- (1.) These appeals are preferred against an order of the Gujarat High court declining to direct the tribunal to state the question of law as suggested by the assessee. The questions of law suggested by the assessee are: (1 Whether, on the facts and in the circumstances of the case and on a proper interpretation of Section 254, the Tribunal was competent and justified in entertaining and deciding the preliminary point raised by the revenue. (2 Whether, on the facts and in the circumstances of the case and on a proper interpretation of Section 254, the tribunal was competent and justified in setting aside the assessment and restoring the matter to the income Tax Officer in the manner in which it has done.
(2.) Against the order of assessment for the Assessment Years 1969-70 and 1970-71, the assessee filed an appeal claiming certain deductions which were disallowed by the Income Tax Officer. The Appellate Assistant commissioner allowed those deductions. The order of the Appellate assistant Commissioner was challenged by the Revenue by way of an appeal before the tribunal. When the matter came up before the tribunal for final hearing, the Revenue raised, what is termed, a "preliminary point" to the effect that the Income Tax Officer while computing the income of the assessee Company had erroneously brought to tax income from agriculture and had also correspondingly allowed certain expenses in connection with the agricultural operations. It was argued that the assessee had earned income from agriculture which was not subject to tax and that by allowing expenses which were connected with the agricultural activities the Income tax Officer committed an error in making the assessment. The tribunal accepted the said preliminary objection, allowed the appeal and remanded the matter to the Income Tax Officer for making a fresh assessment. The tribunal observed: "Allowance or otherwise of the claim for various expenses made before us, in our opinion, would depend entirely on the question whether the impugned expenses are closely related to the agricultural activities of the assessee or not. We also feel that it will be unfair to deal only with the aspect regarding agricultural expenses without taking into consideration the fact that the assessee had also large-scale income from agriculture. It is, therefore, necessary, in our opinion that the income relating to the agricultural activities of the assessee company must be segregated and only non-agricultural income should be brought to tax. Since this aspect of the matter has been overlooked by the Income Tax officer, we think that in the interest of justice, we must set aside these assessments and restore the matter on the file of the Income Tax Officer so that he may re-make the assessments in accordance with law, in the light of our above observation. "
(3.) The assessee filed an application under Section 256 (1 asking the tribunal to refer the above questions which, on being declined, it went to the high court which also declined the assessee's request.;