2012 (9) TMI 1145 - HC - Income Tax

Summary

Issues involved:
The appeal involves the interpretation of Section 260-A of the Income Tax Act, 1961, and the question of whether an order passed on a rectification application is appealable to the High Court.

Details of the Judgment:

1. Background and Questions Raised:
The Commissioner of Income Tax filed an appeal under Section 260-A against the order of the Income Tax Appellate Tribunal regarding assessment years 1987-88 to 1992-93. The appellant raised questions regarding the direction given by the Third Member of the Tribunal and the justification of answering some questions while not answering others.

2. Assessment and Tribunal Proceedings:
The Assessing Officer reduced the net loss claimed by the assessee, and the CIT (Appeals) recomputed the income on a cash basis. The Tribunal referred questions to the Third Member, who answered some and left others unanswered. The department's rectification application was dismissed, leading to the current appeal.

3. Maintainability of the Appeal:
The respondent-assessee argued that the order dated 7.4.2000, was not a final order of the Tribunal and therefore not appealable. The appellant contended that the order rejecting the rectification application is independent and maintainable under Section 260-A.

4. Decision and Observations:
The High Court held that the order dated 7.4.2000, rejecting the rectification application was not maintainable as it was not a final order of the Tribunal. The appeal was dismissed, with the observation that the department could raise the grounds in the pending appeal against the final order of the Tribunal dated 31.5.2005.

In conclusion, the High Court dismissed the appeal on the grounds of maintainability, emphasizing the distinction between a final order of the Tribunal and an opinion of the Third Member that required consequential action.