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TMI Blog1952 (12) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... in and Singapore. For the assessment year 1941-42 the Income-tax Officer calculated the assessee's accrued foreign income as Rs. 29,403 at Maubin, Rs. 27,731 at Kualalumpur and Rs. 34,584 at Singapore, in all Rs. 91,718. After deducting out of this amount Rs. 4,500 allowed under the 3rd proviso to Section 4(1) of the Act, the Income-tax Officer computed the total assessable foreign income at Rs. 87,218. Out of the total remittances of Rs. 84,352 the Income-tax Officer allocated Rs. 7,900 to the accrued income of Maubin and Rs. 62,315 to those of Kualalumpur and Singapore and the balance of Rs. 14,137 to the taxed income of earlier years. The Income-tax Officer disallowed the claim of the assessee to deductions under several heads. On the basis of the total foreign income of Rs. 67,218 and income from other sources the Income-tax Officer calculated Rs. 23,266-8-0 to be due by the assessee on account of income-tax, super tax and surcharges thereon and by his assessment order dated 31st January, 1942, made this amount payable on or before 25th February, 1942. The assessee preferred an appeal to the Appellate Assistant Commissioner against the disallowance of the several items of his c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 945, was made payable in equal moiety on or before 30th September, 1947, and 31st March, 1948. He, however, did not issue any notice of demand under Section 29 of the Act. Being aggrieved by the inclusion of Rs. 13,541 as the alleged unassessed foreign income of earlier years remitted to India during the year of account the assessee preferred an appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner was not satisfied that the assessee had any right of appeal under Section 30 of the Act for there had been no assessment under Section 23 and no notice of demand had been served on the assessee under Section 29 of the Act. Accordingly the Appellate Assistant Commissioner by his order dated 19th November, 1945, declined to admit the appeal. He, however, expressed the view that the assessee's remedy might lie in a miscellaneous application to the Tribunal complaining that the Income-tax Officer had either misconstrued or had not given effect to the order of the Appellate Tribunal. The assessee then brought a miscellaneous application to the Appellate Tribunal. The Appellate Tribunal held that the finding of the Income-tax Officer that the sum of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal in R.A.A. No. 53 (Madras) of 1942-43 was valid and correct. " The Appellate Tribunal made this further reference on 19th July, 1948, which came to be numbered as Case Referred No. 38 of 1948. The two referred cases came up for consideration before a Bench of the Madras High Court and it was held that the reference under Section 66(1) was incompetent in view of the earlier decision of that Court mentioned above which they felt to be binding on them and accordingly the Bench declined to answer the questions. The Commissioner of Income-tax thereafter applied for and obtained leave to appeal to this Court from the decisions in both the references and obtained such leave on his undertaking to pay the costs of the assessee in any event. The two appeals were thereafter consolidated and have come up before us for final disposal. Section 66-A(2) gives to the aggrieved party a right of appeal to this Court from any judgment of the High Court delivered on a reference made under Section 66 in any case which the High Court certifies to be a fit one for appeal to this Court. Section 66(5) provides that the High Court upon the hearing of any such case referred to it under Section 66 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 33. It was held that the granting of an application for rectification under Section 35 and correcting the error in the order was not an order under Section 33(4) and, therefore, was not one in respect of which Section 66(1) permitted a case to be stated. It was further held that if the Appellate Tribunal improperly or incorrectly made a reference in violation of the provisions of the statute, the High Court was capable of entertaining an objection to the statement of the case and that, if it came to the conclusion that the case should not have been stated, the High Court was not compelled to express an opinion upon the question referred. In the case before us there is no question that the present application was not made within time, but the contention is that Section 66(1) only contemplates an application for a reference of a question of law arising out of " such order " which clearly means an order made under Section 33(4), and, therefore, if there is no valid order under that section no question of law can be said to arise out of "such order" and consequently the Appellate Tribunal can have no jurisdiction to make any reference to the High Court under Section 66(1). Section 66(2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not prefer any appeal but only made a miscellaneous application before the Appellate Tribunal. There is no provision in the Act permitting such an application. Indeed, in the statement of the case the Appellate Tribunal states that in entertaining that application and correcting the error of the Income-tax Officer it acted in exercise of what it regarded as its inherent powers. There being no appeal under Section 33(1) and the order having been made in exercise of its supposed inherent jurisdiction, the order cannot possibly be regarded as one under Section 33(4) and there being no order under Section 33(4) there could be no reference under Section 66(1) or (2) and the appellate court properly refused to entertain it. The learned Attorney-General submits that this Court should not take such a narrow and technical view but should treat that miscellaneous application as really an appeal under Section 33. Turning now to Section 33 we find that any assessee objecting to an order passed by an Appellate Assistant Commissioner under Section 28 or Section 31 may appeal to the Appellate Tribunal within the time specified in sub-section (1) which time, however, may be extended by the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the Income-tax Officer his function was only to carry out the order of the Appellate Tribunal. He could not otherwise reopen the assessment already made by him under Section 23. Therefore, in carrying out the directions of the Tribunal and in doing what he did on 26th September, 1945, the Income-tax Officer cannot be regarded as having acted under Section 23 or Section 27 of the Act and that being the position no appeal lay from that order of the Income-tax Officer under Section 30(1) of the Act. The result of it was that there was no proper appeal before the Appellate Assistant Commissioner such as is contemplated by Section 30(1) and, therefore, the order made by the Appellate Assistant Commissioner cannot be regarded as an order made by him under Section 31(3), for an order under Section 31(3) can only be made in disposing of an appeal properly filed under Section 30, and consequently no further appeal lay to the Appellate Tribunal under Section 33(1) so as to enable the Appellate Tribunal to make an order under sub-section (4) of that section. In the premises, there being no order which may properly be said to have been made under Section 33(4), no question of law can be sai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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