2001 (2) TMI 298 - AT - Income Tax

Summary

Issues Involved:
1. Stay of demand of tax.
2. Condone the delay in filing the appeal.
3. Validity of appeal without payment of tax.
4. Consideration of the previous Tribunal order.
5. Miscellaneous petition for rectification of the Tribunal's order.
6. Applicability of section 249(4) of the Income-tax Act.
7. Jurisdiction and powers of the Tribunal.

Detailed Analysis:

1. Stay of Demand of Tax:
The assessee, an individual, requested a stay of tax demand amounting to Rs. 56,698,100, which arose from an assessment under Chapter XIV-B of the Income-tax Act, 1961. The request was based on an order by the Tax Recovery Officer to foreclose Fixed Deposits for dues recovery and a rejection of stay by the Assessing Officer dated 15th January 1998.

2. Condone the Delay in Filing the Appeal:
The appeal was filed on 9-9-1998, delayed by 283 days. The counsel for the appellant argued that the delay was due to the appellant's confinement for eight months and seizure of assets. The appellant filed the return of undisclosed income on an estimate basis and paid the admitted tax on the same day the appeal was filed. The appellant sought condonation of the delay, citing cooperation with the Revenue Department and trauma faced.

3. Validity of Appeal Without Payment of Tax:
The counsel cited the Supreme Court ruling in CIT v. Filmistan Ltd., which held that an appeal filed without payment of tax is not valid. The appeal becomes enforceable only upon payment of tax, and the appellate authority can then consider condoning the delay. The appellant's previous appeal was rejected for non-payment of tax, and the current appeal should be admitted following the payment of tax.

4. Consideration of the Previous Tribunal Order:
The appellant argued that the previous Tribunal order dated 7-8-1998 dismissed the appeal due to non-payment of tax. The appellant contended that the Tribunal should consider the miscellaneous petition highlighting mistakes in the previous order and proceed with the current stay application.

5. Miscellaneous Petition for Rectification of the Tribunal's Order:
The appellant filed a miscellaneous petition arguing that the previous Tribunal order did not consider a decision by the Ahmedabad Bench, which held that section 249(4) does not apply to appeals before the Tribunal. The appellant also argued that the return filed was not legally valid, and therefore, the requirement to pay tax on the returned income did not arise. The Tribunal allowed the appellant to present arguments on the miscellaneous petition but cautioned that it could only correct apparent mistakes, not review the order.

6. Applicability of Section 249(4) of the Income-tax Act:
The Tribunal had previously conceded to the Department's argument that section 249(4) applies to appeals before the Tribunal, requiring payment of tax on the returned income for the appeal to be admitted. The appellant argued that this provision applies only to appeals before the Deputy Commissioner or Commissioner (Appeals), not the Tribunal.

7. Jurisdiction and Powers of the Tribunal:
The Tribunal examined its jurisdiction and powers under sections 253 and 254 of the Act. It concluded that it could only hear appeals falling within defined categories and could not entertain supplementary appeals for the same assessment year. The Tribunal also emphasized that it could not review its own orders and that any correction of mistakes must be apparent from the record.

Conclusion:
The Tribunal dismissed the stay application, the appeal, and the miscellaneous petition. It held that the appeal was not maintainable due to non-payment of tax on the returned income and that the Tribunal could not entertain a second appeal for the same assessment year. The Tribunal's previous order dated 7-8-1998 was deemed final, and the appellant's subsequent payment of tax did not warrant the revival of the appeal.