1989 (8) TMI 61 - HC - Wealth-tax

Summary

Issues:
1. Appealability of orders passed under section 35(8) of the Wealth-tax Act.
2. Rectification of orders by the Appellate Assistant Commissioner under section 35(8) of the Wealth-tax Act.

Analysis:

Issue 1: Appealability of orders passed under section 35(8) of the Wealth-tax Act:
The case involved the question of whether an appeal lies to the Tribunal from the order of the Appellate Assistant Commissioner under section 35 of the Wealth-tax Act. The Appellate Assistant Commissioner rectified the assessment under section 35(8) of the Act, directing exclusion of additional compensation awarded by the court. The Tribunal, relying on precedent, held that there was no mistake in the original order and cancelled the rectification order. The Tribunal's decision was based on the Supreme Court's ruling that rectification proceedings are part of the assessment process. The High Court agreed with the Tribunal, emphasizing that the rectification of an error is not an independent exercise but a part of the appellate jurisdiction. Therefore, the High Court held that an appeal lies to the Tribunal against the order passed by the Appellate Assistant Commissioner rectifying the assessment.

Issue 2: Rectification of orders by the Appellate Assistant Commissioner under section 35(8) of the Wealth-tax Act:
The Appellate Assistant Commissioner, in the original order, deleted only the inclusion of interest but retained the additional compensation in the assessments. The assessee sought rectification to exclude the additional compensation as well. The High Court examined the nature of the additional compensation, emphasizing that it accrued to the assessee when the land was acquired, and thus, rightly included in the returns. The Court referred to the process of quantification of compensation and held that the right to compensation relates back to the date of acquisition. As the inclusion of interest was the only ground pressed in appeals, the original order deleting interest alone was found to be correct. Therefore, the High Court concluded that there was no mistake apparent on the records and answered both questions in favor of the Revenue and against the assessee.

In conclusion, the High Court upheld the Tribunal's decision, affirming the appealability of orders passed under section 35(8) of the Wealth-tax Act and confirming the correctness of the original order by the Appellate Assistant Commissioner regarding the inclusion of interest and additional compensation in the assessments.