NEK RAM SHARMA AND CO Vs. INCOME TAX APPELLATE TRIBUNAL

JUDGEMENT

(1.) THIS is an appeal under Section 260A of the Income-tax Act/1961 (the "Act") against the order of the Income-tax Appellate Tribunal dated August 31, 1999, by which the Income-tax Appellate Tribunal (the "Tribunal") remanded the matter to the Commissioner of Income-tax (Appeals) to decide the proper gross profit rate to be applied after giving an opportunity of hearing to both the assessee as well as the Assessing Officer and to pass a fresh order.

(2.) WE have heard learned counsel for the appellant, Ms. Sindhu Sharma, who submits that the Tribunal was not justified in remanding the matter to the Commissioner of Income-tax (Appeals) because it was obligatory on its part to consider the relevant facts and decide the proper gross profit rate itself. She submits that the question whether the Tribunal should have decided the matter instead of remanding the matter to the Commissioner (Appeals) is itself a question of law which should be examined by this court in an appeal under Section 260A of the Act. In support of the contention reliance is placed on the decision of the Supreme Court in Udhavdas Kewalram v. CIT [1967] 66 ITR 462.

(3.) THOUGH the expression "substantial question of law" has not been defined in the Act or in any of the statutes, where this expression appears, e.g., Section 100 of the Code of Civil Procedure, the true meaning and connotation of this expression is now well settled by various judicial pronouncements. There is a difference between a question of law and a substantial question of law. It is not a mere question of law but a substantial question of law that is required for the purpose of appeal under Section 260A of the Act. A question of law will be a substantial question of law if it directly and substantially affects the rights of the parties. In order to be "substantial" it must be such that there may be some doubt or difference of opinion or there is room for difference of opinion. If the law is well-settled by the Supreme Court, the mere application of it to particular facts would not constitute a substantial question of law.