9911796707
TMI Blog1981 (12) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... wo years be not reduced and the mistake rectified. The assessee gave his reply contending that the deductions given were justified on the basis of the decision of the Appellate Tribunal. The Expenditure-tax Officer, however passed a composite order of rectification under s. 31 of the Act. The effect of the order was to increase the amount of taxable expenditure determined resulting in enhancement of the amount of expenditure-tax determined as payable by the assessee for both years. The assessee preferred appeals to the AAC under s. 21 of the Act against the rectification which had the effect of enhancing the amount of expenditure-tax determined as payable by the assessee. These appeals were dismissed by the AAC on the ground that no appeal lay under s. 21 of the Act against an order of rectification made under s. 31 thereof (annexs. C and C-1). The assessee then preferred appeals to the Appellate Tribunal under s. 22 of the Act. These appeals have been dismissed by the Tribunal's composite order (annex. E) dated January 13, 1978, upholding the view taken by the AAC that no appeal under s. 21 of the Act lies against an order of rectification made under s. 31 of the Act. The Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty days of the receipt of the notice of demand relating to the assessment or penalty objected to, or the date on which any order objected to is communicated to him, but the Appellate Assistant Commissioner may admit an appeal after the expiration of the period aforesaid if he is satisfied that the appellant had sufficient cause for not presenting the appeal within that period." The relevant part of s. 30(1) of the Indian I.T. Act, 1922, is as under: " 30. Appeal against assessment under this Act.-(1) Any assessee objecting to the amount of income assessed under section 23 or section 27 or the amount of loss computed under section 24 or the amount of tax determined under section 23 or section 27, or denying his liability to be assessed under this Act, or objecting to the cancellation by an Income-tax Officer of the registration of a firm under sub-section (4) of section 23 or to a refusal to register a firm under sub-section (4) of section 23 or section 26A, or to make a fresh assessment under section 27, or objecting to any order under sub-section (2) of section 25 or section 25A or sub-section (2) of s. 26 or section 28 made by an Income-tax Officer, or objecting to any penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion " denying his liability to be assessed under this Act ". It is mainly these two types of appealable orders mentioned in s. 30(1) of the I.T. Act, which have been construed as not including within their ambit an order of rectification made under s. 35(1) of the I.T. Act. The scheme of s. 21 of the Expenditure-tax -Act does not appear to be similar. Clause (c) of sub-s. (1) of s. 21 of the Expenditure-tax Act, no doubt, corresponds to one type of order in s. 30(1) of the I.T. Act, already indicated. Similarly, cls. (d), (e) and (f) of sub-s. (1) of s. 21 refer to specific sections under which the appealable order is made. The assessee, in the present case, however, relies on cls. (a) and (b) of sub-s. (1) of s. 21, the ambit of which is not circumscribed by reference to any particular section as the source of power for making the order. Clause (a) refers to any order determining the amount of taxable expenditure " under this Act " while cl. (b) refers to an order determining the amount of expenditure-tax payable by the assessee " under this Act". The words " under this Act " must ordinarily mean " under any provision of this Act ". Without anything more to restrict the operatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). There is thus nothing in s. 21 of the Expenditure-tax Act, no other provision of the Act being relied on by the Revenue in support of its contention, to suggest that cls. (a) and (b) of sub-s. (1) of s. 21 are to be restricted in their application by circumscribing the wide ambit of their ordinary meaning. This analysis of s. 21 of the Expenditure-tax Act, and a further comparison of the same with s. 30(1) of the Indian I.T. Act, 1922, clearly show that cls. (a) and (b) of sub-s. (1) of s. 21 are wider in amplitude than the corresponding parts of s. 30(1) of the Indian I.T. Act, 1922 and, therefore, the decisions construing the latter provision are not decisive of the question before us. It may now be useful to refer to the decision in Mandal Ginning & Pressing Co. Ltd. v. CIT [1973] 90 ITR 332 (Guj). That too was a case in which a similar question arose with reference to the provisions of the Indian I.T. Act, 1922. The question was whether an appeal would lie under s. 30(1) against an order of rectification made under s. 35(1) of the Indian I.T. Act, 1922. The assessee in that case claimed the right of appeal under s. 30(1) of the Indian I.T. Act, 1922, by placing reliance on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued to mean " under any provision of the Act ". This other clause corresponds to cl.(c) of sub-s. (1) of s. 21 of the Expenditure-tax Act, with which we are not concerned in the present case, as the assessee relies only on cls. (a) and (b), for which the relevant reasoning given in the Gujarat decision has already been considered. Thus, the reasons on which a rectification order was held to be not appealable under s. 30(1) of the Indian I.T. Act, 1922, in the Gujarat decision, instead of supporting the Revenue, strengthen the contention of the assessee. It is clear that the reasons which compelled the Gujarat High Court to take that view are not present in this case. In fact, those reasons also indicate that but for the restricted right of appeal confined to assessment made under the specified provisions, which do not include s. 35(1) of the Indian I.T. Act, the right of appeal claimed by the assessee against an order of rectification would not have been refused. Section 61 of the E.D. Act, 1953, gives a similar power to rectify mistakes and the question arose whether such an order of rectification was appealable under s. 62 of that Act. It was held that an appeal lay against an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the earlier Gujarat case, which, as we have earlier pointed out, are implicit in the reasons given in the earlier decision itself. In our opinion, cls. (a) and (b) of sub-s. (1) of s. 21 of the Expenditure-tax Act, 1957, are much wider in amplitude than s. 30(1) of the Indian I.T. Act, 1922, to permit an appeal against an order of rectification made under s. 31 of the Expenditure-tax Act. We are also of the opinion that s. 21(1)(b) of the Expenditure-tax Act is as wide in its scope as s. 62(1)(b) of the E.D. Act, 1953, and, therefore, following the Kerala and the later Gujarat decisions construing s. 62(1)(b) of the E.D. Act, we hold that an appeal lies under s. 21(1)(b) of the Expenditure-tax Act against an order of rectification made under s. 31 thereof. We may also add that s.21(1)(a) also enables such an appeal since the order of rectification has the result of enhancing the amount of taxable expenditure, determined under this Act. We are, therefore, of the view that both cls. (a) and (b) of sub-s. (1) of s. 21 permit an appeal against an order of rectification made under s. 31 of the Act, which has the result of enhancing the taxable expenditure determined under this Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
