9911796707
TMI Blog2002 (4) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... respondents. This petition seeks to challenge the order of the Income-tax Appellate Tribunal dated September 30, 1986, passed under section 256 of the Income-tax Act, 1961 ("the Act" for short), in so far as it referred four questions for the consideration of this court in para. 9 of that order in addition to two questions which were initially proposed to be referred when the draft statement of case was prepared. The question sought to be raised in this petition is as to whether such a modification in the draft statement amounts to a review and whether the same is permissible in law. The facts leading to this petition are as follows : The petitioner is a company having a licence to carry on banking business in India under section 22 of the Banking Regulation Act, 1949. The Inspecting Assistant Commissioner of Income-tax by his order dated March 21, 1980, disallowed certain claims of the petitioners for the assessment year 1977-78. On the petitioners filing an appeal, the contentions of the petitioners were partly accepted and the Income-tax Appellate Tribunal by its order dated October 13, 1983, held as follows : (a) that the method of accounting adopted by the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 83 being interest received on the broken period of the securities sold by the assessee should not be considered as part of the chargeable income for the year of account ? (5) Whether, on the facts and in the circumstances of the case, the assessee is not liable to be taxed in respect of the amount credited to the interest suspense account representing interest on sticky loans and advances and which is not taken to the profit and loss account for the relevant accounting year ? (6) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the restriction of deduction, of expenses at 5 per cent. laid down in section 44C of the Act was not applicable in respect of expenditure incurred up to June 1, 1976 ? (7) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the provisions of section 40A(5) of the Income-tax Act, 1961, are not applicable to the proportionate expenses deductible under section 20 of the Income-tax Act for computing income chargeable to tax under the head 'Interest on securities' even though such interest on securities and treasury bills was part of the business p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o challenge this addition of four questions vide the above order of reference dated September 30, 1986. Amongst others, we find that the challenge in the present petition is principally contained in paragraphs 8 and 10. In paragraph 8, it is submitted that the petitioners had objected to the addition of these questions before the Tribunal by pointing out that the hearing subsequent to the notice was only to settle the draft of the case ; that reference of the remaining questions had already been rejected by the Tribunal ; and that the Tribunal had no power to review its own decision refusing to refer the remaining questions. As far as this alleged objection by the petitioners is concerned, we do not find any reference thereto in the statement of the case dated September 30, 1986, nor is it stated in the petition as to in what manner this objection was raised before the Tribunal that such addition cannot be done and that the petitioners were objecting to any such addition. It is not stated that any affidavit was filed raising such objection nor is it contended that counsel appearing for the petitioners had orally raised this objection. This becomes relevant when one finds that learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee and he is not entitled to go behind the facts found by the Tribunal in the statement of case. One cannot have any grievance with this proposition, but this proposition does not assist the petitioners in the present controversy in any manner. The second authority relied upon by Mr. Mistry was also from the apex court in the case of CIT v. Calcutta Agency Ltd . (1951] 19 ITR 191. Mr. Mistry drew our attention particularly to the observations appearing at the top of page 197 of this report. The relevant statements on this page read as follows : "The statement of the case under the rules framed under the Income-tax Act is prepared with the knowledge of the parties concerned and they have a full opportunity to apply for any addition or deletion from that statement of the case. If they approved of that statement that is the agreed statement of facts by the parties on which the High Court has to pronounce its judgment. In the present case, the parties perused the statement of case and as disclosed by the note made at the end of it, had no suggestions to make in respect thereof. It is therefore clear that it was the duty of the High Court to start with that statement of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co. Ltd. v. CIT [1969] 73 ITR 634. This was only for a limited purpose that the judgment of this court in the case of N. V. Khandvala [1946] 14 ITR 635 was approved by the apex court. To the same effect, he relied upon another judgment of the apex court in the case of CIT v. McLeod and Co. Ltd. [1970] 78 ITR 22, wherein also the above re red judgment of this court in the case of N. V. Khandvala [1946] 14 ITR 635 s been referred with approval. The last authority relied upon by Mr. Mistry, was of a Division Bench of this court in the case of Purshottam Laxmidas v. CIT [1956] 30 ITR 143. Mr. Mistry drew our attention to the paragraph appearing on pages 150 and 151 of this report. That was a matter where the Division Bench declined to ask the Tribunal to substitute an entirely new statement of the case as suggested by the assessee. This judgment also does not advance the proposition sought to be canvassed by Mr. Mistry. Mr. Mistry then referred to the Appellate Tribunal Rules, 1963, and particularly rule 44 which deals with preparing of the statement of case if a question of law arises. He also pointed out that under rule 43 if in the opinion of the Tribunal no question of law a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... funded." Mr. Mistry was fair enough to draw our attention to a judgment of a Division Bench of the Gujarat High Court in the case of CWT v. Sayaji Mills Ltd. [1971] 82 ITR 662. The principal question raised in that matter was with respect to the date from which the time will start running for the purposes of filing the application to the High Court to direct the Tribunal to refer certain additional questions of law. In that matter, what had happened was that the assessee concerned took the date on which the draft statement was prepared as the relevant date for that purpose. The Division Bench held that it was not the correct date, but only after the final statement was filed and notice of filing of reference was served on the assessee that the limitation would start running. However, what is material is that in this context, the Division Bench of the Gujarat High Court observed as follows : "We may point out that till the stage when the reference is actually filed in court, the earlier stages which the Tribunal goes through are tentative stages and not final and at no intermediary stage can it be said that a final decision is taken by the Tribunal. It is possible that in a par ..... X X X X Extracts X X X X X X X X Extracts X X X X
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