Kerala High Court
Cit vs N.T. A. Kareem on 27 February, 2001
Equivalent citations: (2001)167CTR(KER)280
JUDGMENT S. Sankarasubhban, J.
In both the cases the question of law raised is as follows :
"Whether, on the facts and in the circumstances of the case, and also in the light of the answer to the question in the quantum reference, the Tribunal is right in law and fact in setting aside the order of the Commissioner (Appeals)?"
The Tribunal, Cochin was dealing with ITA Nos. 21 and 969/Coch/of 1990, both by the same appellant. Instead of deciding the appeals on merits, the Tribunal held as follows : "We have thus heard rival submissions. Avoidance of vexatious and protracted litigation will by itself further the cause of justice and reduce the burden of arrears in courts of law. Keeping this end in view and having regard to the submissions made before us, we set aside the order of the Commissioner (Appeals) and restore the issues to the file of the assessing officer to enable the assessee to approach the Settlement Commission for settlement of the outstanding disputes, without prejudice to the right of either party to revive the appeal in case the petition for settlement is rejected by the Settlement Commission".
2. We are of the view that, this approach of the Tribunal is wrong. The Tribunal has to decide the appeal in one way or the other. If the parties want to approach the Settlement Commission, they may withdraw the appeal. The Tribunal is not a court. But the powers of the Tribunal in dealing with appeals are expressed in the widest possible terms, and are similar to the powers of an appellate court under the Civil Procedure Code. This section provides that the Tribunal may, after giving both parties to the appeal an opportunity of being heard, "pass such orders thereon as it thinks fit". The word "thereon" restricts the jurisdiction of the Tribunal to the subject-matter of the appeal, and the subject matter of the appeal is constituted by the original grounds of appeal and such additional grounds as may be raised by leave of the Tribunal. The power to pass such orders as the Tribunal thinks fit can be exercised only in relation to the matters that arise in the appeal. It is not open to the Tribunal to adjudicate or give a finding on a question which is not in dispute and which does not form the subject-matter of the appeal (vide Kanga and Palldwala on Income Tax Act, 5th Edn.).
3. In the result, the question of law is answered in the negative and against the assessee, and in favour of the department. The income-tax references are disposed of as above.