Chaman Lal Amar Nath and Co. vs Commissioner of Income Tax

Ajay Tewari, J.—This is an appeal by the assessee against the order dated 14-9-2007 whereby the Income Tax Appellate Tribunal, Amritsar dismissed its appeal for the assessment year 1988-89.

The assessee, a rice seller, filed return declaring total income at Rs. 65,785 claiming a shortage of 19.60 per cent. The Assessing Officer allowed shortage due to moisture, dust, dirt and other foreign material etc., only to the extent of 9.60 per cent and accordingly made disallowance with respect to 10 per cent of the shortage. In appeal, the Commissioner of Income Tax deleted the addition made by the Assessing Officer. The matter was carried up by the revenue before the Tribunal which, vide its order, Annexure A-3, remitted the matter back to the Commissioner to decide the issue afresh with regard to the reasonable yield rate on the basis of the opinion of an expert.

On remand, the Commissioner again upheld the order holding shortage of yield of 10 per cent. Against the said order, the assessee preferred an appeal which has been dismissed by the Tribunal vide the impugned order.

The assessee is before us proposing the following questions of law:

(i) Whether in the facts and circumstances of the present case in view of the judgments of the Hon''ble Supreme Court when the department has allowed the claim of the assessee in previous as well as subsequent years and also in the case of other assessee carrying on the same business?

(ii) Whether in the facts and circumstances of the present case the impugned orders Annexures A1, A4 and A5 are legally sustainable in the eyes of law when the department has allowed the deduction in various other similar cases and denying the same deduction to the assessee?

While arguing the matter Mr. Akshay Bhan, learned Counsel for the appellant, has mainly assailed the action of the Tribunal in not holding the Commissioner to the earlier direction whereby the matter had been remitted back for a finding on the basis of the opinion of an expert. According to the learned Counsel, the earlier order of the Tribunal was binding and violation thereof by the Commissioner and the subsequent inaction of the Tribunal on this score is completely illegal.

A perusal of the order of the Commissioner and that of the Tribunal reveals that the question of fact regarding reasonable yield has been considered by both the authorities on various parameters. As regards the argument regarding the infraction of the remand order, in our opinion, it was for the Tribunal to take a decision regarding the effect of the infraction of the condition of taking the opinion of an expert. In the present case, the Tribunal has satisfied itself that the conclusion regarding the yield arrived at by the Commissioner could not have been held to be erroneous. In any case, the said order of remand or the conditions thereof would not bind this Court. In Jasraj Inder Singh Vs. Hemraj Multanchand, , the Hon''ble Supreme Court held as follows:

In an appeal against the High Court''s finding the Supreme Court is not bound by what the High Court might have held in its remand order. It is true that a subordinate Court is bound by the direction of the High Court. It is equally true that the same High Court, hearing the matter on a second occasion or any other Court of co-ordinate authority hearing the matter cannot discard the earlier holding, but a finding in a remand order cannot bind a higher Court when it hears the matter in appeal.

In view of the above-mentioned parameters, we have examined the two judgments and find that no error can be pointed out in the assessment of reasonable yield. In this view of the matter, we are unable to hold that any substantial question of law arises in this Appeal. Consequently, the present appeal is dismissed with, however, no order as to costs.