9911796707
TMI Blog1992 (6) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... al Forest and General Mills Pvt. Ltd., Bombay. The search was concluded on January 31, 1990, and a further quantity of 321-321 metric tons of CRCA imported sheets/coils were found in the said premises. The total quantity of the goods was 890.321 metric tons during the course of search under section 132(1) and the stock of CRCA sheets/coils of about 569 metric tons and 321.321 metric tons was seized on January 14, 1990, and January 31, 1990, respectively. Thereafter, the Assistant Commissioner (Investigation) Circle 3(1), Bombay, passed an order under section 132(5) of the Income-tax Act, dated May 7, 1990, retaining 643.221 metric tonnes of seized goods out of the total seizure of 890.321 metric tonnes of goods. In the said order under section 132(5) CRCA sheets weighing 643.221 metric tonnes were held to belong to the assessee within the meaning of section 132(4A) of the said Act and the value thereof worked out at Rs. 1,28,66,420 was held to be income of the assessee for the accounting year 1990-91. The Assistant Commissioner (Investigation), Bombay, also estimated the other business income of the assessee and since the value of unexplained seized CRCA sheets worked out at Rs. 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods. Out of the four persons, three have paid the taxes as well. The Commissioner of Income-tax, Bombay City 111, Bombay, after considering the facts and circumstances by the said order dated June 9, 1990, held : "The fact, however, remains that the fourth person, Shri Mahendrakumar Choudhury, also made a statement accepting a part of the goods belonging to him. I also find that, in the case of Shri P. K. Saraf and Messrs. Subkaran and Sons, orders under section 132(5) were passed and, on the basis of that order, the Commissioner of Income-tax, West Bengal-9, passed an order on March 20, 1990. In the case of Messrs. Subkaran and Sons, the release order was passed by the Assistant Commissioner (Investigation). In view of the statements of the persons concerned, I do not see any reason not to accept the assessee's case that the goods in question belong to different parties and not to it. I am, therefore, of the opinion that the goods that have been owned up as belonging to different parties and on which the taxes have been paid should be accepted to be belonging to those persons. However, if the assessee or any other person produces evidence before the Assessing Officer to prove t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gation), Circle 16(1), Calcutta, wherein it was stated that the jurisdiction of the case of the respondent was transferred to the Assistant Commissioner, Central Circle 30, Bombay, under the Commissioner of Income-tax, Central 11, Bombay, with effect from August 1, 1990, by the order of the Chief Commissioner of Income-tax, Central 11, Bombay, in exercise of his power under section 127 of the Income-tax Act. It was stated on affidavit F that the legal consequence of the transfer order was that the application under section 132(11), against the order under section 132(5) dated May 7, 1990, in the case of respondent No. 2, namely, the assessee, was required to be disposed of by the Commissioner of Income-tax, Central 11, Bombay, who had been vested jurisdiction over the case and, in support of his G contention, Mr. Mitra relied on the provisions of section 130(2) of the Income-tax Act to show that the Commissioner of Income-tax, Bombay City 111, had no jurisdiction. But the provision of section 130(2) of the Income-tax Act was deleted by Parliament, whereas the order was passed by the Commissioner of Income-tax, Bombay City 111, on June 9, 1990, H after the provision of section 130(2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... seized and retained the goods, pursuant to an order passed under section 132(5) of the said Act. Mr. Bajoria submitted that there is no provision in the Income-tax Act that, as soon as the file of the assessee is transferred, the Commissioner of Income-tax who is authorised under the law to exercise the appellate jurisdiction and/or any supervisory jurisdiction will cease to exercise any power before whom a proceeding is pending and it was submitted by Mr. Bajoria that the right of appeal is decided on the basis of the state of the Act when the original order is passed and submitted that the principle is now well-settled that subsequent change does not and cannot take away or abridge or restrict the right of appeal because of the subsequent change, and it was pointed out that it was never the intention of the Legislature that, as soon as the income-tax file is transferred under section 127 of the Income-tax Act, the Commissioner became defunct and had no jurisdiction to pass such an order and it was further submitted that the Assistant Commissioner of Income-tax cannot challenge the jurisdiction and/or authority and competency of the Commissioner of Income-tax. Mr. Bajoria submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that part of the goods does not belong to Naranarayan Saraf and the claim of Naranarayan Saraf was rejected. But the said claim of Naranarayan Saraf was upheld by the Commissioner of Income-tax, Bombay City 111, and so long as the order under section 132(12) of the said Act passed by the Chief Commissioner of Income-tax remains valid and is not set aside, in any other proceedings the same is binding upon the authorities subordinate to the Chief Commissioner of Income-tax, Bombay City III. In this connection, reference may be made to the decision of the Supreme Court in the case of Bhopal Sugar Industries Ltd. v. ITO [1960] 40 ITR 618, wherein it was held that a mandamus would lie in case of refusal by the Income-tax Officer to carry out the direction given by the Tribunal by its final order, if the Income-tax Officer refused to carry out the order passed by the Tribunal. In this connection, it was held that the High Court would be clearly in error if it refused to issue a writ on the ground that no manifest injustice has resulted from the order of the Income-tax Officer in view of the error committed by the Tribunal itself in its order. Such a view is destructive of one of the bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e-tax file is transferred by a Commissioner or by any higher authority, the appeal, revision an or any objection pending before the appellate, revisional or higher authority automatically stands transferred and those authorities become functus officio to deal with and dispose of the proceedings pending before them. It is a firmly established principle that the right of appeal is dependent on the law as was existing when the suit or proceeding was filed and subsequent change in the law cannot affect the right of appeal which was there at the time when the suit was filed and the right of appeal is determined on the basis of the law existing at the time when the suit was filed. In our view, the same is applicable to the facts and circumstances of the case, inasmuch as we do not find any reason that as soon as the income-tax file is transferred under section 127, the Commissioner or Chief Commissioner before whom the proceedings under section 132(11) and (12) are pending become functus officio. This cannot be the intention of the Legislature, inasmuch as it has introduced an absurd, unworkable and illogical result which cannot be said to be the intention of the Legislature. The stand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the ground of irregular existence or defective title, insubordination and disorder of the worst kind would be encouraged. For the good order and peace of society, their authority must be upheld until in some regular mode their title is directly investigated and determined." (see AIR 1981 SC 1477) In the latest judgment of the Supreme Court in Central Bank of India v. C. Bernard [1991] 1 SCC 319, the Supreme Court reiterated its earlier view that the de facto doctrine can be invoked in cases where there is an appointment to office which is defective but notwithstanding the defect to the title of the office, the decision made by such a de facto officer clothed with the powers and functions of the office would be as efficacious as that made by a de jure officer. The de facto doctrine saves official acts done by an officer whose appointment is found to be defective. In our view, when an order is passed by a Commissioner of Income-tax who admittedly and undisputedly had jurisdiction to entertain such applications passes an order subsequent to the transfer of file from the Income-tax Officer, the Commissioner does not lose his jurisdiction to dispose of appeals and applications in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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