- (1.) THE Tribunal, Delhi Bench, New Delhi has referred the following questions of law under s. 256(1) of the IT Act, 1961 (the Act), for opinion to this Court : "1. Whether, in law and circumstances of the case, the Tribunal was justified in holding that the assessee -trust was not hit by cl. (b) of sub -s. (2) of s. 13 r/w s. 13(1)(c) of the IT Act, 1961 ? 2. Whether, in law and circumstances of the case, the Tribunal was justified in holding that assessee -trust was a public charitable (trust) and its income was exempt under ss. 11 and 12 of the IT Act, 1961 -
(2.) THE reference relates to the years 1977 -78, 1978 -79 and 1981 -82.
(3.) BRIEFLY stated the facts giving rise to the present reference are as follows : The assessment orders for the asst. yrs. 1977 -78 and 1978 -79 are fresh assessment orders after the original assessment orders were set aside by the then CIT(A) with the direction to consider the judgment of the Settlement Commission under s. 245D(4) for the asst. yrs. 1967 -68 to 1970 -71 and 1972 -73 to 1976 -77. These orders were passed passed fresh assessment orders holding that the income was not so exempt on the ground that a Special Leave Petition had been filed before the Hon'ble Supreme Court against the judgment of the Settlement Commission. The assessment for the asst. yr. 1981 -82 is an original assessment, where the income has been held to be taxable and not exempt as a public charitable trust for the same reasons as for asst. yrs. 1977 -78 and 1978 -79. The CIT(A), after considering the facts and circumstances of the case, held that the provisions of s. 13(2)(b) were not applicable and the assessee cannot be denied exemption under ss. 11 and 12 due to this reason. As regards asst. yrs. 1977 -78 and 1978 -79, the CIT(A) found that his predecessor has set aside the assessment orders for the above years and directed the ITO to take into consideration the judgment of the Settlement Commission and thus limited the scope of enquiry by the ITO. The CIT(A), therefore, held that the ITO was not authorised to raise the issue of applicability of s. 13(2)(b) in the fresh assessments for these two years. He, accordingly, annulled the finding of the ITO in this regard. The Department came in appeal to the Tribunal. After considering the submissions, the Tribunal dealt with the matter in the following words : "5. We have considered the submissions of the parties and have gone through the orders of the authorities below. We agree with the submissions of the Authorised Representative for the assessee that the assessee preferred appeals before the CIT(A) and he has considered the implication of s. 13(2)(b) of the Act for the assessment years under appeal. It is, therefore, not correct to say that the CIT(A) has not considered the implication of s. 13 of the Act before allowing exemption. It is also true that the Department has not taken specific ground to assail the finding of the CIT(A) that he has not considered the implications and limitations as laid down in s. 13 of the Act. It is also clear from the order of the CIT(A) that he has considered the provisions of s. 13(2)(b), and the Department cannot raise fresh plea at this stage without raising an additional ground. Since no additional ground has been taken, we refuse to consider the fresh plea taken by the Departmental Representative. Now, the only point for adjudication before us whether the CIT(A) was justified in holding that the assessee -trust is exempt as wholly charitable trust when the matter was still sub -judice and the Special Leave Petition was pending before the Hon'ble Supreme Court. The Departmental Representative failed to state before us whether the Special Leave Petition was still pending or has since been decided. As already stated, since the additional plea raised by the Departmental Representative cannot be agitated before us, therefore, we refuse to adjudicate upon the same. Now the remaining grounds taken by the Department are squarely covered in favour of the aforesaid decision, we are of the opinion that there is no force in these appeals." ;