Sabyasaciii Mukharji, J. - (1.) In this case while making the assessment under the I.T. Act, for the year 1959-60, the ITO disallowed the assessee's claim for deduction of Rs. 37,879 being wealth-tax paid by it. The assessee went up in appeal to the AAC. There were several grounds of appeal before the AAC including the one relating to the disallowance of wealth-tax paid. The assessee, however, did not press this particular ground relating to the wealth-tax and the AAC confirmed this disallowance. The assessee raised the above points before the Tribunal as an additional ground along with other grounds for this assessment year. The Tribunal observed that this ground was not pressed by the assessee before the AAC, because at that time the law was as laid down by the Supreme Court in the decision of Travancore Titanium Product Ltd. v. CIT [1966] 60 ITR 277 and the law was that wealth-tax was not a permissible deduction. But later on in the decision in the case of Indian Aluminium Co. Ltd. v. CIT [1972] 84 ITR 735, the Supreme Court held that wealth-tax was deductible from the computation of income in certain specified cases. Following the later decision, the Tribunal held in the instant case that the wealth-tax paid by the assessee amounting to Rs. 37,879 was business expenditure and as such deductible. Meanwhile, the Income-tax (Amendment) Ordinance was promulgated by the President of India on 16th July, 1972, and thereafter it was followed by the Income-tax (Amendment) Act, 1972. As some arguments were made in respect of the same it is relevant to set out Section 2 and Section 4 of the said Act (See [1972] 85 ITR (St.) 163) : " 2. Amendment of Section 40.--In Section 40 of the Income-tax Act, 1961 (43 of 1961) (hereinafter referred to as " the principal Act "), after Sub-clause (ii) of Clause (a), the following sub-clause shall be, and shall be deemed always to have been, inserted, namely :-- ' (iia) any sum paid on account of wealth-tax......' " "4. Wealth-tax not deductible in computing the total income for certain assessment pears.--Nothing contained in the Indian Income-tax Act, 1922 (11 of 1922), shall be deemed to authorise, or shall ba deemed ever to have authorised, any deduction in the computation of th" income of any assessee chargeable under the head ' Profits and gains of business, profession or vocation ' or ' Income from other sources ' for the assessment year commencing on the 1st day of April, 1957, or any subsequent year, of any sum paid on account of wealth-tax."
(2.) Thereafter, the revenue filed miscellaneous application on the 30th of September, 1972, before the Appellate Tribunal praying before the Tribunal to amend suitably its earlier order dated 12th of July, 1972, so that the direction by the Tribunal to the ITO is cancelled. The Tribunal found that a similar matter had come up before it and it had held that in a matter which had been given finality under Section 24(10) of the W.T. Act, 1957, the Tribunal had no power under Section 254(2) of the I.T. Act, 1961, to amend or modify. In the premises, the Tribunal rejected the said application. Upon that, at the instance of the revenue, the following question has been referred to this court by the Tribunal : " Whether, on the facts and in the circumstances of the case and in view of the promulgation of the Income-tax (Amendment) Ordinance, 1972, and the subsequent amendment made to the Income-tax Act, 1961, the Tribunal was right in holding that there was no rectifiable error in its order dated 12th July, 1972, and in that view of the matter dismissing the miscellaneous application made by the department ? "
(3.) Learned advocate for the assessee is right in contending that, the question as framed is incorrect, because the expression " and the subsequent amendment made to the Income-tax Act, 1961 ", is misconceived. The subsequent amendment to the Income-tax Act, 1961, does not affect the position. He, therefore, submitted that the court has to adjudicate on a controversy which was not before the Tribunal. We are, however, unable to accept this contention. The controversy was whether the Tribunal was justified in allowing the deduction of wealth-tax in view of the subsequent alteration of law, later on made. If that is the proper controversy, then even though the expression "subsequent amendment to the Income-tax Act, 1961 ", is incorrect, the real controversy was whether the deduction of wealth-tax was correctly allowed or not. In that view of the matter, we reframe the question as follows : " Whether, on the facts and in the circumstances of the case and in view of the Income-tax (Amendment) Act, 1972, the Tribunal was right in holding that there was no rectifiable error in its order dated 12th July, 1972, and in that view dismissing the miscellaneous application made by the department ? ";