TABLETS (INDIA) LTD. Vs. CIT

JUDGEMENT

(1.) THE present review applications are filed as against the judgment made in Tax Case (Appeal) Nos. 308, 309 and 1620 of 2005 dated 9 -1 -2012. The petitioner is a public limited company dealing in the manufacture of medicines. The relevant assessment years are 1995 -96, 1994 -95 and 1993 -94 respectively. For the assessment year 1994 -95, the corresponding accounting year ended on 31 -3 -1994. The assessee filed its return on 29 -11 -1994 disclosing the income of Rs. 24,71,905. The AO issued notice under section 143(2) of the IT Act and completed the assessment under section 143(3) of the Act and determined the total income at Rs. 72,44,250. In respect of assessment year 1995 -96, the corresponding accounting year ended on 31 -3 -1995. The AO, giving affect to the order of the CIT(A), completed the assessment under section 143(3) read with section 251 of the Act and determined the total income at Rs. 4,95,060. For the assessment year 1993 -94, the corresponding accounting year ended on 31 -3 -1993. The AO completed the original assessment on 29 -3 -1996 and later issued notice under section 148 of the Act on the ground that there was escapement of income within the meaning under section 148 of the Act. Reassessment was completed under section 143(3) read with section 147 of the Act and the AO determined the total income at Rs. 30,06,430. In all the above assessment years, the AO disallowed the assessees claim to the payment of commission made to (i) Rahul Enterprises, Chennai, and (ii) Rahul Steel Industries. Aggrieved by that order, the petitioner/assessee preferred appeals before the CIT(A), who allowed the appeals. Aggrieved by that order, the Revenue filed appeals before the Tribunal. The Tribunal, in respect of assessment years 1994 -95 and 1995 -96, has dismissed the Revenues appeal by common order and in respect of assessment year 1993 -94, on the ground that there is no material available on record to substantiate the claim, disallowed the commission payment and held against the assessee. In respect of the assessment years 1994 -95 and 1995 -96, the Revenue filed appeals under section 260A of the Act in Tax Case (Appeal) Nos. 308 and 309 of 2005 before this Court and when the matter was taken up, this Court admitted the appeals on 7 -12 -2005 on the following substantial question of law:

(2.) WHETHER , on the facts and in the circumstances of the case, the Tribunal is right in law in holding that the payments made by the appellant to its employees and other firms are not wholly and exclusively for the purpose of its business?

(3.) HEARD the learned counsel appearing on either side and perused the documents available on record. It is pertinent to note that the issue raised now was not at all raised in the tax case appeals. Further it is seen that the questions of law raised by the petitioner/assessee in the tax case appeals are related to the payment of commission. When the tax case appeals came up for admission, the said plea was not raised and, therefore, this Court admitted the appeals on the above stated substantial questions of law. We have gone through the tax case appeals. Even in the statement of facts, nothing was mentioned about the present controversy. The only issue raised in the tax case appeals relates to the disallowance to the payment of commission. Therefore, this Court considered the same and passed orders. Now the learned counsel appearing for the petitioner/assessee has stated in the Review Applications that the argument in respect of jurisdiction of the Tribunal was raised orally at the time of hearing. It is incorrect. The Court considered what was stated in the grounds of appeal and substantial questions of law raised and arguments advanced by the counsel. What was not raised was not considered. No oral argument was made at the time of hearing. The scope of review was considered by the apex Court in the case of S. Bagirathi Ammal v. Palani Roman Catholic Mission : (2008) 2 Law Weekly 537 (SC) and in para 5 the Supreme Court has considered Order XLVII, r. 1, CPC, and held as follows: