2016 (2) TMI 1101 - HC - Income Tax

Absence of proof of issuance of notice under section 17 of the Wealth-tax Act - virtue of section 42 of the Wealth-tax Act 1957 - Held that - There may be a case to be considered under section 42 of the Act but if we further consider the above referred reasons recorded by the Tribunal it appears that the attention of the Tribunal has not been brought pertaining to section 42 of the Act at the time when the matter was heard before the Tribunal. Resultantly we do not have any discussion whatsoever of the Tribunal in the impugned order for consideration of section 42 of the Act its applicability or the effect. If the appellants were to contend and press in service section 42 prevailing at the relevant point of time it would be for the appellants to move an appropriate application for rectification of the order and it is only after the Tribunal considers the matter and the reasons are recorded a ground may be available before this court in the appellate jurisdiction. We are not inclined to entertain the appeals with the observation that in event if any rectification application is filed by the appellants-Revenue before the Tribunal the rights and contentions of both the sides shall remain upon and the Tribunal shall pass the order after giving opportunity of hearing to both the sides and in accordance with law.

Summary

Issues: Delay in filing appeals, validity of assessment proceedings, applicability of section 42 of the Wealth-tax Act.

Delay in filing appeals:
The judgment addresses a 10-day delay in filing the appeals. The court acknowledges the delay but decides to consider the main subject matter of the appeals due to the short delay. The court mentions that a lenient view could be taken on the delay for condonation.

Validity of assessment proceedings:
The Tribunal's order is discussed, where it confirmed the order of the Commissioner of Wealth-tax (Appeals) without interference. The Tribunal observed that the Revenue's appeal raised a common ground related to the issuance of notice under section 17 of the Wealth-tax Act. The Tribunal found that the Commissioner's order did not require any interference. The judgment highlights the argument made by the appellants' counsel regarding the preclusion from raising contentions about notice service under section 42 of the Act. The court notes that the Tribunal did not consider section 42 during the hearing, and there was no discussion or consideration of its applicability or effect in the Tribunal's order.

Applicability of section 42 of the Wealth-tax Act:
Section 42 of the Wealth-tax Act is discussed in detail, emphasizing that if the appellants wish to rely on this section, they must file an application for rectification before the Tribunal. The judgment states that the Tribunal needs to consider the matter and record reasons before any ground related to section 42 can be available in the appellate jurisdiction. The court decides not to entertain the appeals but allows the appellants to file a rectification application before the Tribunal. The judgment also addresses another appeal involving the same subject matter, stating that the same position regarding rectification and appeal applies to that case as well.

In conclusion, the judgment provides a detailed analysis of the issues related to the delay in filing appeals, the validity of assessment proceedings, and the applicability of section 42 of the Wealth-tax Act, emphasizing the need for proper procedures to be followed for addressing legal contentions effectively.