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TMI Blog1972 (12) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... nal, Madras Bench, to take up the department appeal in I.T.A. No. 6953/53-54 (R.A. No. 714/54-55) and rehear the appeal under section 66(5) of the Indian Income-tax Act, 1922 (hereinafter called "the Act"), and decide the appeal in conformity with the judgment of this court dated November 24, 1959, rendered in R.C. No. 75/ 57. Respondents Nos. 1 and 2 in this writ petition are the legal representatives of one M. R. M. Perianna Chettiar (deceased), hereinafter called the assessee, and the 3rd respondent is the Income-tax Appellate Tribunal. Though the relief asked for is a mandamus directing the Tribunal to re hear the appeal, in effect it was for a declaration that the Tribunal's order dated August 22, 1960, made under section 66(5) of the Act was not in conformity with the order of this court in R.C. No. 75/57 and that, therefore, the Tribunal should be directed to re-hear the matter. In fact, the Income-tax Officer, Karaikudi, by a letter dated November 22, 1963, drew the attention of the Tribunal that a mistake has occurred in the order of the Tribunal dated August 22, 1960, in giving effect to the order of the High Court and that the original appeal filed by the department befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncluded in this assessment was a sum of Rs. 3,19,162 as a constructive remittance of foreign profits having been received in India on February 5, 1948. The circumstances under which this amount came to be treated as a constructive remittance of foreign profits received during the accounting year relevant to the assessment year 1948-49 may be noted now. When the assessee was in need of money for doing his business in stocks and shares he made the Penang branch of M.R.M.S. Hundial shop in which he was a partner to raise monies from certain individuals in Penang and remit the same to its head office in India from where the assessee took them over. In 1942, the branch of the Hundial shop at Penang was closed and the assets and the liabilities of that branch were taken over by the joint family firm, at Penang. Of the credits M.R.M..S. Hundial firm had at the time when it was taken over was one for Rs. 3,19,162 against the head office at Karaikudi. On February 5, 1948, the joint family firm, wrote off the debit balance which stood against M.R.M.S. Penang, though there was an asset for nearly that amount in the head office of M.R.M.S. shop of Karaikudi, which represented the remittance ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment order and directed the Income-tax Officer "to make a fresh assessment according to law starting from the stage of returns" and concluded by stating "the appeal is dismissed". This order is dated October 14, 1954. Treating the direction of the Tribunal to make a fresh assessment according to law starting from the stage of returns as one under section 34(3) of the Act, the Income-tax Officer, by an order dated August 20, 1955, requested the assessee to inform him as to whether the return already filed by him could be taken as relating to the family and if that were not so, requiring him to file a return of income of the family to enable him to carry out the directions contained in the Tribunal's order. On September 23, 1955, the Income-tax Officer also issued a notice under section 34 to the assessee. Aggrieved by this notice instituting proceedings under section 34 the assessee filed W.P. No. 950/55 in this court raising various objections. This writ petition was dismissed on March 21, 1957, with the observation that the assessment was only a protective assessment and no question of collection would arise. The assessee having failed to get a reference under section 66(1), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no meaning should be attached to the concluding words "the appeal is dismissed". With reference to these rival contentions, this court observed: "On the terms of the order, as they stand, it would be open to either of the constructions contended for", but did not express any opinion accepting or rejecting any of the rival contentions. In the result, this court answered the questions in the following terms: "Question No. 1 cannot, therefore, arise. As regards the second question, we are of opinion that, as the question as to who received the foreign profits during the year of account was not properly the subject of appeal, the Tribunal was not competent to decide that question by giving a finding that the joint family received the foreign remittance and remand the proceedings for fresh assessment." After this order the Tribunal made the following order under section 66(5) : "In compliance with the decision of the High Court of judicature at Madras, in Case Referred No. 75 of 1957, dated 24th November, 1959 (3rd Agrayana, 1881), we hereby set aside our order in the above case, thereby restoring the Appellate Assistant Commissioner's order. The Income-tax Officer shall modify t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en to either of the constructions contended for" on the rival contentions placed before it. It seems to us that the High Court could not have accepted the interpretation of the department that the order of remand should be considered as the real order of the Tribunal and that no meaning should be attached to the concluding words dismissing the appeal as the department have not questioned that portion of the order in any reference or otherwise directly. It would not have been open to them to advance that contention on a reference at the instance of the assessee, rightly or wrongly, we say so because we are not called upon to decide the same, the Tribunal thought that they can dismiss the appeal on the ground that the remittances could not at all be included in the assessment of the individual and at the same time give direction to the Income-tax Officer to include the same in the assessment of the joint family and make a fresh assessment starting from the stage of returns. The assessee questioned the direction given by the Tribunal in the reference to the High Court, but the department did not choose to question the dismissal of the appeal by asking for any reference under section 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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