New Cawnpore Flour Mills vs Commissioner of Income Tax

The Income Tax Appellate Tribunal, Allahabad, has referred the following question of law u/s 256(2) of the Income Tax Act, 1961 hereinafter referred to as "the Act", for the opinion to this court :

"(i) Is the order of the Appellate Tribunal restoring the case for fresh disposal back to the Commissioner of Income Tax (Appeals) legally valid ?"

The reference relates to the assessment year 1979-80.

It appears that the Income Tax Officer while making the assessment had taken various points in the assessment orders which were under challenge before the Commissioner of Income Tax (Appeals), who in his turn without giving any finding for proper adjudication simply stated that in view of the foregoing, that is, the various submissions and other correspondence as reproduced in the appellate order, the additions cannot be sustained. The order of the Commissioner of Income Tax (Appeals) was short and cryptic and he did not consider the different aspects of the matter. The Revenue had preferred an appeal before the Tribunal and the Tribunal after considering the various pleas has restored the matter to the file of the Commissioner of Income Tax (Appeals) to decide the matter afresh after giving opportunity to both the sides of being heard.

We do not find any infirmity in the approach adopted by the Tribunal in the present case. Even otherwise, in the case of Commissioner of Income Tax Vs. Naresh Chandra Bhargava, , this court has held that where the Tribunal does not decide any point against or in favour of either of the two parties and remands the case to the first appellate authority for fresh hearing and disposal, no reference lies in such circumstances.

In this view of the matter, we answer the question referred to us in the affirmative, i.e., in favour of the Revenue and against the assessee. However, there shall be no order as to costs.