Income Tax Appellate Tribunal - Indore
Pawan Kumar Ladha vs Assistant Commissioner Of Income Tax on 18 December, 2001
Equivalent citations: [2003]84ITD178(INDORE), (2003)78TTJ(INDORE)983
ORDER
I.C. Sudhir, J.M.
1. The assessee has impugned the block assessment on several grounds. At the outset of the hearing of the appeal, the learned Senior Departmental Representative has, however, raised a preliminary objection on the maintainability of the very appeal on the basis that in view of the provisions of Section 249(4)(a) of the Act, the assessee has not paid the admitted tax before filing the present appeal. He draws our attention to the letter dt. 19th Oct., 2001, of the office of the Dy. GIT (erstwhile). Investigation, Circle-I, Indore, whereby he has been informed that only Rs. 22,63,600 have been paid before filing of the present appeal by the assessee out of Rs. 26,47,800 i.e. the tax payable as per the block return. This fact has not been denied by the learned authorised representative of the assessee. He, however, opposes the objection on the basis that Section 249(4) of the Act cannot be read in isolation of Chapter XX-A and the present appeal has been filed under Section 253(1) of the Act which falls under Chapter XX-B. Therefore, the provisions of Section 249(4)(a) of the Act falling under Chapter XX-A of the Act are not applicable to the appeals filed before the Tribunal, submits the learned authorised representative. In the alternative, he submits that the assessee is ready to make the balance payment if it is so directed by the Tribunal. He draws our attention to the applications addressed to the authorities concerned to release the seized hundies worth around Rs. 40 lakhs to the assessee. The further contention of the learned authorised representative is that the assessee is a hundi broker and since the hundies worth Rs. 40 lakhs were seized by the Revenue, he was not in a position to make the payment of the entire outstanding of the demand before filing of the present appeal.
2. In rejoinder to the reply of the learned authorised representative, the learned Senior Departmental Representative draws our attention to the contents of p. 7631 of the book entitled "Income-tax Law" authored by Chaturvedi and Pithisaria and cites the decision of the Chennai Bench of the Tribunal in the case of V. Bhaskaran v. Asstt. CIT (1998) 62 TTJ (Chennai) 698.
3. Since the preliminary objection raised by the learned Senior Departmental Representative relates to the very maintainability of the present appeal, we are of the opinion that it would be proper to decide the same first before proceeding further to hear the appeal on merits. Thus, the issue before us at this stage is as to whether the provisions of Sub-clause (a) of Sub-section (4) of Section 249 under heading 'A' of Chapter XX of the Act are also applicable to the appeals to be filed before the Tribunal.
4. We have considered the rival submissions of the parties carefully and have gone through the decisions relied upon by them. The learned Senior Departmental Representative has heavily relied upon the order of the Chennai Bench of the Tribunal in the case of V. Bhaskaian (supra) wherein the issue has been decided in favour of the Revenue. The Chennai Bench of the Tribunal in this case has justified its conclusion mainly on the basis that the word "Chapter" in Sub-section (4) of Section 249 has been used deliberately and with some set purpose and intended by the legislature, namely, to compel an assessee to pay the tax on the admitted return in order to get the right or benefit of appeal exercisable before the appellate authorities, that being the true and real intention of the legislature, there is no reason why the same cannot be made applicable to the appeals being filed before the Tribunal under Section 253 of the Act and since the legislature has mandated under Section 249(4) that no appeal shall be admitted unless tax on the returned income is paid before filing of the appeal, clearly conveys the meaning that the provisions even apply to appeals before the Tribunal which are required to be filed in accordance with the provisions of Section 253 of the Act. We, however, having gone through the entire provisions of Section 249(4) of the Act could not be able to convince ourselves that the word "Chapter" in Sub-section (4) of Section 249 would cover both the Chapters i.e. XX-A and XX-B, the reason being that the proviso to Section 249(4) wherein CIT(A) with good and sufficient reasons to be recorded in writing has been empowered to exempt the assessee from the operation of Clause (b) of Section 249(4) of the Act. If the word 'Chapter' mentioned in Sub-section (4) of Section 249 was to be intended by the legislature to include both the headings 'A' and 'B' under Chapter XX, the word 'appellate authority' would have been more appropriate to be used by the legislature in place of the words "CIT(A)" in the proviso to Section 249(4). For ready reference, Sub-section (4) of Section 249 of the Act is reproduced hereunder :
"(4) No appeal under this Chapter shall be admitted unless at the time of filing of the appeal.--
(a) where a return has been filed by the assessee, the assessee has paid the tax due on the income returned by him; or
(b) where no return has been filed by the assessee, the assessee has paid an amount equal to the amount of advance-tax which was payable by him :
Provided that, in case falling under Clause (b) and on an application made by the appellant in this behalf, the CIT(A) may, for any good and sufficient reason to be recorded in writing, exempt him from the operation of the provisions of that clause."
Furthermore, the entire Chapter XX has been divided in six main headings like, A, B, C, D, E and F, wherein heading 'A' is worded as "Appeals to the Dy. C1T(A) and CIT(A)" comprising of Sections 246 to 251. Similarly, heading 'B' is worded as "Appeals to the Tribunal" comprising Sections 252 to 255. Likewise, headings C to F deal with reference, appeals to the High Court and appeals to the Supreme Court, revision by the CIT and general, respectively. Thus, a common inference is drawn that Sections 246 to 251 under heading 'A' of the Chapter deal with appeals to the Dy. CIT(A) and CIT(A) while Sections 252 to 255 under heading 'B' deal with appeals to the Tribunal. Of course Chapter XX is worded as "Appeals and Revision". Here we are concerned with the headings 'A' and 'B' only of Chapter XX. We do not find much help on the issue herein from the contents of p. 7631 of the book entitled "Income-tax Law" authored by Chaturvedi and Pithisaria, as therein the emphasis is on as to whether it is mandatory to pay the admitted tax in the return by the assessee before preferring an appeal. It is nowhere discussed therein as to whether it is mandatory to pay the admitted tax before filing of the appeal by the assessee to the Tribunal. A plain reading of the wordings of Sub-section (4) of Section 249 including the proviso thereto suggests that in the case falling under Sub-clause (a) of Section 249(4) it is mandatory for the assessee to pay tax due on the income returned by him before preferring an appeal, otherwise appeal would not be admitted. No such provision is there under the heading 'B'--appeals to the Tribunal. We are of the view that perhaps the legislature while framing different headings under Chapter XX especially 'A' and 'B' would have in his mind that generally second appeals are preferred before the Tribunal and whatever tax on the income returned by the assessee is there, must be paid at the stage of appeal before the first appellate authority i.e. Dy. CIT(A) and CIT(A) itself and perhaps it might have escaped from their consideration that there is some exception to this general provision that some types of appeals are filed by the assessee directly to the Tribunal as first appeal and on the other hand this possibility is also there that the legislature do not intend to put such condition of paying the admitted tax in the return on the assessee before moving the Tribunal in appeal for the first time. But here our jurisdiction is limited and restricted to the wordings of the provisions under the Act only. We are not supposed to fill up lacunae, if any, in the statutory provisions. The principles of 'harmonious constructions' are applicable where wordings of law is ambiguous and it carries more than one meaning. Thus, taking outside assistance, like history behind its framing, its aims and objects, etc., etc., the judiciary opts its just and proper meaning in preference to the meaning leads in absurdity, which is not the case here.
5. After having carefully gone through the wordings of Chapter XX especially under the headings 'A' and 'B', we are of the definite view that there is no such mandatory condition under the heading 'B' like Sub-section (4)(a) of Section 249 under heading 'A' that an assessee must pay' the due tax admitted in its return before or at the time of filing of the appeal before the Tribunal. The Revenue would have certainly a case if in place of the wordings "Appeals to the Dy. CIT(A) and CIT(A)", the word, "first appellate authority" would have been mentioned with the heading 'A' or in the proviso to Sub-section (4) of Section 249 of the Act.
And furthermore, it appears from the contents of Form No. 35 issued under Rule 45 of the IT Rules, 1962 that there is a column wherein the assessee is required to give information as to whether the tax due on the income returned has been paid in full and if the answer is in the affirmative, to give details of date of payment and the amount paid. Form No. 35 is the proforma for filing appeal to the CIT(A) while Form No. 36 under Rule 47(1) of the IT Rules, 1962, is the form of appeal to the Tribunal. We, however, find that in Form No. 36 there is no such column or in other words no such information regarding payment of tax due on the income returned has been sought for from the assessee as in Form No. 35 for filing appeal to the CIT(A). This also supports our conclusion on the issue.
6. We thus find no substance in the preliminary objection raised by the learned Senior Departmental Representative and we decide the issue raised in the preliminary objection in negative i.e. against the Revenue and in favour of the assessee.
7. In view of our finding on the aforesaid preliminary objection, the registry is directed to fix this appeal for hearing on merits on any convenient date in the month of February, 2002.