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TMI Blog2003 (8) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... pplication under section 256(1) of the Income-tax Act, 1961 (for short, "the Act, 1961"), had proposed the following three questions, which are stated to be of law, for referring the same to this court for its opinion: "1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the statement made by Shri Gopaldas on October 14, 1987, was in the course of search in the case of the assessee-firm? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee was entitled to immunity under Explanation 5 to section 271(1)(c) and consequently cancelling penalty of Rs. 1,68,000? 3. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the difference in stock was only on account of valuation notwithstanding the fact that there was difference in quantity of stock found as specified in para. 3 of the order under section 271(1)(c)?" From the statement of the case we find that the Income-tax Appellate Tribunal, Jaipur Bench, Jaipur (for short, "the Tribunal") referred questions Nos. 1 and 2 only to this court for its opinion, the reference may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al locker was opened. Accordingly penalty of Rs. 1,68,000 was levied. This order of the Assessing Officer has been confirmed in the appeal by the Commissioner of Income-tax (Appeals). The matter was taken by the assessee to the Tribunal. The learned Tribunal first analysed the provisions of Explanation 5 to section 271(1)(c) of the Act, 1961, and particularly clause (2) thereof which was added with some intent and purpose. Then it analysed the provisions contained in Part C of Chapter XIII of the Act which gives various powers to different authorities to carry out the purposes of the Act. While dealing with Part C of Chapter XIII, the learned Tribunal discussed at length the provisions of section 132 of the Act, 1961, and observed that this provision has to be construed harmoniously in order to give effect to the intention of Parliament. It is observed that the word "in the course of the search" appearing in clause (2) of Explanation 5 cannot be interpreted too technically and too narrowly, particularly when the search by itself is an incidental power. According to the Tribunal it would be sufficient if the disclosure is made before the process under section 132(5) commences, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 and 2 referred to this court for opinion are only of academic nature and this court may send the same unanswered. It is high time that the courts are to be very cautious, careful and considered that its valuable and precious time is not wasted or consumed in deciding matters of academic nature. The decision given on these two questions either way will not have any bearing or effect on the ultimate result to which the court subordinate or the Tribunal reached, meaning thereby even if the case of the Revenue is accepted, still it will not result in grant of relief in its favour. Even if these two questions of law are answered in favour of the Revenue we are satisfied that it will not result in revival of the order of the Assessing Officer which has been confirmed by the Commissioner of Income-tax (Appeals), i.e., the penalty of Rs. 1,68,000 and the consequential liability of payment thereof upon the assessee. The Union of India and the State are the biggest litigants, in the courts. Both the Union of India and the State are impersonal machinery. The officers responsible for the affairs of the administration should be very careful, cautious and concerned to see that unwarranted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence pursuant to an order calling upon the Tribunal to state a case, the High Court is not bound to answer the question without considering whether it arises out of the order of the Tribunal, whether it is a question of law, or whether it is an academic, unnecessary or irrelevant. Power to reframe a question may be exercised by the court to clarify some obscurity in the question referred, or to pinpoint the real issue between the taxpayer and the Department or for similar other reasons; it cannot be exercised for reopening an enquiry on questions of fact and law which is closed by the order of the Tribunal. In this case in hand it is to be stated at the cost of repetition that on the second point the Tribunal has set aside the penalty imposed upon the assessee under section 271(1)(c) of the Act, 1961, which is closed by the order of the Tribunal as question No. 3 has not been referred nor the Revenue has taken any step to file an application under section 256(2) of the Act for a direction to the Tribunal to state the case and refer that question. Sub-section (1) of section 260 of the Act, 1961, no doubt, provides that the High Court or the Supreme Court upon hearing any such ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ] 144 ITR 775 and submitted that once the questions of law are referred for the opinion of this court the same are to be considered and the court has to give its opinion. We have carefully gone through the judgment of the Madras High Court and we are of the opinion that it is not of any help to the Revenue. In that case the court has observed that in this case the question actually referred for our opinion was as to whether the Tribunal was right in holding that in respect of the transactions relating to import licences the income assessable in the hands of the assessee for the assessment years 1968-69 and 1969-70 was only Rs. 1,51,487 and Rs. 1,25,000 as returned by the assessee. The said question had to be answered in the affirmative if the factual finding given by the Tribunal that there was no sale of import licences, but there was only a sale of imported goods was accepted. Learned counsel, who was appearing for the assessee in that case, vehemently contended before the court that it is not possible for this court to go behind the finding of the Tribunal that there was no sale of import licences by the assessees but there was a sale of imported goods, unless there is a specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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