2009 (6) TMI 332 - HC - Income Tax

Appeal to tribunal - Whether the Income-tax Appellate Tribunal was justified in confirming the findings recorded by Commissioner of Income-tax (Appeals) without resorting to recording its own findings on each and every issue raised, projected and argued before the said Tribunal? - Tribunal should have dealt with issues both on facts and law with reference to submissions urged and then returned their own reasoning, which may be of concurrence or that of reversal. Quoting the finding of the Commissioner of Income-tax (Appeals) and simply upholding the same without giving its own reasoning, is not proper. - In our view, it does not amount to deciding the appeal but at best it may amounts to its disposal . - Tribunal will decide the appeal after narrating the full relevant facts necessary for the disposal of appeal, legal issues governing the questions and then assign their reasoning with reference to any case law on the subject having its application to the questions raised Matter remanded

Summary

Issues involved: Appeal under section 260A of the Income-tax Act, 1961 against an order dated April 11, 2001, passed by the Income-tax Appellate Tribunal, Indore Bench in I. T. A. No.78/Ind/2000. Additional substantial question of law regarding remand of the case to the Tribunal for deciding the appeal afresh on the merits.

Analysis:
1. The appeal was filed by the assessee under section 260A of the Income-tax Act, 1961 against an order dated April 11, 2001, passed by the Income-tax Appellate Tribunal, Indore Bench in I. T. A. No.78/Ind/2000. The substantial question of law raised was whether the Tribunal was justified in confirming the findings recorded by the Commissioner of Income-tax (Appeals) without recording its own findings on each issue raised. The court framed an additional substantial question of law regarding the remand of the case to the Tribunal for deciding the appeal afresh on the merits.

2. The Tribunal's decision in the assessment year 1996-97 was challenged based on the lack of detailed reasoning in the judgment. The Tribunal's order merely confirmed the findings of the Commissioner of Income-tax (Appeals) without providing any substantial discussion or reasoning. The court emphasized the importance of providing reasons for decisions, citing the Supreme Court's observations on the necessity of assigning reasons by quasi-judicial and administrative authorities to support their conclusions.

3. The court found the Tribunal's approach of merely quoting the findings of the Commissioner of Income-tax (Appeals) and upholding them without providing its own reasoning unacceptable. The court highlighted that such an approach does not constitute "deciding the appeal" but rather amounts to "disposal." As the final court of appeal on facts, the Tribunal should have addressed issues on both facts and law, referencing submissions made, and provided its own reasoning, whether concurring or reversing the decision.

4. Consequently, the court allowed the appeal, setting aside the Tribunal's order and directing the Tribunal to decide the appeal afresh on the merits. The Tribunal was instructed to narrate all relevant facts, address legal issues, and provide reasoning with reference to applicable case law within six months. The parties were scheduled to appear before the Tribunal for the decision. No costs were awarded in the judgment.