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THE CHAMBER OF TAX CONSULTANTS

3, Rewa Chambers, Ground Floor, 31, New Marine Lines, Mumbai - 400 020 Tel.: 2200 1787 / 2209 0423 Fax: 2200 2455 E-mail: office@ctconline.org

Visit us at: Website: http://www.ctconline.org

STUDY CIRCLE MEETING

Thursday, 16th

April, 2015

Conference Hall, Consultair Investments Pvt. Ltd. Churchgate.

- Ajay Singh, Advocate

CHART FOR APPEALS UNDER CHAPTER XX

PARTICULARS CIT(A) TRIBUNAL HIGH COURT

INCOME TAX Sec. 246 to 251 Sec. 252 to 255 Sec. 260A & 260B

1.Orders Appealable Mentioned u/s.246A Mentioned u/s. 253. Mentioned U/s. 260A

2.Time Limit of Filing

the Appeal.

Within 30 Days from

the date of Receipt of

Notice of Demand.

Within 60 Days from

the date of Service of

CIT(A)'s order.

Within 120 days from

the date of

Communication of

Appellate Tribunal

order.

3.Prescribed Form No. Form No. 35.

(As per Rule 45)

Form No. 36.

(As per Rule 47(1))

As per High Court

original side Rules.

4.Who can file Appeal Aggrieved Assessee Aggrieved Assessee or

Commissioner.

Aggrieved Assessee or

Commissioner.

5.Fees Payable Rs.250/- where the

Assessed Income is

Rs.1 lakh or less; more

than Rs.1 lakh but less

than Rs.2 lakh-

Rs.500/- and more

than Rs.2 lakh-

Rs.1000/-

Rs.500/- where the

Income assessed is

Rs.1 lakh or less,

Rs.1,500/- where the

income assessed is

more than Rs.1 lakh

but less than Rs.2 lakh

and 1% of assessed

income, subject fee

maximum of

Rs.10,000/-

where the income

assessed income is

more

than 2 lakhs.

Ad-volarem fee

leviable on the amount

in dispute, i.e. the

difference between the

amount of tax actually

assessed and the

amount of tax admitted

by the assessee as

payable by him,

subject to a maximum

of Rs.10,000/- (only

by assessee). {As per

Article 16A to

Schedule I of the

Bombay Court Fees

Act}.

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6.Documents to be

Filed.

Form No.35, Grounds

of Appeal, Statement

of Facts, Copy of

Order against which

appeal is preferred,

Notice of Demand and

original challan of

filing fees.

Form No.36, Grounds

of Appeal, Copy of

Order against which

appeal is preferred, &

Documents filed

before the CIT(A)

as referred in the

column.

Memo of Appeal;

Statement of facts,

orders of the lower

authorities and

documents relied upon

the Tribunal and lower

authorities.

7. Documents to be

Submitted in :

Duplicate.

Triplicate.

Duplicate. One copy to

be served on

Respondent.

8.Place of Filing. CIT(A) as mentioned

in the Notice of

Demand.

Registrar of the

Appellate Tribunal.

Respective High

Court.

Cross Objection.

1.Prescribed Form No.

--- Form No. 36 A.

(As per Rule 47(1))

Rule 22 of order XLI

of CPC

2.Time Limit for filing

the Cross Objection.

--- Within 30 days of the

receipt of the notice of

appeal filed by other

party.

Within 30 days form

date of service of the

appeal.

3.Fees Payable. --- No Fees Payable. ---

Stay Application

1. Fees Payable

--- Rs.500/-

(w.e.f.1/10/1998) [per

application as per the

decision of the

Tribunal]

---

2. Documents to be

filed.

--- Stay Petition,

Rejection

order for stay by CIT

&

Assessing Officer

Affid-

avit, orders of lower

authorities &

documents

furnished to them.

---

Miscellaneous

Application

1) Fees Payable

--- Rs.50/-

(w.e.f. 1/10/98)

---

2) Documents to be

filed

--- Miscellaneous

Application Petition,

order of the Tribunal,

Affidavit

---

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APPELLATE PROCEEDINGS

Shri Ajay R. Singh

Advocate

Email: ajaysingh.legal@gmail.com

INTRODUCTION

Article 265 of the Constitution of India, provides as under : “Taxes not to be imposed save by

authority of law – No tax shall be levied or collected except by authority of law”.

Representation before the Assessing officer and first appellate authorities are foundation to the

appeal. For making a good representation we should know the facts, law and procedure.

Assessment as it is understood is a process of determination of any liability under the provision

of the tax laws (sec 2(8)).

Right of Appeal is a creature of Statute. A person has no inherent right of appeal and hence, it

cannot come under the category of fundamental rights. No Appeal lies unless it is provided by

the statute. (CIT vs. Garware Nylons Ltd. 212 ITR 242 – Bom). An appeal is a continuation

of assessment proceedings. Assessment proceedings complete when appeal against order of

assessment is decided by Tribunal CIT vs. Mayur Foundation (2005) 274 ITR 562(Guj.)

A. FIRST APPEAL: Section 246 confers the right to appeal before the CIT(A) in respect

of orders specified u/s. 246A of the Income-tax Act, 1961. The relevant Rules are

provided in Rules 45 to 47 of Income Tax Rules, 1962.

1. WHO CAN FILE APPEAL? - AGREED ASSESSMENT

1.1 "Every Assessee aggrieved" by any of the orders mentioned in Section 246 of the I.T.

Act, 1961 has a right to prefer an appeal. In Rameshchandra & Co. v. CIT 168 ITR 375

(380) (Bom), it has been held that where an assessee has made a statement on facts,

there can be no grievance if he is taxed on the basis of that statement. As there is no

grievance, there can be no appeal. When an Assessing Officer states in the Order that the

Assessee agreed for addition, he cannot file an appeal unless he challenges the

observation of the Assessing Officer by filing Affidavit - Western India Automobiles v.

CIT 112 ITR 1048 (Bom).

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1.2 Assessee should make application u/s.154 of the Act, challenging the observation of the

Assessing Officer and should also file an appeal specifically urging that he has not agreed for

additions and the same should be supported by an Affidavit.

1.3 It has been held by High Courts that even a third party has a right of appeal if, as a result

of an order he is saddled with a liability for any tax or other sum – (See Section 2(7) of

the Act)

Kikabhai Abdulali Vs. ITAT Bombay 32 ITR 762 (Bom); Benoy Kurian vs. Agrl. ITO

234 ITR 617 (Ker); CIT v. N. Ch. R. Row & Co. 144 ITR 557 (Cal), CIT vs. Ambala

Flour Mills. (1970) 78 ITR 256 (SC).

A. A person who is beneficially entitled to the income in respect of which he

is assessee through a trustee or agent or court of wards.

Shrimant Govindrao Narayanrao Ghorpode vs. CIT (1963) 48 ITR

54 (Bom), Inder Singh Gill vs. CIT (1963) 47 ITR 284 (Bom)

B. Where the assessee is dead, through legal representative;

Rajah Manyam Meenakshamma vs. CIT (1956) 30 ITR 286 (AP)

C. A coparcener, where the assessee has claimed to be a HUF:

Chandumal Pannalal vs. CIT (1965) 58 ITR 711 (Cal.)

D. Levy of interest u/s. 234B/234C is appealable on the ground that assessee denies his

liability to be assessed.

Jalgaon Dist. Central Co-op Bank Ltd. Vs. ITO [70 ITD 290 (Pune)]

(Central Province Manganese Ore Co. 160 ITR 961 (SC)

E. Certificate granted u/s 197 ? Section 248 provides for appeal by a person denying liability

to deduct tax i.e. for orders u/s 195.

The Bombay High Court held that no appeal lies from the order u/s 197 u/s 248 – CIT vs.

Garware Nylons Ltd. 212 ITR 242 (Bom)

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F. Protective assessment? In following cases, it has been held that even against Protective

Assessment, Appeal can be filed. 54 ITD 471 (Delhi) (SB)

E. Appeal can be filed by the director of erstwhile company, whose name was struck–off the

register by the Registrar of company.(S. 140,246 ,Companies Act 1956 , S. 560).

Ajay Ispat (P) Ltd v. ITO ( 2012)136 ITD 145(Ahd.)(Trib.)

G. After revision u/s. 264 – Appeal not maintainable u/s. 246A.

Orissa Rural Hsg Development Corporation Ltd (2012) 343 ITR 316 (Orissa)

1.4 The Hon’ble Bombay High Court in case of Nirmala L. Mehta vs. A. Balasubramanin

CIT (2004) 269 ITR 1 (Bom) held that there cannot be any estoppel against statute.

Article 265 of the Constitution of India provides that no tax shall be levied or collected

except by authority of law. [Also see Balmukund Acharya 310 ITR 310 (Bom)]. Same

income cannot be taxed twice R Natarajan (2012) 135 ITD 55 (TM )(Chennai)

1.5 Order Giving effect to Appellate order : Appealable :

An order giving effect to the appellate order bears the same characteristic as the original

order against which appeal was filed.

a) CIT vs. Industrial Machinery Manufacturing P. Ltd.

(2006) 282 ITR 595 (Guj.)

b) Bakelite Hylam Ltd. vs. CIT (1988)171 ITR 344(AP).

c) Where the Department denies its liability to pay interest on refund of self assessment tax,

the issue is appealable : Sec. 244A

Dy. CIT vs. BSES Ltd. (2008) 113 TTJ 227 (Mum)(para 19.6).

d) Order giving effect to revision order u/s. 264 – Appealable

Jasbir Singh v/s. ITO (2012) 76 DTR 36 (Asr). Trib.

e) Gausia Cold Storage Pvt. Ltd vs. ACIT (ITAT Mumbai)

S. 264: ITAT entertains appeal against order passed by CIT u/s 264

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2. PROCEDURE : GROUNDS OF APPEAL & STATEMENT OF FACTS:

2.1 An appeal should be filed within a period of 30 days of the service of the Assessment

order alongwith notice of demand. The same should be concise without any

argumentative or narrative. Language should not be very harsh. The grounds should

highlight the main controversy in issue. The grounds should not be vague, general or too

lengthy. Specific ground to be taken for each and every issues involved.

2.2 The Statement of Facts should be filed before the Commissioner (Appeals) wherein facts

can be narrate. It is advisable to file elaborate statement of facts covering all issues and

wherever possible, alongwith details filed before Assessing Officer and the case laws.

Filing of detailed statement of facts, along with supporting case laws will help the

Assessee, especially when appeals are disposed off by the first appellate authority ex-

parte. If certain factual errors are there in the order the same must be raised in the

grounds of appeal and statement of facts.

2.3 DELAY IN FILING APPEAL: An application for condonation of delay alongwith

affidavit stating the reasons for delay should be filed alongwith the appeal. The Hon’ble

Calcutta High Court in Charki Mica Mining Co. Ltd. vs. CIT (1978) 111 ITR 193 has

held that the limitation period commences from the date of receipt of notice of demand

by the Assessee and not from the date of receipt of Assessment order. Affidavit

should be properly drafted and notarized. (Kunal Surana vs. ITO (ITAT Mumbai)

May 28th, 2013.)

2.4 In Collector of Land Acquisition v. Mrs. Katiji & Others 167 ITR 471 (SC) the

Hon'ble Supreme Court has held that the Courts should have pragmatic & liberal

approach in admitting the appeal beyond the period of limitation. Also see N.

Balkrishnan Vs. M. Krishnamurthy (1998) 7 SCC 123, State of Nagaland vs. Lipuk

A.O. 2005 (183) E.L.T. 337 (SC), Earthmetal Electricals (P.) Ltd. vs. ITO (2005) 4

SOT 484 (Mum) and Bombay Mercantile Co-op. Bank vs. CBDT (2010) 45 DTR 377

(Bom).

2.5 Legal Principle culled out from various decision on condonation of delay are.

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a. The expression ‘sufficient cause’ must receive a liberal construction so as to

advance substantial justice and generally delays in preferring the appeals are

required to be condoned in interest of justice.

b. The primary function of any quasi-judicial body is furtherance of

administration of substantial justice.

c. Pragmatic justice oriented approach is required and not the technical

detection of explanation of every days delay.

d. Length of delay is immaterial.

e. A litigation does not stand to benefit by resorting to delay, therefore a justice

oriented approach is required by courts.

f. Since explanation of assessee did not smack mala fide or was not put forth as

a dilatory strategy, delay in filing appeal was to be condoned.

g. In every case of delay there can be same lapses on the part of the litigant

concerned, but that alone is not enough to shut the door against him.

h. Refusing to condone delay can result in a meritorious matter being thrown

out at the very threshold and cause of justice being defeated.

i. In matters of condonation of delay a highly pedantic approach should be

eschewed and a justice oriented approach should be adopted and a party

should not be made to suffer on account of technicalities.

3. PAYMENT OF TAX MANDATORY BEFORE FILING APPEAL.

3.1 Section 249(4) provides that no appeal shall be entertained unless at the time of filing the

appeal the assessee has paid the taxes due on the returned income or where no return is

filed, an amount equal to the amount of advance tax which was payable by him. The tax

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due does not include interest element. CIT vs. Manoj Kumar Beriwal (2009) 316 ITR

218 (Bom);

3.2 Case Laws: Once the assessee has complied with the provisions Appeal be heard on

merit:

i) Subbiah Nadur & Sons vs. ACIT 84 ITD 55 (Chennai)

ii) Mr. Purshottam G. Budhwani vs. ACIT

ITA No. 354/M/2009, dt. 21/1/2010, Bench “C”

iii) Anant R. Thakore vs. ACIT (2006) 5 SOT 298 (Mum)

v) Bhumiraj Constructions v. Addl. CIT (2011) 131 ITD 406 (Mum.)(Trib.)

4. CAN AN APPEAL BE SIGNED BY AN ADVOCATE / CHARTERED

ACCOUNTANT / AUTHORISED REPRESENTATIVE

4.1 As per Rule 45 of the Income Tax Rules, 1961, the form of appeal i.e. Form No. 35, the

Grounds of Appeal & the form of Verification appended thereto shall be signed &

verified by the person who is authorised to sign the return of income under section 140

of the I.T. Act, 1961. Thus it can be inferred that only in the case of an individual or a

company which is not resident in India, the return can be signed by a person who holds

a valid power of attorney, which shall be attached to the return.

4.2 In the following cases, it has been held that an appeal signed by an Advocate/C.A. is

valid -Mrs. Leezo Salidan v. CIT 16 TTJ 243 (Bom) Pyrkashim Stores v. CIT 9 ITD 93

(Bom) Hariledge v. ITO 29 Taxman 122 (Bom) (Tribunal) RajendraKumar Maneklal

Sheth (HUF) v. CIT 213 ITR 715 (Guj).Yusuf Husain v/s. ITO dt 5th

Feb 2013( Mum)(

Trib).

4.3 Defect in Appeal:

Defect in Appeal can be rectified by an amendment. The Assessee should be given

an opportunity to rectify the defect:

a) Malani Trading Co. vs. CIT (2001) 252 ITR 670 (Bom)

b) BDA Ltd. vs. ITO (TDS) (2006) 281 ITR 99 (Bom) (Aurangabad Bench)

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c) CIT vs. Calcutta Discount (1973) 91 ITR 8 (SC)

d) Prime Securities Ltd. vs. ACIT (2009) 317 ITR 27 (Bom)

5. Hearing: Assessee should file written submission and paper book at time of hearing.

5.1 The CIT(A) has power to make such further inquiry as he thinks fit or may direct the

A.O. to make further inquiry and report to him. Assessee is entitled to reply to the

remand report.

5.2 The CIT(A) has to pass a speaking order dealing with each grounds of appeals. The

CIT(A) should pass the order on merits even though heard exparte / or assessee did not

appear. - CIT vs. Chennaippa 74 ITR 41 (SC).

5.3 The CIT(A) cannot apply Multiplan (India) Ltd. 38 ITD 320, decision and dismiss the

assessees appeal exparte for non appearance. Gujarat Themis Biosyn ltd v/s. Jt CIT

74 ITD 339 (Ahd).

6. ADDITIONAL EVIDENCE

If the assessee is been prevented by good, sufficient or reasonable cause or adequate time

is not allowed such fresh evidence can be placed before the appellate authority by making

a Application U/R. 46A. Additional evidence has to be filed in duplicate. Ensure that

CIT(A) serves one copy to the Assessing officer and obtains a remand report.

The CIT(A) has to give a copy of remand report and further an opportunity to reply to the

remand report.If the assessee is been prevented by good, sufficient or reasonable cause

or adequate time is not allowed such fresh evidence can be placed before the appellate

authority by making a Application U/R. 46A.

- Effect of Rule 46A – Opportunity to A.O. to examine document and evidence. Rule

embodies provision of natural justice: CIT vs. Shree Kangra Steel Pvt. Ltd. (2010) 320

ITR 691 (HP)

6.1 The Commissioner (Appeals) would not be justified in rejecting additional evidence

produced before him – Smt. Prabhavati S. Shah v. CIT 231 ITR 1 (Bom); Dwarika

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Prasad v. ITO 63 ITD 1 (Patna)(TM). g) Manish Build Well Pvt Ltd. (2012) 204

Taxman 106 (Delhi)HC ( Considering Sec250(4) of the Act)

6.2 Under Rule 46A(4) the CIT(A) on its own discretion can ask the assessee to produce

documents or evidence. Additional evidence gathered by the CIT(A) on his own is not

required to be produced before A.O. for his comments.

a) ITO vs. Indl. Roadways (2008) 305 ITR 219 (Mum(AT).

b) ACIT vs. Prime Telesystems Ltd. (2007) 11 SOT 361 (Del.)

c) Dy. CIT vs. Thoresen Chartery Singapore (2009) 118 ITD 416 (Mum)

e) CIT vs. K. Ravindranathan Nair (2004) 265 ITR 217 (Ker.)

f) Jai Hind Co operative Sugar Mills Ltd (2011) 335 ITR 43 (P&H)

6.3 Permission to bring additional document can be granted in exercise of discretion of Court

to achieve ends of justice. (Smt. Shantibai K. Vardhan & Ors. Vs. Ms. Meera G. Patel

& Anr. AIR 2009 (NOC) 904 (Mum)

Filing of Translated copy of document in Court is not additional evidence. (Prahlad

Singh vs. Suraj Mal & Ors AIR 2009 Raj. 53)

7. RAISING ADDITIONAL GROUNDS

7.1 Sub-section 5 of Section 250 gives power to the Commissioner (A) to allow the

appellant to raise additional ground if he is satisfied that the omission of that ground

was not wilful or unreasonable.

a) Jute Corp. of India Ltd. vs. CIT 187 ITR 688 (SC) (FB)

b) Heinrichde Frics GMBH vs. Jt. CIT 281 ITR 18 (Mum)(AT)

8. JURISDICTION POINT.

8.1 The Assessee can raise the jurisdiction point at any time. - Union of India v. Rai Singh

Dal Singh 88 ITR 200 (SC), CIT v. Dumravan Cold Storage & Refrigerators Services

97 ITR 137 (Pat), The Assessee can raise the jurisdictional point before the Tribunal

also inrespect of reassessment proceedings. As it is a question of law which goes to the

root of the matter. Inventors Industrial Corporation Ltd. vs. CIT 194 ITR 548 (Bom).

Invalid jurisdiction cannot be corrected by Sec. 292B [Saraf Gramodyog Sanshtan 108

ITD 115 (Agr.)] . Technical defect in notice or proceedings would not render proceedings

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invalid. However, jurisdictional defect cannot be cured - CIT v. Norton Motors 275

ITR 595

9. MAKING A CLAIM FOR THE FIRST TIME BEFORE APPELLATE

AUTHORITY

9.1 If there was evidence or material on record, then only a claim made for the first time be

entertained by the Appellate Authority. CIT v. Western Rolling Mills Pvt. Ltd. 154 ITR

54 (Bom).

9.2 The Board have issued instructions from time to time in regard to the attitude which the

Officers of the Department should adopt in dealing with assessees in matters

affecting their interests and convenience. Circular No.14(XL-35) of 1955,

C.No.13(207)-IT/50, dated 11th April, 1955, states that the Officers of the Department

must not take advantage of ignorance of an assessee as to his rights.

9.3 However the decision of S.C. in the case Goetze (India) Ltd vs. CIT 284 ITR 323 (SC)

has held that it was open to the assessee to raise new points of law before the Tribunal.

The Tribunal has such powers u/s. 254 of the Act.

9.4. A.O. is bound to assess the correct income and for this purpose the Assessing officer may

grant relief’s / refund sou motu or can do so on being pointed out by the assessee in the

case of assessment proceedings for which assessee has not filed a revised return.

Case Law After Considering Goetze (India) Ltd. (Supra)

a) CIT v. Pruthvi Brokers & Shareholders Pvt. Ltd (2012) 208 Taxman 498/252 CTR

151(Bom.).

9.5 However, the A.O. cannot entertain a claim for deduction otherwise than by filing a

revise return.

9.6 In case where assessment is not pending and the time available for filing a revised return

is also expired, the only remedy is to seek extension of time u/s. 119(2) from the Board

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for filing a delayed return in case of genuine hardship. (See Bombay Mercantile Co-op

Bank vs. CBDT (2010) 45 DTR 377 (Bom).

The assessee can also file rectification application u/s. 154 on facts of the case or make a

application to CIT u/s 264.

10. POWERS OF THE CIT(A)

10.1 Power to Stay the Recovery Proceedings

In following cases it has been held that the CIT(A) has the power to Stay the Recovery

Proceedings. City and Industrial Development Corporation of Maharashtra Ltd v.

ACIT (2012) 343 ITR 102 (Bom.), Balaji Universal Tradelink (P) Ltd. v. UOI (2012)

76 DTR 132 (Bom.). Haresh Ravji Majithiya v/s.ACIT (2014) 227 Taxman 211(Mag)

BOM. HC.; Nikhil Kelkar v/s. ITO (2014) 225 Taxman 196 (Mag) Bom. HC.

The Hon’ble S.C. in the case of ITO vs. M.K. Mohammed Kunhi (1969) 71 ITR 815

(SC) held that power to grant stay is incidental or ancillary to its appellate jurisdiction.

In Employees’ Provident Fund Organization vs. ACIT (ITAT Delhi).S. 253(1)(a): An

appeal can be filed before the Tribunal against an order of the CIT(A) rejecting the stay

application

The guidelines to the Income Tax authorities while deciding stay application is

provided by Bombay High Court in.

- KEC International Ltd. vs. B.R. Balakrishnan & Ors.

(2001) 251 ITR 158 (160) (Bom)

- Mahindra & Mahindra Ltd. vs. UOI 1992 (59) ELT 505 Bom.

- Strictures were passed against dept for disposing stay application without proper

reasons. Paramount Health Services v/s. ACIT

(2010) 37 DTR 377 (Bom) ; SRAv/s. DIT (E)(2014)112 DTR 209 (Bom)(HC).

10.2 Power of Enhancement

The CIT(A) has power to confirm, reduce, enhance or annual the assessment; confirm or

cancel or vary or enhance or to reduce the penalty and may pass such orders in the appeal

as he thinks fit.. However the CIT(A) should give reasonable opportunity of hearing to

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the assessee. Notice is mandatory, Infrastructure Development Finance Co.ltd. 213

Taxman 28 Mag. (Mad) (HC).

The filing of an appeal may lead to grave consequences of enhancement of assessment.

The Explanation provides that CIT(A) may consider and decide any matter arising out of

the proceedings, notwithstanding that such matter was not raised before the CIT(A).

Thus CIT(A) powers are very wide. The scope of his powers is conterminous with that of

AO. He can do what AO can do and can also direct him to do what he has failed to do.

[CIT Vs. Kanpur Coal Syndicate 53 ITR 225(SC)]

However he has no jurisdiction to assess a source of income which is not disclosed either

in the ROI or in the assessment order. Thus it is not open to him to travel outside the

record for finding out new source of income. [CIT Vs. Rai Bahadur Hardutroy Motilal

Chamaria - 66 ITR 443(SC)]

In CIT Vs. Nirbheram Daluram [224 ITR 610] the Supreme Court held that the CIT(A)

can make addition in respect of new source of income if it is not considered by AO.

No power to consider validity of Act or Rules [CIT Vs. Straw Products Ltd. 60 ITR 156

(SC)]

"Any matter arising out of the proceedings“.

It extends to all matters arising out of the proceedings which might have been considered

and determined by the AO in the course of the assessment although such matters might

not have been raised by the assessee. The competence of the appellate authority ranges

over the whole assessment proceedings without restrictions on him. His jurisdiction is

therefore, not confirmed to the subject matter of the appeal but extends to the subject

matter of assessment. Ugar Sagar Works Ltd. Vs./ CIT -141 ITR 326 (Bom). Issues

which are subject matter of revision u/s. 264 cannot be enhanced by commissioner

appeals, Hindustan Colas Ltd. (2013) 140 ITD 277 (Mum).

Commissioner (Appeals) has power to consider such items which was considered by

the Assessing Officer and enhance assessment.

Items considered by the AO but no addition made. It was held that commissioner appeal

has power to consider such items and enhance assessment. Accordingly addition made by

the Commissioner (Appeals), on the basis of analyzing the documents which was

confirmed by the Tribunal was held to be proper. (Block Period 1990‐91 to 2001‐02)

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Gurinder Mohan Singh Nindrajog v. CIT (2012) 348 ITR 170 (Delhi)(High Court);

Enhancement – Income from same source of income - Held valid.

Qualcomm Incorporated v/s. ADIT 85 DTR 156 (Del)(URO)

10.3 The CIT(A) powers u/s. 251 are vide enough to include the power to examine all matters

covered by the assessment order and to correct the assessment. The Powers of CIT(A)

are conterminous with those of the Assessing Officer.

166 ITR 494 (MP) Indermal Natwarlal vs. CIT

206 ITR 574 (Guj) CIT vs. Ahmedabad Crucible Co.

131 ITR 451 (SC) Kapoorchand Shrimal vs. CIT

305 ITR 310 (Chennai) AT Ansaldo Energia SPA vs. Astt. DIT

(2012) 138 ITD 355 (Mum.)(Trib.) Ratan J. Batliboi v. ACIT

10.4 However the jurisdiction of the appellate authority u/s. 251 is strictly confined to the

Assessment order of the particular year under appeal as held in ITO vs. Murlidahr

Bhagwan Das 52 ITR 335 (SC),

- Power of CIT (A) – Finding – Direction – Only in respect of year under appeal. Sun

Metal Factory I Pvt Ltd v/s. ACIT (2010) 124 ITD 14 (Chennai).

- Power of CIT Appeal on remand by ITAT on specific issue – CIT Appeal in second

round cannot raise a new plea. Ritz Theatre v/s. ITO 194 Taxman 544 Del.

- Matter remanded by ITAT with set out parameters, CIT (A) cannot examine the entire

nature of payment . White line Chemicals (2012) 216 Taxman 242 (Guj)(HC)

B. PROCEEDINGS BEFORE THE I.T.A.T

1 INTRODUCTION

The Income Appellate Tribunal (in short the “Tribunal”) was set up on 25th

January,

1941, as an independent quasi-judicial body functioning under the Union Ministry of

Law and Justice. “The Supreme Court in Ajay Gandhi & Anr. Vs. B. Singh & Ors.

(2004) 186 CTR (SC) 506 : (2004) 265 ITR 451 (SC) observed : “The Tribunal exercises

judicial functions and has the trappings of a Court”.

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ITAT v/s. V. K Agarwal 235 ITR 175 (SC)- Contempt of court Act.

In the case of J.C. Augustine vs. ACIT (2009) 312 ITR 60(AT)(Coch) the Cochin Bench

had observed that ITAT was not an income tax authority for the purpose of Income tax

Act.

The ITAT does not form part of the list of hierarchy of the Income-tax authorities as per

section 116 as it is not an Income-tax authority. The ITAT, like the Income-tax

department, does not function under the Ministry of Finance but it is constituted and

functions under the Ministry of Law and Judiciary, Government of India. The powers of

Tribunal are similar to the powers of an appellate court under the code of civil

procedure. The Tribunal is considered to be the final fact finding body and its

decisions on facts of the case are, ordinarily, not liable to be questioned before the

High Court.

1. WHO CAN FILE AN APPEAL AND PRESENTED TO WHOM?

1.1 As per Section 253, any Assessee aggrieved by the order of the Commissioner (A) may

prefer an appeal to the Appellate Tribunal. Similarly, the Commissioner may object to the

order of the Commissioner (A) & direct the Assessing Officer to file an appeal to the

Appellate Tribunal.

It has been held by High Courts that even a third party has a right of appeal if, as a result

of an order passed in an appeal by the first appellate authority before whom he is not a

party, he is saddled with a liability for any tax or other sum – (Discussed above)

2. TIME LIMIT FOR PREFERRING APPEAL

2.1 An appeal should be filed within Sixty days of the receipt of the order of the

Commissioner (A) in the prescribed Form No. 36.

2.2 As per order No. 1 of 1973 dated 10/7/1973, [F. No. F-161-AD(AT)/70 – 90 ITR (St.)

25], the Registrar of the Income Tax Appellate Tribunal has authorised Assistant

Registrar of different places to receive appeals. However, if it is last day of presenting

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Appeal, the same can be presented at Residence of the Registrar or even residence of the

Members or wherever they may be.

2.3 According to Rule 6(2) of the ITAT Rules, 1963, if the appeal is being sent through post

then in such cases it must be through Registered post addressed to the Registrar or other

authorised officer of the Tribunal. However, the most important point to be borne in mind

is that it shall be deemed to have been presented on the day on which it is received in the

office of the Tribunal. Any delay in transmission by post may not be excluded in

computing the period of limitation. This is so because under the general law, the postal

authorities are not considered as agents of the addressee but they are agents of the sender.

[F. N. Roy vs. Collector of Customs AIR 1957 (SC) 648].

In case of delay in filing the appeal, on Application for condonation of delay alongwith

the affidavit of the assessee and supporting document must be filed alongwith the appeal.

The assessee should disclose sufficient and reasonable cause for the delay.

3. GROUNDS OF APPEAL & STATEMENT OF FACTS.

3.1 As per Rule 8 of the Appellate Tribunal Rules, every memorandum of appeal shall be

written in English. The same should be concise without any argument ot or narrative.

3.2 The Statement of Facts should be filed before the Commissioner (A). It is very vital

for the assessees to present the statement of facts in such a manner so as to bring out

clearly the steps in the assessment/penalty proceedings leading to the order under

challenge. There is no requirement of filing of Statement of Facts before the

Appellate Tribunal.

1. Jagjivandas Nandlal vs. ITAT (Bombay High Court)

ITAT President requested to make it compulsory for assessees to amend Form

36 for change of address instead of intimating vide letter

3 CROSS OBJECTIONS.

3.1 If the assessee or the Assessing Officer prefers an appeal to the Tribunal u/s.253(1) or

(2), as the case may be, and the appeal is not rejected under rule 12 of the ITAT Rules,

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1963, a notice is given by the Tribunal to the respondent informing him of the fact of

such filing, also enclosing the memorandum and grounds of appeal. The respondent can

file, u/s.253(4), a memorandum of cross objections in Form No.36A, within 30 days from

the date of receipt of such notice, against any part of the order of the first appellate

authority deciding any issue against him. In case of delay Application for Condonation of

delay should be filed. Delay is condonable in belated cross objection.

Vareli Textile P. Ind. 154 Taxman 33 (Guj.)

Sterlite Ind India ltd v/s. Addl CIT 2006 102 TTJ 53 (Mum)

Dy CIT v/s. Harshad S Mehta (2007) 17 SOT 504

The cross objection filed is registered and numbered. It should be heard alongwith the

original appeal.Cross objection to be considered as an appeal and should be disposed of.

TATA SPONGE V/S. CIT 2008 307 ITR 441 orissa.

ITO vs. Jasjit Singh (ITAT Delhi)

S. 253: In a cross-objection, a new legal issue can be raised

for the first time before the ITAT.There is no difference between an

appeal and a cross-objection. In a cross-objection, a legal issue which

has not been raised before the lower authorities can be raised. The

C.O. need not be confined to the points taken by the opposite party in

the main appeal

4 In absence of Cross appeal the Respondent still has Right to agitate its point via R.

27.of ITAT

Dahod Suhakar Kharid 282 ITR 321 (Guj.)

The respondent is not required to pay any filing fees as per rule 22 and the Tribunal shall

dispose off such memorandum of cross objections as if it were an appeal. Rule 27 of the

ITAT Rules, 1963, empowers the respondent to the order appealed against on any of

the grounds decided against him, though he may not have appealed or filed a cross

objection. Vahivatdars of Ambaji Temple vs. CIT 58 ITR 675, 684 (Guj).

Few Case Laws

Dy. CIT vs. Turquoise Invest. 299 ITR 143 (MP)

B.R. Bamsi vs. CIT (1972) 83 ITR 223 Bom (245 – 246)

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Power of the Appellate Tribunal are similar to the powers of an appellate court under the

CPC. The Respondent in an appeal is entitled to support the decree which is in his

favour on any grounds which are available to him, even though the decision of the lower

court in his favour may not have been based on these grounds.

Assam Co. (India) Ltd. vs. CIT (2002) 256 ITR 423 (Gauh.) (Pg. 439-440)

It is permissible on the part of the Tribunal to entertain a ground beyond those

incorporated in the Memorandum of appeal though the party urging the said ground had

neither appealed before it nor had filed a cross – objection in the appeal filed by the other

party. The evidentiary facts in support of the new ground must be available on record.

Dy. CIT vs. Bifora Watch Co. 94 ITD 203 (Mum) (TM) Pg. 211 Para 21

The assessee can raise additional ground u/R 27 though neither appeal nor cross objection

is filed by the assessee.

Smt. Narasamma vs. Asst. CIT (2002) 75 TTJ 298 (Bang.) (Para 4 Pg. 302)

The Tribunal has the discretion to allow any party to an appeal may be the appellant or

the respondent to raise a new point or new contention provided two conditions are

satisfied:

a) No new facts are required to be brought on record for disposing of such new

point.

b) An opportunity is given to the other side to meet the point.

5. FEES PAYABLE

5.1.1 Before the amendment to Sec. 253(6) w.e.f. 1-10-1998, appeal made on or after 1-6-1992

were to be accompanied by a fee of Rs.250/- in case where the total income assessed

by the assessing officer is one lakh rupees or less and by a fee of Rs.1500/- where

total income assessed is more than one lakh rupees.

5.1.2 However, w.e.f. 1-10-1998, every memorandum of appeal shall be accompanied by a fee

of-

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(a) Rs.500/- where the Assessed Income is Rs.1 lakh or less;

(b) Rs.1,500/- where the Assessed Income is more than Rs.1 lakh but less than Rs.2

lakh;

(c) 1% of the Assessed Income, subject to a maximum of Rs.10,000/- where the

Assessed Income is more than Rs.2 lakhs; and

(d) With effect from 1-6-1999, where the subject matter of an appeal relates to any

matter, other than those specified in clauses (a), (b) and (c) above, then the fees

payable would be Rs.500/-.

Note:

A. In case of Appeal against levy of penalty u/s. 271(1)(c) appeal fee is payable Rs.

500/-

Dr . Ajith kumar Pandey v/s ITAT 310 ITR 195(Pat)

(After referring Bidyut Kumar Seth vs. ITO 92 ITD 148 (Kol.)(SB)

B. the term ‘assessed income’ for this purpose, it seems, means assessed as

per the original order, not as per the revised income recomputed in the

order giving effect to the appellate order.

C. Total income is loss it will be caluse (d) of sub-section (6) of Sec. 253 –

Rs. 500 Gilbs Computer (2009) 317 ITR 159 (Bom)

D. In appeal against Revision order u/s.263, fees Rs.500/- Kiranjit Singh

(2006) 101 TTJ 424 (Asr.) ;Chromatic India ltd v/s. ITO ; ITA no.

3486/M/01 bench D dt12-2-02

E. Appeal dismissed on ground of limitation – Fees Rs. 500

Rajkamal Polymers Pvt. Ltd. vs. CIT 291 ITR 314(Ker.)

F. No appeal fee is payable by the department in a departmental appeal. No

fee is payable either by an assessee or the department on a cross-objection

filed by them.

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6. Monetary Limits for filing appeal:

Tax effect

CBDT Instruction No. 5/2014 dated 10.07.2014 prescribing Monetary limits for filing

appeal by the Department.

Tax effect

a) Appeal before ITAT Rs.4 lacs

b) Appeal before High Court Rs. 10 lacs

c) Appeal before the S.C. Rs. 25 lacs

(Also see Instruction No. 5/2008, dated 15/5/2008 wherein it has been held that for the

purpose of tax effect interest will not be included. Similarly in loss cases notional tax

effect should be taken into account. In cases of penalty order the tax effect will mean

quantum of penalty.)

In cases involving substantial question of law of importance’s as well as cases where the

same question of law will be repeatedly arise it should be considered separately on

merits. CIT vs. Surya Herbal Ltd (Supreme Court): CBDT’s low tax effect circular not

applicable to matters having “cascading effect”

Decisions : CBDT instruction binding on Revenue

(2009) 222 CTR 328 (Bom) CIT vs. Polycott Corporation

(2007) 294 ITR 419 (Bom) CIT v/s.Arvind Nilkanth kedar

276 ITR 519 (Bom) CIT vs. Pithwa Engg. Works

(2002) 254 ITR 565 (Bom) CIT vs. Camo Colour Co.

The objective of the CBDT instruction is squarely to reduce avoidable tax litigation.

7. Power of Stay:

7.1.1 In Stay Petition, a fee of Rs.500/- is payable. However, if single application for stay of

recovery is made to ITAT for number of assessment years, then the filing fees payable

u/s.253(7) would be Rs.500/- only and not Rs.500/- per assessment year – Shri

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Chiranjilal S. Goenka (Deceased) by his sole Executrix Mrs.Sushila N. Rungta,

Mumbai Vs. WTO, S.A. No.30/Mum/1999 [arising out of W.T.A. No.105, 106 and

107/M/97 for Assessment Years 1989-90, 1992-93 & 1993-94] Mumbai, Bench ‘A’,

order dated 27/9/1999.

7.1.2 Power of the Tribunal to grant stay of recovery is toward tax, interest and even penalty.

Bhoja Reddy vs. CIT (1998) 231 ITR 47 (AP(48)

Shiv Shakti Rubber & Chemcial Works vs. ITAT 213 ITR 299 (All)

7.1.3 Rejection of Stay Petition by CIT is Required before proceeding to ITAT. RPG

Enterprises vs. Dy. CIT (2001) 251 ITR 20 (AT)(Mum)

Contrary Decision:

Security & Detective Bureau Ltd. vs. ACIT (1993) 46 ITD 86 (Chennai)

Reuters India Pvt. Ltd. vs. Dy. CIT (2004) 3 SOT 886 (Delhi)

Asessee has to file separate stay petition for each assessment year.

Wipro Ltd. vs. ITO (2003) 86 ITD 407 (Bang).

7.4 Stay is effective for 180 days further extension of 180 days.

B. Sudhadra vs. ITO 272 ITR 100 (AT)(Hyd.)

Assessee can make fresh application

Tribunal has power to extend period of stay. Narang Overseas P. Ltd. vs. ITO (2007) 295

ITR 22 (Bom)

CASE LAW ON STAY:

a. Where the income determined on assessment is more than twice the income returned,

collection of tax should be stayed during appeal. Demand raised in high pitched

assessment need to be stayed, as its recovery would cause genuine hardship.

Maharana Shri Bhagwat Singahiji of Mewar v ITAT (1997) 223 ITR 192 (Raj).

Soul vs. Dy. CIT (2008) 173 Taxman 468 (Del.).

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b. The Hon’ble Delhi High Court in the case of Valvoline Cummins Ltd vs. Dy. CIT

(2008) 307 ITR 103 (Del) has considered the Instruction No. 96 dated 21/8/1969

issued by the CBDT and held that where the income determined is substantially

higher than the returned income, that is, twice the latter amount or more, than the

collection of tax indispute should be held in abeyance till the decision on the appeal is

taken.

c. Soul vs. Dy. CIT (2008) 220 CTR 211 (Del.)

Issue: Whether the decision in Valvoline Cummins Ltd. vs. Dy. CIT (2008) 307 ITR

103 relying on Instruction No. 96 is bad in law in view of instruction no. 1914 of

1993 dt. 2/12/1993.

Held: Although Instruction No. 1914 of 1993 specifically states that it is in

supersession of all earlier instructions, the position obtaining after the decision of this

Court in Valvoline Cummins Ltd.(supra) is not altered at all.

The very question as to what would constitute the assessment order as being reasonably

high pitched in consideration under the said Instruction No. 96 and, there, it has been

noted by way of illustration that assessment at twice the amount of the returned income

would amount to being substantially higher or high pitched.

6. Paper Book

It is desirable that a detailed paper book in conformity with rule 18 of the Income-tax

(Appellate Tribunal) Rules, 1963, is submitted in triplicate, as of the Income-tax

(Appellate Tribunal) Rules, 1963, is submitted in triplicate, as early as possible.

Whatever papers or documents or statements are proposed to be referred to or relied upon

at the time of hearing deserve to be included, indexed and paged and submitted before the

date of hearing of the appeal along with proof of service of a copy of the same on the

other side at least a week before.

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Each paper should be certified as true copy by the party filing the same, or his Authorized

Representative and indexed in such a manner as to give the brief description of the

relevance of the document, with page numbers and the authority before whom it was

filed.

No supplementary paper book can be submitted without the permission of the Bench. If

the paper book is found not in conformity with the rule, can be ignored by the Bench.

Paper Book is an important document and deserves to be prepared with caution and care.

The Tribunal may suo motu direct the preparation of a paper book at the cost of the

appellant or the respondent containing copies of such statements, papers and documents

as it may consider necessary for the proper disposal of an appeal.

7. Hearing:

The Tribunal shall notify to the parties the date and place of hearing of the appeal.

Sufficient time should be given. In case, any party is prevented by good, sufficient or

reasonable cause from getting the appeal argued on the specified date, must make an

application for adjournment sufficiently in advance and supported by the supporting

material. Authority Letter / Vkalatanama.should be filed in original.

The pecuniary jurisdiction of Single Member is Rs. 5 lakhs.( By Finance Bill 2015 limit

has been increased to Rs 15 lacs). Other appeals are heard by a Division Bench

constituted of a Judicial and an Accountant Member. Looking to the intricate law and

difficult accounting principles, admixtures of the two is appreciable and has assisted in

dispensation of justice. It provides healthy atmosphere to interact and co-exist. Wealth-

tax appeals can be heard by any two Honourable Members. The ordinary rule is that in

case of a difference of opinion on any point or points between the Members of a Division

Bench, the view of the majority shall prevail. But if the Members are equally divided, the

duty of the members who heard the appeal is to state the point or points on which they

differ and to refer the case to the President of the Tribunal for a hearing on such point or

points to one or more other Member and such point or points shall be decided according

to the opinion of the majority of the Members. The Third Member can only decide the

point or points referred to him.

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8. POWERS OF THE TRIBUNAL

8.1 The Tribunal being the final fact finding authority enjoys all the powers conferred

upon by the Act on the authorities mentioned in Section 116 & has a Status of a

independent judicial body as per the provisions of Section 252 to 255 of the Act. The

powers conferred on the Tribunal to pass “such orders thereon as it thinks fit” be

discovered by reference to the jurisdiction of the authority whose order has given rise to

the appeal – CIT vs. Ram Murti 87 ITR 577 (All).

8.2 Every appellate authority has implied and incidental power to grant relief even if the

statute does not provide.

Bulk India Transport 266 ITR 144 (All)

Mohammed Katri 71 ITR 815 (SC)

8.3 To issue appropriate direction

Kapurchand Shrimal 131 ITR 451 (SC)

- Consequential direction in interest of justice.

Matchless Machines & Technology vs. ITO ITA No. 8/M/2006 DT. 12/12/2008.

8.4 Right of assessee is not restricted to the plea raised by him. It is the duty of the authority

to allow relief on any other ground, if permissible

Ciba of India Ltd. vs. CIT (1993) 202 ITR 1 (Bom)

CIT vs. Mahalaxmi Textiles Ltd. (1967) 66 ITR 710 (SC)

Power of the Tribunal to grant relief under an alternate section – ITO vs. M.M. Textiles

28 DTR 321 (Mum) (Trib.)

Tribunal has inherent power to refix case for hearing to prevent Miscarriage of justice or

to grant substantial justice – opportunity of hearing should be given.

Mafatlal Securities Ltd. vs. Jt. CIT (2009) 119 ITD 444 (Mum)

8.5 Revenue cannot be given second innings to improve its case to make an addition.

216 ITR 99 (Ahd.) (AT) (Pg. 123) ITO vs. Gurubachansingh J. Juneja (Ahmed.)

73 ITD 125 (Del) (TM) ACIT vs. Anima Investment Ltd.

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168 ITR 472 (Guj) CIT vs. Harikrishna Jethalal Patel

154 ITR 745 (Ker.) Travencore Tea Estates Co. Ltd. vs. CIT

9. POWER TO ADMIT ADDITIONAL GROUNDS

9.1 Rule 11 of the ITAT Rules, 1963, provides that the appellant shall not except, by leave of

Tribunal, urge or be heard in support of ground not set forth in the memorandum of

appeal. However, the Tribunal is competent to allow the appellant to raise at the hearing

of the appeal an additional ground even without a formal amendment of the

memorandum of appeal.

9.2 National Thermal Power Co. Ltd. vs. CIT 229 ITR 383 (SC),

Jute Corporation of India v. CIT 187 ITR 688 (SC); Ahmedabad Electricity Co. Ltd. v.

CIT 199 ITR 351 (Bom); Ramgopal Ganpatrai & Sons v. CIT 24 ITR 362 (372) (Bom);

Anam Venkata Krishna Reddy v. CIT 172 ITR 425 (A.P.); Deepchand Kothari v. CIT

171 ITR 381 (Raj); J.S. Parkar v. V. B. Palekar 94 ITR 616(Bom). Leave to urge

additional grounds may be sought either in writing or by oral prayer. Rule 11 of the

Appellate Tribunal Rules speaks only of leave and the leave may be sought for either in

writing or by an oral prayer - Amines Plasticizers Ltd. v. CIT 223 ITR 173 (Gauhati).

Grounds of Appeal can be amended by taking leave of the Tribunal orally - Assam

Carbon Products Ltd. v. CIT 224 ITR 57 (Gauhati). 262 ITR 385 (Bom) Baby

Samuel vs. Astt. CIT

9.4 Additional Ground challenging the validity of assessment for want of jurisdiction can be

urged before any authority for the first time. Bar of estoppel or resjudicata does not

apply.

ACIT vs. Bijay Shankar Gupta (2009) 21 DTR 254 (Jd(Trib).

Question of limitation goes to root of the matter, duty of ITAT to consider the same

though raised for first time before it.

Mah & Mah ltd v/s. Dy CIT (2009) 22 DTR 361 (Mum )(SB)Trib.

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In CIT vs. Hindustan Tin Works Ltd. (2009) 24 DTR 88 (Del.) the Delhi High Court

upheld the order Tribunal in rejecting the revenue plea to raise additional ground

pertaining to section 14A for disallowing expenditure incurred for earning exempt

dividend income because neither during the assessment proceeding nor during appellate

proceedings before CIT(A) the revenue had invoked 14A.

Issue raised before the AO has to be considered by the ITAT though the CIT (A) did not

render any view on it. Jehangir H C Jehangir V/s. ITO (2014) 112 DTR 262 (Bom) HC

Power to admit Additional Evidences before the Tribunal

9.5 Rule 29 does not confer any right on the parties as such to produce any additional

evidence either oral or documentary before the Tribunal. Such power has been vested

only in the Tribunal to admit fresh evidences & affidavits, etc. - CIT v. Smt. Kamal C.

Mehboobbani 214 ITR 15 (Bom); Dy.CIT v. Vira Construction Co. 61 ITD 33

(Mum)(TM). Where additional evidence enables the Tribunal to pass orders or for any

other substantial cause, it can require the parties to do so - Abhay Kumar Shroff v.

ITO 63 ITD 144 (Patna)(TM). If evidence produced by assessee is genuine, reliable

and proves assessee's case, then assessee should not be denied opportunity of it being

produced for the first time before the appellate authority - Jagbir Singh v. ITO 23 ITD

15; Electra (Jaipur) (P.) Ltd. v. IAC 26 ITD 236

9.6 In CIT vs. Motilal Hirabhai Spinning & Weaving Co. Ltd. 113 ITR 173 (179,180)

(Guj.), it was held that though the omission to record reasons as required by rule 29 was a

serious defect, it is not mandatory and the omission to record reasons for admitting

additional evidence did not vitiate such admission.

9.7 Newspaper report on Mkt condition admitted as evidence

Addl CIT v/s. Ratan cold storage 118 ITD 31(Agra)(TM)

Power to Remand.

9.8 In cognizance of the Circular of the CBDT issued in 1955, and the decision in Navnit Lal

C. Javeri vs. K.K. Sen 56 ITR 198, although at the time of the original assessments, the

assessee firm itself did not claim any relief u/s.84/80J and though the responsibility for

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claiming refund and reliefs rested with the assessee, the assessing officer should have

drawn the attention of the assessee to this relief u/s.84/80J to which the assessee appeared

to be clearly entitled but which the assessee had omitted to claim – Chokshi Metal

Refinery vs. CIT 107 ITR 63 (Guj.).

9.9 Under Rule 28 of the ITAT Rules, 1963, the power of remand is only incidental to its

power to hear and dispose of the appeal. But power of remand cannot exceed the

jurisdiction u/s.254(1). Hence, Tribunal cannot exercise the power of remand for purpose

of enhancing the tax – V. Ramaswamy Iyengar vs. CIT 40 ITR 377 (Mad).

On remand Tribunal cannot direct to assess income less then returned income or at higher

than the assessed income.

CIT vs. H.P. State Forest Corp. Ltd. (2010) 36 DTR 181 (HP)

Coca Cola India (P) Ltd. vs. ITO (2007) 290 ITR 464

Bhav Shakti Steel Mines P. Ltd. vs. CIT (2010) 320 ITR 619 (Del.)

Power of Enhancement.

9.10 U/s.254(1), the Tribunal is not competent in an appeal filed by the assessee to give a

finding which is adverse to the assessee and make the latter’s position worse than before,

thus resulting in an enhancement of assessment – Puranmal Radhakishan & Co. vs. CIT

31 ITR 294 (Bom). Where a setting aside of the entire order of assessment and a remand

order has the effect of the probability of resulting in an enhancement of the Assessment

under appeal, the same cannot be done. The Tribunal is not empowered to do indirectly

what it cannot directly do – V. Ramaswamy Iyengar vs. CIT 40 ITR 377 (Mad);

Pathikonda Balasubba Setty (Deceased) vs. CIT 65 ITR 252 (Mys.).

- McCrop Global P. Ltd. vs. CIT 309 ITR 434 SC

Tribunal had no power to take back the benefit conferred by the AO or enhance the

assessment

An appellant cannot be worse off by being in appeal before Tribunal

- McCrop Global P. Ltd. vs. CIT 309 ITR 434 SC

- Integrated Feeder Containers Services vs. Jt. CIT 2005 (4) SOT 357 (Mum)

28 | P a g e

- Jt. CIT vs. Sakura Bank Ltd. 100 ITD 215 (Mum)

Power to call for documents.

9.11 u/s.255(6) r.w.s 131 of the Act, the Tribunal has the power to call for documents relevant

for deciding the appeal. In Union of India vs. Sheo Shankar Sitaram 95 ITR 523 (All) at

the request of the assessee, the Tribunal directed the department to produce certain

records, which pertained to the assessment and penalty proceedings and the department’s

claim of privilege u/s.124 of the Evidence Act, was negatived by the Court.

Power to Award Cost.

9.12 With effect from 1-6-1999, sub-section 2B is inserted to Section 254, which gives the

discretion to the Tribunal to award cost in suitable cases if the facts so warrant. In ACIT

vs. Shanti Star Builders ITA No.9601/B/91 dated 30-6-1999, Bench ‘B’, Mumbai, the

Tribunal awarded cost of Rs.2,000/- for the inconvenience caused to the assessee. In that

case, the departmental counsel had sought for an adjournment though on earlier occasion

it was agreed that on the next date, the case would be argued. The assessee’s counsel had

come from Calcutta on both the occasions.( Also see Sushila Malge

www.itatonline.com)

No power to make protective order:

9.13 Though Assessing Officer can make protective assessment, it is not open for the Tribunal

to make a protective order Smt. Hemlata Agarwal vs. CIT 64 ITR 428 (All.)

10. EX-PARTE ORDER.

10.1 Rule 24 & 25 of the ITAT Rules, 1963, deals with procedure for hearing ex-parte by the

Tribunal. Proviso to rule 24 provides that when an appeal has been disposed off ex-parte

and the appellant appeals afterwards and satisfies the Tribunal that there was sufficient

cause for his non-appearance when the appeal was called out for hearing, the Tribunal

shall make an order setting aside the ex-parte order and restoring the appeal. If a notice is

sent to the Assessee by Registered Post, the postal authorities may send back the notice

stating that the assessee refused to accept or postal authorities may deliver to a person

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who is not authorised to receive. If on receiving the acknowledgement from postal

authorities, ex-parte order is passed, if an assessee files Affidavit and brings to the notice

of the Tribunal that he has not received or he has not been served the notice, the Tribunal

should restore the matter. In Meghji Kanji Patel vs. Kundanmal Chamanlal AIR 1968

Bom 387, the Hon’ble Bombay High Court held that where an affidavit is filed the same

has to be accepted. This view of the Bombay High Court is affirmed by the Supreme

Court in Puwada Venkateswara Rao vs. Chindamana Venkataka Ramana AIR 1976

SC 869, 871.

10.2 In CIT vs. Multiplan India (P.) Ltd. 38 ITD 320 (Del), the reference was filed by the

department. On the date of hearing neither the representative of department was present

nor an adjournment application was moved. The Tribunal passed the order after 5 days

dismissing the appeal as unadmitted. Against the order, the department filed reference

application to refer the matter to the High Court. Hon’ble Tribunal rejected the reference

application on the ground that the department should have made application for

restoration of appeal under rule 24 of the ITAT Rules, 1963, and observed that revenue

choose to add to the litigation for no justifiable reason, hence, no question of law arises.

10.3 However, the Tribunal did not considered the ratio laid down by the Supreme Court in

CIT vs. Chennaiappa Mudaliar 74 ITR 41 (SC), wherein the court held that the Tribunal

must decide the case on merit and cannot dismiss it on non-appearance of the appellant,

hence judgement in Multiplan requires reconsideration. Also refer Jaipur Mineral

Development Syndicate vs. CIT 106 ITR 653 (SC).

Applications made for restoration of appeals which are dismissed ex-parte on account of

non-appearance, desire to be liberally construed.

Rainbow Agri Ind. Ltd. vs. ITAT (2004) 266 ITR 39 (Bom)

10.4 It has been observed in large number of cases, that matters have been disposed off by

applying the decision of Multiplan India and thereafter when an assessee makes an

application for restoration of the matter under rule 24 of the ITAT Rules, 1963, the

appeal is restored. Thus, it increases multiplicity of litigation. Matters come up for

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hearing after approximately 5 years from the date of filing of the appeal, hence, it is quite

possible that the assessee may have changed his address. Hence, in such cases, before

passing ex-parte order, it is better if the notice is served through the Assessing Officer

which would save lot of time and unintended paper work.

10.5 Since the Tribunal fees has been increased to a maximum of Rs.10,000/-, it could not be

said that the assessee has no interest in pursuing the appeal and hence, pass an ex-parte

order applying the ratio of Multiplan India. At least where the assessee has filed

Vakalatnama / Authority Letter of his representative, before passing an ex-parte order, it

would be justified if a notice is sent to the representative of the assessee.

10.6 Duty of the Court is to decide correct interpretation of law, hence, it may not be desirable

to decide the issue which is an important question of law in an ex-parte order, however, if

it is inevitable, then the Tribunal may request any member of bar to help the court as

amicus curiae to help the Tribunal. In such situation, help of Bar Association may be

sought. If such system is developed, it may go a long way in building the confidence of

Institution in the mind of the public. Even ex-parte order should not lead to punishment to

an assessee who may not be in a position to engage a competent representative.

10.5 Tribunal should decide the appeal on merits rather dismissing on ground of non-

appearance of the party. Chemipol vs. UOI 244 ELT 497 (Bom)

Bharat Petroleum Corporation Ltd vs. ITAT (Bombay High Court)

Tribunal has no power to dismiss appeal for non-appearance of appellant.

It has to deal with the merits. An application for recall of an ex-parte

dismissal order is under s. 254(2) & must be filed within 4 years from the

date of the order. The Tribunal must permit “mentioning” of matters

Similarly Hon SC in Central Excise matter Held that CESTAT has to decide the matter

on merits . No power to dismiss the appeal for want of procecution even if assessee

cousel has not appeared.

Balaji Steel Re- Rolling mills V/s CCE (2014) 272 CTR 205 (SC)

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Procedure when assessee claims identical question of law is pending before the High

Court or Supreme Court – Sec. 158A

Titanor Components Ltd. vs. CIT 184 Taxman 10 Bom

11. DUTIES OF TRIBUNAL.

11.1 Tribunal being a final authority as far as facts is concerned, the Tribunal has to consider

and decide all issues that are brought before it. It cannot decide only one issuing arising

out of many issues and decline to go into the other issues raised before it on the ground

that further issues will not arise in view of the finding on the issue decided by it. If the

Tribunal declines to consider and decide the other issues, it will only protract and delay

the proceedings, for the assessee has to get the decision of the Tribunal on the initial

point set aside by approaching the High Court. And thereafter again go before the

Tribunal for a decision on other issues left undecided by it earlier. This will amount to

multiplication of the proceedings under the Act. It is desirable that the Tribunal should

avoid disposing of the matters on preliminary issues alone, without deciding all the issues

raised before it. It should as far as possible give its view on all the points raised before it

so that the High Courts have the benefit of its decision on other points also, if necessary -

CIT vs. Ramdas Pharmacy 77 ITR 276, 291 (Mad.); Udhavdas Kewalram vs. CIT 66

ITR 462(SC).

8.1 Tribunal being a final authority as far as facts is concerned, the Tribunal has to consider

and decide all issues that are brought before it and pass reasoned order / speaking order .

The Order should be passed within 3 month from date of hearing. Shiv Sagar

Veg Restaurant vs. ACIT 317 ITR 433 (Bom)

8.2 A concession of law made by an assessee or his authorized representative is not binding.

CIT vs. Archana R. Dhanwatory (1982) 136 ITR 355 (Bom)

ITO vs. Estate of Late K.S. Engineer (2001) 70 TTJ 161 (Mum)

WRONG CONCESSION MADE BY A COUNSEL BEFORE THE COURT CANNOT BIND THE PARTIES. 1 WOI & Anr vs. S.C. Parashar (2006) 3 SCC 167

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2. P. Nallammal & Anr. Vs. State by Inspector of Police. (1999) 6 SCC 559

3. As regards the legal issues are concerned, assuming the assessee agrees for addition, the

same is not binding on him - Gauri Sahai Ghisa Ram v. CIT120ITR 338 (All) 4 -Rani

Anand Kunwar v. CIT 8 ITR 126 (Oudh). This is for the reason that there is no concession

on law.

11.2 Tribunal should pass reasoned order / speaking order

- Manibyrabha vs. CIT (2004) 265 ITR 560 (Ker)

- CIT vs. Bright Auto Motive & Placties Ltd. 280 ITR 157

- Shiv sagar veg restaurant v/s. Asst CIT 317 ITR 433 BOM

11.3 The Tribunal is under a duty to decide all questions of fact and law raised in the appeal

before it; for the purpose it must consider whether on the materials relied upon by the

assessee his plea is made out. The Tribunal cannot make arbitrary decisions; it cannot

find its judgments on conjectures, surmises or speculation. Between the claims of the

public revenue and of the taxpayers, Tribunal must maintain a judicial balance – Esthuri

Aswathiah vs. CIT 66 ITR 478 (SC); Omar Salay Mohamed Asit vs. CIT 37 ITR 151

(SC).

11.5 Order should be pronounced in open court.

CIT vs. Sudhir Choudhrie (2005) 278 ITR 490 (Del.)

13. BINDING NATURE OF HIGH COURT JUDGEMENTS

Doctrine of binding precedent:

The doctrine of binding precedent has merit of promoting certainty and consistency in

judicial decisions and enables an organic development of law ‘besides providing

assurance to an individual as to the consequence of transaction, forming part of his daily

affairs.

UOI vs. Raghubir sing 178 ITR 548 (SC)

13.1 As per the doctrine of precedent, all lower Courts, Tribunals and authorities exercising

judicial or quasi-judicial functions are bound by the decisions of the High Court within

whose territorial jurisdiction these Courts, Tribunals & authorities functions.

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13.2 Tribunals functioning within jurisdiction of a particular High Court are bound to follow

the decision of the jurisdiction High Court - State of AP v. Commercial Tax Officer 169

ITR 565 (AP); CIT vs. Deepak Family Trust No.1 211 ITR 575 (Guj.).

13.3 ITO is bound to follow the decision of Supreme Court as also by the decision of High

Court of the State within whose jurisdiction he is functioning - K. Subramanium ITO v.

Siemen India Ltd. 156 ITR 11 (Bom); CIT vs. G. Dalabhai & Co. 226 ITR 922 (Guj.).

13.4 Tribunal not applying decision of High Court of same Jurisdiction. Order of Tribunal

was erroneous - Shri Mahabir Industries v. CIT 220 ITR 459 (Gauhati); Air

Conditioning Specialists Pvt. Ltd. vs. Union of India 221 ITR 739 (Guj.).

13.5 As per the doctrine of precedent, all lower Courts, Tribunals and authorities exercising

judicial or quasi-judicial functions are bound by the decisions of the High Court within

whose territorial jurisdiction these Courts, Tribunals & authorities functions.

CIT vs. Thana Electricity Supply Ltd. (1994) 206 ITR 727 (Bom)

Consolidated Pneumatic Tool Co. (India) Ltd. vs. CIT (1994) 209 ITR 277 (Bom)

Mercedeze Benz v/s UOI 2010 (252) ELT 168 Bom.

13.6 (a) Yucca Finvest P. Ltd. 285 ITR 198 (Mum)

Unless a contrary decision is given by the jurisdictional High Court which is binding on

the Tribunal, it should respect the law laid down by another High Court. However the

same is not binding.

b) Tribunal is duty bound to follow the decision of a High Court, if there is no

contrary decision available from any other High Court Maharashtra State Warehousing

Corp. Ltd. vs. Dy. CIT (2009) 122 TTJ 865 (Pune)

c) If the revenue has not challenged the correctness of the law laid down by the High

Court and has accepted it in the case of one assessee then it is not open to the Revenue to

challenge its correctness in the case of other assessee without just cause.

UOI vs. Satish Panalal 249 ITR 221 (SC) ;

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UOI vs. Kaumudini N. Dalal 249 ITR 219 (SC)

CIT v/s. J. K. Charitable trust (2008) 308 ITR 161 (SC)

BINDING NATURE OF ORDER OF ONE BENCH OF TRIBUNAL ON ANOTHER

BENCH.

14.1 For the sake of uniformity, one Bench of the Tribunal is bound to follow the view

expressed by another Bench of the Tribunal unless the earlier view is per incurious - CIT

v. L.G. Ramamurthi 110 ITR 453 (Mad) ; CIT v. S. Devaraj 73 ITR 1 (Mad).

14.2 Tribunal should not come to a conclusion totally contradictory to the conclusion reached

by the earlier Bench of the Tribunal. Where a Bench differs from an earlier Bench, the

matter should be referred to a larger Bench - CIT v. Goodlass Nerolac Paints Ltd. 188

ITR 1 (Bom). UOI vs. Paras Laminates Pvt. Ltd. (1990) 186 ITR 722 (SC)

Pradip Chandra Parija vs. Pramod Chandra Patniak (2002) 254 ITR 99 (SC)

14.3 a) 2006 (10) SOT 1 Dy. CIT vs Padam Prakash (HUF)

Special Bench decision of three members should have precedence over Third Member

decision.

b) Oman International Bank 286 ITR 8 (AT)(SB)

Third Member decision is like the decision of Special Bench should be followed in same

manner.

C ) Despite Stay by High Court, Special Bench verdict is binding on the ITAT . CIT

v/s. Janapriya Engineers Syndicate (2015) 113 DTR 311 (AP) HC.

15. BINDING NATURE OF ORDERS OF TRIBUNAL

15.1 The First Appellate Authority or the Assessing Officer are bound by the orders of the

Tribunal. Even where the assessee or the department has pursued the matter in

reference proceedings, it does not act as a kind of stay of operation of the order of the

Tribunal.

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15.2 The Assessing Officer cannot ignore the decision taken by the Tribunal in favour of the

assessee and take a contrary view - ITO v. Siemens India Ltd. & another 156 ITR 11

(Bom). Bank of Baroda vs. H.C. Shrivastava (2002) 256 ITR 385 (Bom).

15.3 The Assessing Officer cannot refuse to follow the order passed by the Commissioner

against the application u/s.132(11) on the ground that the Commissioner had no

jurisdiction over the matter - Union of India v. Pradip Kumar Saraf & Others 207 ITR

679 (Cal), Sree Rajindra Mills Ltd. v. CIT (1970) 28 STC 483, Union of India v.

Kamlakshi Finance Corpn. Ltd. 1992 AIR SC 711 (712).

15.4 Finding of CESTAT binding on I.T.

CIT vs. Prince Gutka Ld. 312 ITR 341 (St.)

Miscellaneous Application before Appellate Tribunal

1. Rule

Rule 34A of the Appellate Tribunal Rules 1963 which was inserted w.e.f 25th July 1991

provides for the procedure for dealing with applications under Section 254(2

1.2 As per Section 254(2), the Tribunal is empowered to rectify within a period of four years

from the date of the order passed by the Tribunal u/s. 254(1), any mistake which is

apparent from the record either suo-motu or on an application. Application for

rectification to be made within 4 yrs from the date of the order to be rectified. Delay

cannot be condoned.

Arvindbhai H. Shah vs. Asstt. CIT (2004) 270 ITR 125 (AT) (Ahm)(SB)

Rahul Jee and Co. P. Ltd. vs. Astt. CIT (2009) 310 ITR 255 (Del.)(AT)

1.3 In CIT v. Ramesh Electric & Trading Co. 203 ITR 497 (Bom), it has been held that only

mistake apparent from record can be rectified. Failure of Tribunal to consider arguments

is not a mistake apparent from record, which can be rectified.

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2. Hearing

The Full Bench of the Delhi High Court in Smart Pvt. Ltd. vs ITAT (1990) 182 ITR 384

took the view that although there was no specific provision for dealing with an application

under Section 254(2) the rules of natural justice would require that both parties be heard

before disposing of the application.

The Hon’ble Bombay High Court in the case of Jain Trading Co. vs. UOI 282 ITR 640

(Bom) has held that the assessee should be heard prior to disposal of the application

u/s. 254(2).

3. Tribunal cannot rehear the appeal u/s. 254(2) Mahesh Bery vs. Astt. CIT 317 ITR 110

(Kol.)(AT)

4. Review : No power of Review

There is no doubt that the power of review is not an inherent power but must be conferred

by law either specifically or by necessary implication. (See Patel Thackersy vs.

Pradyumansinghji Arjunshingji AIR 1970 SC 1273).

5. Illustrations

A. Order rejecting Miscellaneous

Application cannot be rectified.

CIT vs. ITAT (1992) 196 ITR 838

(Oris)

76 TTJ 224 – Shristhi Pal vs. ITO

B. Order contrary to pronouncement

constitutes mistake apparent on the

record.

A decision which is rendered contrary

to a pronouncement made in open court

would constitute a mistake rectifiable.

CIT vs. G. Sagar Suri & Sons (1990)

185 ITR 484 (Del).

C. Order made under misconception

or misapprehension rectifiable.

Maharaja Martant Singh Ju Deo vs.

CIT (1988) 171 ITR 586 (MP)

D. Failure to consider preliminary

objection or deal with a ground of

appeal rectifiable.

Laxmi Electronic Corporation Ltd. vs.

CIT (1991) 188 ITR 398 (All)

CIT vs. Keshav Fruit Mart (1993) 199

ITR 771 and ITO vs. ITAT (1965) 58

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ITR 634

E. Failure to consider alternative

argument rectifiable.

CIT vs. ITAT (1988) 172 ITR 158 (MP)

F. Failure to consider material on

record rectifiable.

CIT vs. Mithalal Ashokkumar (1986)

158 ITR 755

G.

Order passed on erroneous

assumptions rectifiable.

CIT vs. Shakuntala Rajeshwar (1986)

160 ITR 840 (Del)

H.

Order based on a decision

subsequently reversed rectifiable.

Kil Kotagiri Tea and Coffee Estates

Company Ltd. vs. ITAT (1988) 174 ITR

579

I. Subsequent decision of Supreme

Court, High Court if directly on

point rectifiable

a) Nav Nirman P. Ltd. vs. CIT

174 ITR 574 (MP)

b) CIT vs. Smt. Aruna Luthra

252 ITR 76(P&H) (FB)

c) Motilal Padampat Udyog Ltd. vs.

CIT, 186 ITR 180 (Bom)

d) Poothundu Plantations P. Ltd. vs.

ITO (1996) 221 ITR 557 (SC)

e) CBDT Circular No. 68

Dt. 17/11/1971

J.

Non-consideration of relevant

provision of law rectifiable.

Non consideration of a provision of

law which would have material bearing

on the decision is a glaring obvious and

self-evident mistake apparent from the

record. Such a mistake would be

required to be corrected (CIT vs. Quilon

Marine Produce Co. (1986) 157 ITR

448). Modu Finblo vs. 1st WTO (1995)

53 ITD 53 (Pune) (TM) ITO vs. Gilard

Electronics (1986) 18 ITD 176 (JP),

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ACIT vs. Sornamy Alkington Ltd.

(1994) 49 ITD 207 (Delhi).

K. Decisions not cited referred to in

order.

Lakhmini Mewal Das vs. ITO (1972) 84

ITR 649. (Cal.)

L. Order can be amended in the light

of retrospective amendment.

M. K. Venkatachalam vs. Bombay

Dyeing and Mfg. Co. Ltd. (1958) 34

ITR 143 that an amendment with

retrospective effect would require an

amendment and rectification

consequent to the retrospective

amendment. See also CIT vs. Eva Raha

(1980) 121 ITR 293 (Gau); CIT vs.

Kelvin Jute Co. Ltd. (1980) 126 ITR

679 (Cal.) Even if a reference has been

made ITO vs. Homi Mehta & Sons (P)

Ltd. (1985) 14 ITD 64 (Bom).

M. Srinivasalu vs. UOI 239 ITR 282

(Kar)

M. Failure to consider argument

advanced not an error apparent on

the record.

CIT vs. Ramesh Electric and Trading

Co. (1993) 203 ITR 497 (Bom) the

question arose as to whether the non

consideration of an argument

constitutes a mistake apparent on the

record. The Bombay High Court held

that such non-consideration would be

an error of judgement but not an error

apparent on record.

The Bombay High Court in

Khushalchand B. Daga vs. ITO (1972)

85 ITR 48 has endorsed the principle

that a Tribunal has an inherent

jurisdiction to rectify a wrong

committed by itself when that wrong

causes prejudice to a party for which

that party was not responsible.

Unfortunately the High Courts attention

had not been drawn to Daga’s case in

Ramesh Electric (Supra).

N. Absence of reasoning no ground

for rectification

248 ITR 577 (P&H) - Popula

Engieneering Co. vs. ITAT – Absence

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of adequate reasons in an order passed

u/s 254(1) cannot per se be regarded as

a mistake apparent within the meaning

of 254(2).

However various courts have

repeatedly held that the Tribunal must

pass a speaking order dealing with each

issue and grant relief after applying

provision of law.

Shahid Atiq 97 ITD 22(Del.)

CIT vs. Simplex 282 ITR 542 (MP)

Vipul Fashion P. Ltd. vs. Astt. CIT

284 ITR 332 (Guj.)

O. Violation of natural justice ground

for rectification

257 ITR 440 (Raj) – CIT vs. S.S.Gupta

–

P.

Appeal decided without

considering pending application

rectifiable.

179 CTR 265 (SC) – Jyotsna Suri vs.

ITAT

Q.

Reliance on wrong section, order

rectifiable.

261 ITR 49 (Del) – Seth Madanlal

Modi vs. CIT

Also see 267 ITR 450 (Mad) Prithviraj

Chohan vs.. CIT.

R. Non consideration of decision

cited of Co-ordinate Bench

Honda Siel Power Products Ltd. vs.

CIT (2007) 295 ITR 466 (SC)

Tribunal passing order without

considering decision of Supreme

Court / High Court is mistake

which can be rectified.

F.F.E Mineral (I) P. Ltd. vs. Jt. CIT

84TTJ 907 (Chen.)

Mohan Meakin Ltd. vs. ITO 89 ITD

179 (Del.)(TM)

Himachal Pradesh Financial Corp. vs.

CIT 233 ITR 450 (MP)

- ACIT vs. Saurashtra Kutch Stock

Exchange Ltd. (2008) 305 ITR 227

(SC)

In rectification proceeding u/s. 254(2) Tribunal cannot look into Merits of the case.

CIT vs. Eamesh Exports Ltd. Appeal No. 26 of 2010 dt. 25/2/2001.

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Non Consideration of decision citied of the Co-ordinate Bench

Honda Siel Power Products Ltd. vs. CIT (2007) 295 ITR 466 (SC)

ACIT vs. Saurashtra Kutch Stock Exchange Ltd. (2008) 305 ITR 227 (SC)

Failure to apply judgement of jurisdictional High Court .

State Bank of India vs. DCIT (Bombay High Court)

S. 254(2): If the Tribunal accepts that a mistake has crept in the order, interests of justice is

served if the entire order is recalled (suo moto by the ITAT) & appeal re-heard. Appeals

should not be disposed off in “light hearted” and “casual manner”

We are not happy in the manner in which the Tribunal has decided the Miscellaneous

Application. If the Tribunal was required to devote so much time for assigning reasons in

more than five paragraphs in a lengthy eight page order on the Miscellaneous

Application so as to correct an obvious mistake by exercising powers under section

254(2) of the IT Act, then, interest of justice would have been sub-served and better had

the Tribunal revived the entire Appeal and not partially. If there was a mistake with

regard to the claim of deduction, we do not think that the tribunal was justified in

directing partial revival of the Appeal…… We do not think that interest of justice and

equity is served by non consideration of vital materials by the last fact finding authority,

namely the Income Tax Appellate Tribunal. That the Tribunal was required to recall its

earlier orders and for the reasons which have been assigned by it would indicate that it

failed to apply its mind at the initial stage to the grounds raised in the Appeal and in their

entirety. It omitted from consideration crucial documentary material as well. In such

circumstances, such partial revival of the Appeal would not meet the ends of justice.

ART OF REPRESENTATION

1.1 The art of representation is nothing but art of communication or rather the art of

persuasion. You must be able to convince the deciding authority that it is so.

The art of representation is not confined only to court, but any where in life, in any

forum. The art of representation involves some degree of advocacy.

Advocacy is about persuading people, you cannot go through life without, on occasion

needing to persuade. Advocacy is often useful and vital, in negotiation, in meetings and

public lectures. If you do not practice law at all, principles of advocacy is still a valuable

skill, a transferable skill, a life long skill.

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1.2 Elements of persuasion

The task is threefold:

a) to be heard; to be interesting; to engage the audience in the presentation;

b) to get the message across; to select the right content and to emphasise the key

points; and

c) to persuade the audience to accept the view advocated.

Presentation skills are the key to persuasion because presentation carries the message.

1.3 SOME IMPORTANT PRINCIPLE OF GOOD REPRESENTATION:

A. There is no substitute for hard work. One must master the facts and read the law on the

subject.

B. Adhere to dress code and file your letter authority in advance.

C. Observe Decorum in the court.

D. In the opening argument put forth the best points which cannot be disputed and carry the

judge with you.

E. While arguing one must narate the fact chronologically before the court, one may take

assistance of the paper book which is filed. One must avoid unnecessary and irrelevant

papers in the paper book. Thereafter one should proceed to state the submissions and

thereafter support the same with relevant case law.

F. You must know the Judge mind while you are arguing and tactfully you must put your

points.

G. When the Judge is making a point it is always advisable to listen carefully understand his

view point and then reply.

H. One should keep a smile on his face and should have a good sense of humour. One must

have common sense in a good measure.

I. Do not interrupt the Judge repeatedly, his ego is hurt. It is not advisable to rub the

Judge’s psychology. One has to be fair to the Judge as well as other side. You must never

be unfair to your opponent.

J. You must remember that every man has his ego and when one is sitting on the judicial

chair, the ego becomes still more important and that has to be respected.

K. One must never lose the temper in the court;

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L. You cannot win all the cases and one should not get over identified with the client or the

case.

M. One should not insist on displaying one’s oratorical skill or his knowledge, which would

not be relevant for the court. One should know when to stop.

N. Build the Reputation

1.4 Edward Abbott Parry, an eminent English Judge in his book captioned “Seven Lamps of

Advocacy” published by T. Fisher Unwin Ltd., Fourth Impression 1926, has highlighted

seven important attributes of a successful lawyer or seven lamps, which enlighten his

future path as a professional for effectively pursuing legal profession before courts.

These seven lamps have been enumerated by the author as under:

1. The Lamp of Honesty;

2. The Lamp of Courage;

3. The Lamp of Industry;

4. The Lamp of Wit;

5. The Lamp of Eloquence;

6. The Lamp of Judgement; and

7. The Lamp of Fellowship.

Thank you

JAI HIND

Ajay R. Singh

Advocate Mob. No. 9892212125

Email: ajaysingh.legal@gmail.com