2003 (7) TMI 60 - HC - Income Tax

Appeal High Court - This application is filed for recalling the order made by the Division Bench at the stage of admission formulating the question of law. Learned counsel for the applicant submitted that there is usual practice in this court that before framing the questions of law, the respondents are to be heard, irrespective of the fact that appeal is filed by the assessee or by the Revenue. - it cannot be said that if the appeal is admitted or question of law framed without hearing the respondent, it is violative of any provisions of law or is impermissible. In view of this there is no reason to recall that order The application stands rejected.Thus, the respondent is not required to be heard before the admission of the appeal.

Summary

Issues:
Admission of Income-tax Appeal without hearing respondents for framing substantial question of law under Section 260A of the Income-tax Act, 1961.

Analysis:
The judgment delivered by B. C. PATEL C. J. addresses the issue of the usual practice in the High Court regarding the admission of appeals without hearing respondents for framing substantial questions of law under Section 260A of the Income-tax Act, 1961. The applicant sought to recall an order made by a Division Bench at the stage of admission, arguing that respondents should be heard before framing questions of law, irrespective of whether the appeal is filed by the assessee or the Revenue.

The court examined sub-sections (3) and (4) of Section 260A of the Income-tax Act, 1961, which govern the formulation and hearing of substantial questions of law in appeals. Sub-section (3) mandates that the High Court must be satisfied that a substantial question of law is involved in a case before formulating it. Sub-section (4) specifies that the appeal shall be heard only on the formulated question, allowing respondents to argue that the case does not involve such a question during the appeal hearing.

The court rejected the applicant's submission that respondents must be heard before framing questions of law, emphasizing that the admission process aims to determine if there is substance in the appeal. It clarified that the respondent's right to be heard is limited, primarily concerning ad interim relief rather than the admission of the appeal. The provisions of the Code of Civil Procedure, 1908, relating to the High Court are applicable to appeals under Section 260A.

Furthermore, the court highlighted that there is no mandatory requirement to issue notice before admission or formulating questions of law. The respondent's right to argue against the formulated question during the appeal hearing indicates sufficient safeguards for the respondent. While it may be a practice to hear respondents before admission, the court concluded that admitting an appeal or formulating a question without hearing the respondent does not violate any provisions of law. Therefore, the court rejected the application to recall the order, affirming that the appeal stands admitted without the need to hear the respondents beforehand.