COMMISSIONER OF INCOME TAX (EXEMPTIONS) vs. D. L. ASHISH FOUNDATION TRUST, JATIN JANI

Heard learned Senior Standing Counsel Mrs. Mauna M. Bhatt for the appellant i.e. The Commissioner of Income Tax (Exemptions), Ahmedabad.

By way of present Tax Appeal filed under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as 'the said Act'), the appellant has sought to challenge the impugned order dated 29.12.2020 passed by the Appellate Tribunal, “A” Bench, Ahmedabad by suggesting to frame following substantial question of law : - “Whether on the facts and circumstances of the case and in law, the Appellate Tribunal is justified in setting aside the C/TAXAP/149/2021 ORDER DATED: 10/06/2021 assessment order and directing to pass de novo assessment without appreciating that the assessee failed to comply despite having been given ample opportunities during the course of assessment proceedings as well appellate proceedings ?”

Having heard learned Senior Standing Counsel Mrs. Mauna M. Bhatt for the appellant and having gone through the impugned order passed by the Tribunal, it appears that the Appellate Tribunal has given one more opportunity to the respondent – assessee by remanding the matter to the Assessing Officer for the de novo assessment keeping all the issues open before the Assessing Officer without any fetters.

The Court does not find any question much less substantial question of law being involved in the present Appeal, though it was sought to be submitted by the learned Senior Standing Counsel that the respondent – assessee had failed to appear before the Assessing Officer earlier though number of opportunities were granted to him. It may be noted that the Appeal under Section 260A could be admitted only on the High Court being satisfied that the case involves a substantial question of law. The Supreme Court in the case of M. Janardhana Rao versus Joint Commissioner of Income Tax reported in (2005) 2 SCC 324, while dealing with the scope of Section 260A of the Income Tax Act, 1961, observed as under : - C/TAXAP/149/2021 ORDER DATED: 10/06/2021 “14. Without insisting on the statement of substantial question of law in the memorandum of appeal and formulating the same at the time of admission, the High Court is not empowered to generally decide the appeal under Section 260A without adhering to the procedure prescribed under Section 260A. Further, the High Court must make every effort to distinguish between a question of law and a substantial question of law. In exercise of powers under Section 260A, the findings of fact of the Tribunal cannot be disturbed. It has to be kept in mind that the right of appeal is neither a natural nor an inherent right attached to the litigation. Being a substantive statutory right, it has to be regulated in accordance with law in force at the relevant time. The conditions mentioned in Section 260A must be strictly fulfilled before an appeal can be maintained under Section 260A. Such appeal cannot be decided on merely equitable grounds.

An appeal under Section 260A can be only in respect of a 'substantial question of law'. The expression 'substantial question of law' has not been defined anywhere in the statute. But it has acquired a definite connotation through various judicial pronouncements. In Sir Chunilal V. Mehta & Sons Ltd. v. Century Spinning & Mfg. Co. Ltd., AIR (1962) SC 1314, this court laid down the following tests to determine whether a substantial question of law is involved. The tests are: (1) whether directly or indirectly it affects substantial rights of the parties, or (2) the question is of general public importance, or (3) whether it is an open question in the sense that issue is not settled by pronouncement of this Court or Privy Council or by the Federal Court, or (4) the issue is not free from difficulty, and (5) it calls for a discussion for C/TAXAP/149/2021 ORDER DATED: 10/06/2021 alternative view. There is no scope for interference by the High Court with a finding recorded when such finding could be treated to be a finding of fact.

The learned advocate Mrs. Bhatt having failed to point out any question of law much less substantial question of law being involved in the present appeal, the same deserves to be dismissed and is accordingly dismissed. It is clarified that the Court has not gone into the merits of the case. (BELA M. TRIVEDI, J) (A. C. JOSHI,J) AMAR SINGH