Addl. Commissioner Of Income Tax vs Anupam Fashion Palace
1984 Latest Caselaw 185 Del

JUDGMENT

D.K. Kapur, J.

1. The reference before us relates to a partnership firm, which was treated as an AOP for the asst. yr. 1968-69 on account of the fact that registration was refused to us is as follows :

"Whether, on the facts and in the circumstances of the case, the Tribunal was legally right in holding that the AAC was not justified in setting aside the order of the ITO by admitting fresh evidence without affording any opportunity to the ITO to scrutinise the evidence ?"

2. The question has arisen in the following manner. The registration was refused on the ground that the partnership was invalid, as Shri Prem Chand, one of the partners, was a minor on the date of the partnership, i.e. 18-10-1967. The ITO had asked for proof of the age of Shri Prem Chand by filing a certificate but an affidavit of Smt. Bhakhtawari Devi wife of Shri Girdhari Lal, mother of Shri Prem Chand, was filed showing that he was born in December, 1949. Accepting this affidavit, the ITO held that Shri Prem Chand was a minor and accordingly the registration was refused.

3. On appeal, an affidavit of Shri Girdhari Lal, father of Shri Prem Chand was filed stating that Shri Prem Chand was born on 9-1-1949. The AAC after considering this new evidence thought that he should set aside the order refusing registration and directed the ITO to go through the claim again after taking into consideration the fresh evidence. An appeal was taken to the Tribunal, who came to the conclusion that the procedure adopted by the AAC was not correct as the certificate of the N.D.M.C. together with the affidavit conclusively established the date of birth of Shri Prem Chand and as he was a major, there could be no doubt that the firm was genuine. So, the registration was granted. This has led to the reference.

4. The ld. counsel for the department contends that the AAC was right in giving an opportunity to the ITO to rebut the certificate as well as the affidavit showing that Sri Prem Chand was major and not a minor. In the sense that both the sides have to be given an opportunity, there can be no doubt that he ld. counsel is right. However, in a case like this, when the date of birth of any one is involved, the only person who can have any knowledge of the same have to be the parents or the Municipality and so it becomes difficult to imagine what the ITO could have done to rebut this evidence. Furthermore, a notice of the appeal must have gone to the ITO and he was also represented before the Appellate Tribunal. Assuming that the ITO was not present on the date of hearing before the AAC and could not rebut the evidence, it was open to the ITO to bring the necessary facts before the Appellate Tribunal at the time of the hearing of the second appeal.

5. This matter is really a simple one in terms of procedure. The AAC hears an appeal after giving a notice to the ITO. The AAC has power while deciding an appeal to make a further enquiry himself or to direct the ITO to make a further enquiry and make a report. This is provided u/sub-s. (4) of s. 250. The AAC made the enquiry himself in the sense that he took the evidence. So, the question of remanding the case to the ITO did not really arise because there is a choice of procedure and the two procedures cannot be mixed up i.e. evidence cannot be taken by the AAC and then decision recorded by the ITO. Assuming for argument's sake that the AAC came to the view that further opportunity is to be given to the ITO and he remanded the case, it would still have to be shown as to what were the facts that the ITO could have brought out having bearing on this case. The question has become vital at this late stage because any answer we give to the question has very serious repercussion on the assessed.

6. The accounting period ended on 31-3-1968. The order refusing registration was passed on 4-2-1972. So that four years had already elapsed. The appeal was heard by the AAC on 15-1-1978, about five years later. The Appellate Tribunal heard the case in December, 1978, when nearly six years were over. The Tribunal was of the view that multiplicity of the proceedings could have been avoided by the AAC taking into consideration the fairly simple evidence that was before him. If we now hold that legal procedure should be followed and this is in May, 1984. The whole matter will have to go back to the ITO just to examine the correctness of the certificate of New Delhi Municipal Committee. We do not think that such a procedure should be followed and especially at this late stage. We can understand of some different facts where it may be difficult to insist on the AAC deciding the case on new facts himself and it may be necessary that there should be remand order to the ITO. Such a remand order is dealt with in s. 251, because the AAC may either decide the case himself or give directions to the ITO to deal with the case. If complex new facts arise, no doubt, it is better that the ITO should deal with the same and if possible find some rebuting material, but in a case of this type, i.e., the date of birth, which is personal matter, the certificate of New Delhi Municipal Committee plus the affidavit of the father should be sufficient.

7. There is an intriguing point inasmuch as the mother gave the date of birth as December, 1949 and the father gave the date of birth as January, 1949. We feel that there was some mistake in the affidavit of the mother, which may be typographical because we cannot imagine that she should give an affidavit showing her son minor. So, in the circumstances of the case we think that the Tribunal was right in setting aside the order of the AAC to the extent that it remanded the case back to the ITO. We would accordingly answer the question referred to us in the affirmative in favor of the assessed and against the department. This point has to be viewed only on the exceptional facts of this case. There will be no order as to costs.