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TMI Blog1957 (2) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... me to the conclusion that these amounts were not liable to tax. From this decision the Commissioner appealed to the Tribunal. It is important to note that the only ground of appeal taken by the Commissioner was that the learned Appellate Assistant Commissioner erred in holding that the sum of ₹ 65,203 (and the same applies to the other sum of ₹ 1,27,836) represented profit accruing or arising in Indian States from business transacted in those States and deleting the same from the income of the assessee. The Tribunal in its decision upheld the view of the Appellate Assistant Commissioner; but it set aside the order of the Appellate Assistant Commissioner and directed that he should dispose of the appeal after taking into consideration the question of apportionment. In other words, the view of the Tribunal was that although the income had accrued in the Indian States the question should be considered whether any process for the earning of that income had taken place in British India and in accordance with the ratio of Ahmedbhai Umarbhai's case the income should be apportioned between Indian States and British India. It is this decision of the Tribunal that is being ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the other side has notice of the new ground which the appellant seeks to urge, there does not seem to be any reason why the Court of appeal should not permit the appellant to challenge the decision of the trial Court on a ground other than those taken in the grounds of appeal. The position with regard to the respondent is different : It is not open to him to urge before the Court of appeal and get a relief which would adversely affect the appellant. If the respondent wanted to challenge the decision of the trial Court, it was open to him to file a cross-appeal or cross-objections. But the very fact that he has not done so shows that he is quite content with the decision given by the trial Court. Therefore, under these circumstances, his only right is to support the decision of the trial Court. It is true that he May support the decision of the trial Court, but on any other ground. In appreciating the question that arises before us, one must clearly bear in mind the fundamental difference in the positions of the appellant and the respondent. The appellant is the party who is dissatisfied with the judgment; the respondent is the party who is satisfied with the judgment. Now what we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in that he has pressed upon the Tribunal a point of view with regard to apportionment which is not covered by the grounds of appeal; but he being the appellant, it was open to him to do so if leave was granted by the Court of appeal. It is true that on the record there does not appear any formal leave. It is also true that the appellant has not amended his grounds of appeal. But leave May be implied and the very fact that the Tribunal permitted the Commissioner to urge this ground goes to show that leave was granted to him. With regard to the proviso, it is not suggested by the assessee that he did not have a sufficient opportunity of contesting this ground. Therefore, this rule is satisfied, Indeed, if the case had arisen under the Civil Procedure Code and the question was of interpreting Order, XLI, rule 2, it could not possibly have been urged by the respondent that the Court of appeal could not permit the appellant to argue the appeal on a different ground from the one taken up by him in the grounds of appeal. 7. But what Mr. Kolah says is that, whatever the construction of this rule and whatever the provisions of the Civil Procedure Code, we are bound by the clear decisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal is not obliged to rest its decision on the grounds urged by the appellant. It recognises the principle that the judgment of the lower Court May be supported on any ground even though it is not raised in the memo of appeal. That, however, does not permit the Tribunal to urge any other ground which would work adversely to the appellant : and when we look at the facts of that case, it is clear that what the Tribunal had done was to give a relief to the Commissioner in appeal when the assessee had appealed and the Commissioner had rested content with the decision of the Appellate Assistant Commissioner and the relief granted was obviously to the prejudice of the appellant. 11. There are two unreported judgments on which Mr. Kolah has relied. One is the judgment in Income-tax Reference No. 51 of 1955 decided by us on 4th September, 1956 (Messrs. Puranmal Radhakishan Co. v. Commissioner of Income-tax, Bombay City. In this judgment we relied on the judgment of Mr. Justice Kania; but it is clear in this judgment also that the Tribunal in an appeal by the assessee gave relief to the Department when the Department had accepted the decision of the Appellate Assistant Commissioner an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tter of the appeal and that the subject-matter of the appeal is constituted by the grounds of appeal, unless with leave that subject-matter is expanded or increased by adding a new ground after leave has been given by the Tribunal. 14. Then there is a very recent judgment of this Court in Commissioner of Income-tax v. Breach Candy Swimming Bath Trust which clearly supports the view that we are taking. In that case the assessee put forward before the Appellate Tribunal an entirely new contention which had not been urged before the Income-tax Officer or the Appellate Assistant Commissioner and the Tribunal permitted the assessee to raise that point and the Commissioner came before us on a reference urging that the Tribunal had no power to permit the assessee to raise a ground not covered by the grounds of appeal. We rejected that contention and we pointed out at page 285 that on this question rule 12 of the Appellate Tribunal Rules was quite clear and that the Tribunal has been given the authority to permit a new point to be raised provided that the party who is affected by the raising of the new point has been given sufficient opportunity of being heard on this point and the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to pay tax at a flat rate. The question of rate only arises when you are dealing with individual assessees. Therefore, either these two sums are liable to tax or they are not. If they are liable to tax, they would be taxed at the same rate as the other income of the company. No purpose can be served by including these two items in the total income of the company. 18. The result, therefore, is that we will answer question (1) in the affirmative and question (3) also in the affirmative. We answer Question (4) in the negative. 19. With regard to question (2) which raises the question of apportionment, it is clear that this question does not arise out of the order of the Tribunal. The Tribunal has not decided on the merits of the contention with regard to apportionment and this question would only arise if after the Appellate Assistant Commissioner has decided against the assessee, decision of the Appellate Assistant Commissioner. But at the present stage all that has happened is that the Tribunal has asked the Appellate Assistant Commissioner to determine whether there is any case for apportionment, and if so, how the income should be apportioned. 20. With regard to question ..... X X X X Extracts X X X X X X X X Extracts X X X X
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