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TMI Blog2007 (2) TMI 607X X X X Extracts X X X X X X X X Extracts X X X X ..... he Enforcement wing officials (D3 proposals) the respondent revised the order of assessment for the assessment years 1993-94 and 1994-95 on November 17, 1998. Against the said orders of revised assessment, the petitioner preferred appeals before the Appellate Assistant Commissioner (CT IV) in Appeals Nos. 312 and 311 of 1999. The appellate authority, after verification of the books of account and other relevant and necessary documents in support of the bill discounting facilities pleaded by the petitioner, passed a detailed common order on July 17, 2001 partly remanding and partly dismissing the appeal. In respect of that portion of remand order, the Appellate Assistant Commissioner directed the assessing officer to reconsider the issue by giving certain directions therein. The assessing officer passed the revised order without following the directions given in the appellate order. Hence, the present original petition, which is now converted as a writ petition on being transferred to the file of this court on abolition of the Tamil Nadu Taxation Special Tribunal. Heard the learned counsel on either side and perused the materials available on record. The above order of revised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompanies of some repute. Therefore, the alleged sales transactions involved in bill discounting and reflected in the invoices recovered at the time of inspection should be cross verified with the above buyers. (c) If the transactions reflect in the accounts of the above buyers, such transactions should be assessed, if not already assessed. (d) If the transactions do not reflect in the books of account of the buyers, the assessment on such transactions should be deleted. By the impugned order, which is made pursuant to the order of remand by the appellate authority, the assessing officer reconfirmed his earlier order, the material portion is extracted below: As directed by the Appellate Assistant Commissioner, all the connected records which were produced before the Appellate Assistant Commissioner were called for from the dealers. Regarding the details for suppression arrived at as per the slips recovered at the time of inspection of their business premises against form D7 acknowledgement, they have stated that the particulars could not be given due to efflux of time. But they have furnished the details for Rs. 5,98,207 which they have claimed that only bills were ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n who feels aggrieved can get adequate redress against the wrongful act complained of. Section 31 provides for appeal to Appellate Assistant Commissioner against an order passed under certain provisions of the Act, which included in it assessment order also. Section 32 provides for special powers, i.e., suo motu power to the Deputy Commissioner for examining the correctness of the order passed under certain provisions of the Act. Section 33 provides for revision to the Joint Commissioner against orders, which are not appealable. Section 34 invested on the Joint Commissioner special suo motu power for examination of the correctness of the order made under certain provisions. Section 35 provides revision to Joint Commissioner and section 36 provides for second appeal to the Appellate Tribunal against the order of the Appellate Assistant Commissioner/Deputy Commissioner. Thus, the Act provides for complete machinery to challenge the order of assessment before the authorities prescribed under the Act. Under the hierarchical statutory system, as contemplated under the Act, the order of the assessing officer is appealable under section 31 of the Act. Thus, the Appellate Assistant Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... J. as a member of the Full Bench (of five Judges) in Chappan v. Moidin Kutti [1899] 22 ILR Mad 68 (at page 80) stated, inter alia, that appeal is 'the removal of a cause or a suit from an inferior to a superior judge or court for re-examination or review'. According to Wharton's Law Lexicon such removal of a cause or suit is for the purpose of testing the soundness of the decision of the inferior court. In consonance with this particular meaning of appeal, 'appellate jurisdiction' means 'the power of a superior court to review the decision of an inferior court.' 'Here the two things which are required to constitute appellate jurisdiction, are the existence of the relation of superior and inferior court and the power on the part of the former to review decisions of the latter. This has been well put by Story: 'The essential criterion of appellate jurisdiction is, that it revises and corrects the proceedings in a cause already instituted and does not create that cause. In reference to judicial Tribunals an appellate jurisdiction, therefore, necessarily implies that the subject-matter has been already instituted and acted upon by some other court, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the correctness or otherwise of their conclusion or of any factual mala fides but with the fact that the officers, in reaching their conclusion, by-passed two appellate orders in regard to the same issue which were placed before them, one of the Collector (Appeals) and the other of the Tribunal. The High Court has, in our view, rightly criticised this conduct of the Assistant Collectors and the harassment to the assessee caused by the failure of these officers to give effect to the orders of authorities higher to them in the appellate hierarchy. . . The impression or anxiety of the Assistant Collector that, if he accepted the assessee's contention, the department would lose revenue and would also have no remedy to have the matter rectified is also incorrect. Section 35E confers adequate powers on the department in this regard. . . In the light of these amended provisions, there can be no justification for any Assistant Collector or Collector refusing to follow the order of the Appellate Collector or the Appellate Tribunal as the case may be, even where he may have some reservations, on its correctness. He has to follow the order of the higher appellate authority. This may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e order of the Tribunal. So long as that order of the Tribunal is not set aside, the Appellate Assistant Commissioner is bound to give effect to it, and if he fails to do it and by-passes it on the ground that the department has filed an appeal, it will be really a contempt of the Tribunal's order . . . In Shankar Ramchandra Abhyankar v. Krishnaji Dattatraya Bapat reported in AIR 1970 SC 1, the Supreme Court pointed out that the appeal is the right of entering the superior court and invoking its aid and interposition to redress the error of the court below. There are two important postulates of constituting the appellate jurisdiction: (i) the existence of the relation of superior and inferior court; and (ii) the power in the former to review decisions of the latter. Such jurisdiction is capable of being exercised in a variety of forms. An appeal is a process of civil law origin and removes a cause, entirely subjecting the facts as well as the law, to a review and a retrial. Section 31(3) of the Act empowers the Appellate Assistant Commissioner in case of an assessment order, to confirm, reduce, enhance or annul the assessment or the penalty or both or set aside the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iven in paragraph Nos. (c) and (d) has not at all been complied with. The action of the assessing officer in passing the impugned assessment order, which has been passed without any regard to the direction given by the Appellate Assistant Commissioner, having regard to the statutory hierarchical scheme and the binding nature of the order passed by the appellate authority as envisaged in the various decisions above referred to, cannot be legally sustainable and it has to be set aside with a specific direction to the assessing officer to follow the directions given by the Appellate Assistant Commissioner in his proceedings dated July 17, 2001. In the given set of facts, I can also take support of the ratio laid down in the case of Union of India v. Kamlakshi Finance Corporation reported in [1991] 55 ELT 433 (SC) to state that it is not as if the Revenue is left without any remedy. Even assuming for a moment the order of the appellate authority is not in accordance with law, the Revenue can very well take the order on appeal and there are provisions as stated in the earlier paragraphs in which the superior officers are vested with the suo motu powers to call for, rectify the defect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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