Commissioner of Income Tax vs Shree Tea Co. and Others

A.R. Tiwari, J.—On request, the above noted miscellaneous civil cases, entailing common questions of fact and law are heard analogously and are being disposed of by this common order.

Right at the threshold it may be stated that Miscellaneous Civil Case No. 514 of 1992, was listed today. On request the other miscellaneous civil cases, as particularised above, were also ordered to be listed today through a supplementary cause list for analogous hearing as connected matters. These miscellaneous civil cases are registered on the applications of the Commissioner of Income Tax, Bhopal, presented u/s 256(2) of the Income Tax Act, 1961, and contain the undernoted question, categorised as one of law, for a direction to the Tribunal to state the case and refer the question for our opinion :

"Whether, on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in law in holding that the amended provisions of Section 43B were applicable to the assessment year 1984-85 when the said amendment was effective from April 1, 1988 ?"

This question of law is sought to be supplemented and supported by the undernoted three grounds contained in the applications :

(i) That the Tribunal erred in law in giving retrospective effect to the amendments effective from April 1, 1988, in Section 43B of the Income Tax Act by exceeding its jurisdiction in reading more than what Parliament has expressly provided.

(ii) That the taxing statute is passed after great scrutiny and the Tribunal erred in holding that the meaning of the words being dubious it required interpretation and under that tried to grant more retrospectivity to the amended provision than what is prescribed.

(iii) That as the question is not finally decided by the Supreme Court, a question of law did arise worth opinion of the hon''ble court.

Briefly stated, the facts are that the Assessing Officer made addition of certain amounts in terms of Section 43B of the Act. In appeals, the Commissioner of Income Tax (Appeals) deleted the addition. The Department then filed appeals before the Tribunal. The Tribunal held that the claim was allowable in view of the decision rendered by the High Court of Patna in the case of Jamshedpur Motor Accessories Stores Vs. Union of India (UOI) and Others, , and thus affirmed the order of the Commissioner of Income Tax (Appeals). Section 43B was amended by the Finance Act, 1987. The proviso was made effective from April 1, 1988. The decision of the Tribunal had rested on the order passed in I. T. A. No. 1151/Ind. of 1988--Mantri Brothers v. ITO. On applications u/s 256(1), the Tribunal declined to refer and held that no referable question was in existence.

We have heard Shri D.D. Vyas, learned counsel for the applicant/Department and counsel for non-applicant/assessee in some of these cases. Counsel for the non-applicants argued that there is no question of law for direction of reference.

It is contended that a similar question and three grounds, as noted above, were projected in Miscellaneous Civil Case No. 665 of 1992 Commissioner of Income Tax Vs. Dhiraj Kumar and Co., ). This miscellaneous civil case was dismissed by this court on January 3, 1996. In our view, no new point is pressed and these cases should suffer the same fate of dismissal as nothing is urged to take a different view in the matter.

Question/ground wise our conclusion is as recorded below :

(a) Question/Ground No. 1 :

This question/ground stands concluded by the decision in COMMISSIONER OF Income Tax Vs. BHANDARI CAPACITORS PRIVATE LTD., and the decision in Miscellaneous Civil Case No. 665 of 1992-- Commissioner of Income Tax Vs. Dhiraj Kumar and Co., . Hence, it ceases to be a referable question on this short ground as well. We hold that the Tribunal rightly treated the first proviso to Section 43B, as amended, as retrospective in operation and correctly extended the benefit to the assessee. We are also fortified in our view by the decisions in Commissioner of Income Tax Vs. Polar Fan Industries Ltd., and Commissioner of Income Tax Vs. Chandulal Venichand, .

(b) Ground No. 2 :

The Tribunal did not commit any error. Attractibility or otherwise does fall for consideration in certain cases. It is in the area of legislative ambiguities, yet not receding, that courts have to fill gaps, dear doubts and mitigate hardship. In the words of Judge Learned Hand, spoken in Cabell v. Markhan [1945] 148 F 2d 737, we get enough light to locate the correct path :

"It is one of surest indexes of a mature and developed jurisprudence .... to remember that statutes always have some purpose or object to accomplish whose sympathetic and imaginative discovery is the surest guide to their meaning."

"Like should be treated alike". In view of similar orders passed in other cases of like nature, the Tribunal took the possible and plausible view to apply the law and "mitigate the hardships". Hence, this ground which is a branch of ground No. 1 only, is also held to be no ground of law for reference.

(c) Ground No. 3 :

Mere pendency of a similar question before the apex court does not admittedly give rise to the question of law. In Commissioner of Income Tax (Central), Calcutta Vs. Ashoka Marketing Ltd., , and in Commissioner of Income Tax, Andhra Pradesh Vs. Kotrika Venkataswamy and Sons, , it is held that conclusion based on question of fact does not give rise to any question of law. In Commissioner of Wealth-tax Vs. Smt. Usha Devi (Lrs. of H.H. Maharaja Yeshwant Rao Holkar), , it is held that the pendency of same issues before the Supreme Court is no ground for directing the reference. The same view was taken by this court in Miscellaneous Civil Case No. 125 of 1988- Ganga Cut Piece Centre Vs. Commissioner of Income Tax, , decided on December 14, 1995, and in Miscellaneous Civil Case No. 48 of 1985,-- Ganga Cut Piece Centre Vs. Commissioner of Income Tax, , decided on December 19, 1995. It is thus clear that even this ground does not give rise to any referable question of law.

In Parashuram Pottery Works Co. Ltd. Vs. Income Tax Officer, Circle I, Ward A, Rajkot, , pertaining to the Income Tax Act, it is held that (headnote of AIR 1977 SC) :

" At the same time, it must be borne in mind that the policy of law is that there must be a point of finality in all legal proceedings, that stale issues should not be reactivated beyond a stage and that lapse of time must induce repose in and set at rest judicial and quasi-judicial controversies as it must in other spheres of human activity. " ''

On bestowal of our anxious consideration, we thus hold that there is no referable question of law as contained in the applications and noted above. The grounds in support of this question are equally inutile and futile and do not improve the fate of these applications.

Consequently, we dismiss all these miscellaneous civil cases as devoid of merit but with no orders as to costs.

Counsel fee is, however, fixed at Rs. 750 for each side in each case, if certified.

Retain this order in Miscellaneous Civil Case No. 514 of 1992 and place its copy each in the connected miscellaneous civil cases for ready reference.