COMMISSIONER OF INCOME TAX Vs. M A UNNEERIKUTTY

JUDGEMENT

(1.) PURSUANT to the directions given in O. P. No. 6144 of 1991, the following question has been referred for the opinion of this court by the Income-tax Appellate Tribunal, Cochin Bench (in short, "the Tribunal"), under Section 256(2) of the Income-tax Act, 1961 (in short, "the Act") ;

(2.) THE factual position, so far as undisputed, is as follows : THE assessee is an individual deriving income mainly from business in purchase and sale of "copra". THE assessment for 1972-73 was completed on August 23, 1975, determining the total income of the assessee at Rs. 6,97,330. An addition on account of income from undisclosed sources was made, which, according to the Assessing Officer, represented unaccounted purchase of copra. THE Assessing Officer initiated proceedings under Section 271(1)(c) of the Act. As the minimum penalty leviable exceeded Rs. 25,000, the Assessing Officer referred the case to the Inspecting Assistant Commissioner of Income-tax (in short "the IAC") for disposal. THE Inspecting Assistant Commissioner by order dated July 26, 1979, imposed penalty of Rs. 3,25,845. THE assessee took the stand in appeal before the Tribunal that the order of penalty passed by the Inspecting Assistant Commissioner on July 26, 1979, was bad in law. In essence, the stand was that the order having been passed after the amendment made in the Act relating to jurisdiction with effect from April 1, 1976, the Inspecting Assistant Commissioner did not have jurisdiction to pass the order. THE Tribunal noticed that the penalty was leviable in respect of the following amounts :

(3.) IT is true that no litigant has any vested right in the matter of procedural law but, where the question is of change of forum, it ceases to be a question of procedure only. Forum of appeal or proceedings is a vested right as opposed to pure procedure to be followed before a particular forum. Right becomes vested when proceedings are initiated in the Tribunal or the court of first instance, and unless the Legislature has, by express words or by necessary implication, clearly so indicated, that vested right will continue in spite of change of jurisdiction of different Tribunals or forums. This view was expressed in Ramesh Singh v. Cinta Devi, 1996 2 SCR 1036 . Referring to the earlier decisions in Hoosein Kasam Dada (I.) Ltd. v. State of M. P., 1983 13 ELT 1277 ; State of Bombay v. Supreme General Films Exchange Ltd., 1960 3 SCR 640 and Vitthalbhai Naranbhai Patel v. CST, 1967 AIR(SC) 344 , it was observed that unless the new Act expressly or by necessary implication makes the provision applicable retrospectively, the right to appeal will crystallise in the appellant on the institution of the application in the Tribunal of first instance and that a vested right of appeal would not be dislodged by enactment of the new Act.