1972 (11) TMI 14 - HC - Income Tax

Kerala Agricultural Income Tax Act 1950 - jurisdiction of the Tribunal - Whether on the facts and circumstances of the case the Tribunal was right in adjudicating upon a question not raised in the grounds of appeal ?

Summary

Issues:
Assessment under Agricultural Income-tax Act, 1950 for six individuals for the year 1967-68, Appeal before Appellate Assistant Commissioner challenging best judgment assessment, Tribunal's adjudication on a question not raised in the grounds of appeal.

Analysis:
The judgment pertains to a reference by the Kerala Agricultural Income-tax Appellate Tribunal regarding the assessment of six individuals under the Agricultural Income-tax Act, 1950 for the year 1967-68. The Appellate Assistant Commissioner accepted the contention that the yield per acre should not be uniform and varied based on the maturity of the cardamom plants. However, the Tribunal, without a specific ground in the memorandum of appeal, decided to set aside the Appellate Assistant Commissioner's order and fix the yield at 65 kgs. per acre for the entire estate. The assessees objected to this decision, leading to a reference being made under section 60(1) of the Agricultural Income-tax Act, 1950.

The key issue in the judgment revolves around whether the Tribunal had the authority to adjudicate on a question not raised in the grounds of appeal. The Court highlighted the absence of a provision in the Agricultural Income-tax Rules, 1951 or the Kerala Agricultural Income-tax Appellate Tribunal Regulations, 1965 mandating the specification of grounds of appeal. However, it emphasized the general procedural norm that appellate bodies should only consider grounds specified in the appeal memorandum. The Court discussed the importance of seeking leave to raise additional grounds and the discretion involved in granting such leave, as seen in other legal provisions. In this case, the Court found that the Tribunal's decision to address an issue not raised in the grounds of appeal without seeking or granting leave was procedurally unjustifiable and violated the principles of natural justice.

Consequently, the Court answered the question referred to it in the negative, favoring the assessee and ruling against the department. The judgment underscores the importance of adherence to procedural norms, including the specification of grounds of appeal and the requirement for seeking leave to introduce additional grounds during appellate proceedings. A copy of the judgment will be forwarded to the Kerala Agricultural Income-tax Appellate Tribunal, Trivandrum, as per the Court's directive.