COMMISSIONER OF INCOME TAX Vs. SHYAM SUNDER DHOOT

JUDGEMENT

(1.) FOR the asst. yr. 1979-80, the ITO passed an order of assessment. He estimated the net profit as Rs. 22,65,000 (Rupees twenty two lac and sixty five thousand only) on the estimated sale of Rs. 7.5 crores and took Rs. 1,50,000 (Rupees one lac and fifty thousand only), as initial investments. The order of the assessment was set aside in appeal by the CIT(A) and the matter was remanded to the ITO for fresh assessment with an observation that another opportunity be given to the assessee to cross-examine Ratan Lal. Against the remand order of the CIT(A), the assessee as well as the Revenue filed appeals before the Tribunal. IT Appeal No. 703/JP/83 filed by the assessee was allowed in part and ITA No. 717/JP/83 filed by the Department was dismissed vide order dt. 10th June, 1985. The order of the Tribunal dt. 10th June, 1985 was served on the Department on 20th June, 1985. It filed an application under S. 256(1) of the IT Act, 1961 in regard to its appeal No. 717/Jp/83 on 20th Aug., 1985 before the Tribunal seeking reference to be made to the High Court on questions No. 1, 2 and 3 mentioned therein, which runs as follows :

(2.) THEREAFTER an application for amendment of the said reference application was filed on 16th Dec., 1985 stating the following five questions of law to be referred to the High Court as arising out of both the appeals No. 703/Jp/83 and 717/Jp/83 :

(3.) THE submission of the learned counsel appearing on behalf of the Department appears to be sound but the ratio of law enunciated by the Division Bench in the case of Prem Agencies (supra) will not be applicable in the instant case because here the Revenue itself filed an application under s. 256(1) before the Tribunal praying for a reference instead of praying for quashing the remand order passed by the CIT(A). From the order of the Tribunal nowhere it appears that the case set up by the Revenue before it was confined only to examine the legality of the remand order. On the other hand, this point was given up and it wanted a decision on the reference application which has been done. Once the Revenue submitted to the jurisdiction of the Tribunal for getting a finding on the reference application and it having been decided against it, the order could not be challenged on the ground of jurisdiction. This is not one of those cases where there was inherent want of Tribunal's jurisdiction to decide the reference application. If the Revenue decided to get a finding on the reference application and not challenged the remand order it is not open for it to challenge the same held in reference under S. 256(2). Accordingly, we find no merit in the submission raised by the learned counsel appearing on behalf of the Revenue, and the application is hereby rejected.