 31 and as such appealable under S. 33(1) of the Act; and (2) Whether such an order passed before expiry of the time either as originally fixed or later extended by competent authority for payment of the tax is good in law ?"
Of the two questions the second one strictly falls within the scope of the appeal before the Tribunal
in the event of our answer to question No. (1) being in the affirmative.
(2.) WHEN the appeal goes back to the Tribunal it will be for them to consider whether the order of extension, if any, granted by the IT authorities was a valid order and would conduce to the
assessee being considered for the purpose of the proviso to S. 30 as one who has not committed
any default, or who has not been in arrears in respect of income -tax. We have not been posted
with all the facts and circumstances which should have enabled us to answer this question with any
amount of certainty. We, therefore, leave the question at large.
With regard to question No. (1) our answer should be in the affirmative. As the point has been thoroughly discussed in the preliminary order issuing a writ to the Tribunal to state a case, I do not
like to reiterate what I have stated before. At this stage a decision of the Bombay High Court
reported in CIT vs. Mysore Iron & Steel Works (1949) 17 ITR 478 (Bom) : TC8R.193 has been cited
before us. The position, however, is clear, namely, that the order impugned of the AAC cannot but
be one under S. 31 of the Act. According to Sub -S. (1), S. 30, certain orders as defined in the said
sub -section are made appealable. An order under Sub -S. (1) of S. 46, that is, an order levying a
penalty upon an assessee for non -payment of income -tax within the due date, is one such. The
proviso limits the right of appeal to those persons who must have paid the tax; or in other words,
to those who must not have been in arrears in respect of the payment of the tax. When an appeal
is filed against this order, it is a matter for consideration of the appellate authority whether such an
appeal does lie, or, in other words, whether the appeal is competent, that is to say, whether the
assessee -appellant has fulfilled the conditions which are pre -requisite for an appeal. Within the
provisions of S. 31, there is nothing to empower an appellate authority to pass any order by way of
admitting an appeal. Admission of an appeal has not been sufficiently provided for within the
purview of the IT Act, but it is not strange to the scheme of the Act. By contrast, I refer to the
admission of an appeal as provided for in the concluding portion of Sub -S. (2) of S. 30. That sub -
section provides, in the main, a time limit for appeals of various classes, the starting points of such
time - limits varying according to the circumstances of each of the cases mentioned therein. The
sub -section concludes with the following words: "But the AAC may admit an appeal after the
expiration of the period if he is satisfied that the appellant had sufficient cause for not presenting it
within that period". This makes it clear that the stage of admission is interposed between the
presentation of an appeal and its hearing and disposal under S. 31 in cases in which an appeal is
not presented within the prescribed time -limit. The necessary inference, therefore, is that in all
other cases the appeal, as soon as presented, must come up for decision under S. 31.
(3.) LOOKING to how the matter was treated by the AAC in the instant case, it is clear that he had fixed a date and place for the hearing of the appeal and had invited all the concerned parties. In
case we thought any notional stage of admission to be intervening, which according to me is not so
much necessary, that stage, according to the appellate authority, had already passed. He had set
down the appeal for the purpose of hearing. The matter of hearing is provided for in S. 31 and S. 31
alone. There is no other provision in the Act under which an appeal could be disposed of. Under the
circumstances, the order disposing of the appeal is an order under S. 31. Its character as an order
under that section does not depend upon the ground on which the order proceeds. The ground may
be one of a preliminary character but when decided one way or the other, and particularly when it
is decided against the assessee, it goes to the root of the matter and amounts to a final disposal of
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