Commissioner Of Income-Tax vs Rathi Udyog Ltd.
1991 Latest Caselaw 210 Del

ORDER--Interest on additional demand of sales-tax--No demand of interest--Question of deductibility not a question arising out of Tribunal's order.

HELD :

The Tribunal having held that the contention had neither been raised nor dealt with by it, it was incumbent upon the petitioner to satisfy that a contention had been raised. In the absence of such an averment, it has to be accepted that the petitioner did not raise the contention before the Tribunal and, therefore, the Tribunal was right in coming to the conclusion that the question of law did not arise from its order.

Income Tax Act 1961 s.256

JUDGMENT

1. The petitioner seeks reference of the following question to this court :

"Whether, on the facts and in the circumstance of the case, the Income-tax Appellate Tribunal was correct in law in directing that the interest of Rs. 71,434 on the additional demand of sales tax may be allowed to the assessed by ignoring the material fact that there was no demand in respect of this interest from the Sales Tax Department and it had not been claimed as a deduction in the return of income on the basis of which the assessment had been made ?"

2. The said question was sought to be raised by the petitioner by filling an application under section 256(1) of the Income-tax Act, 1961. The Tribunal dealt with this in the following words :

"The question proposed by the Revenue does not arise out of the order of the Income-tax Appellate Tribunal inasmuch as the Bench was not addressed by the Revenue that there was no demand in respect of this interest from the Sales Tax Department."

3. The Tribunal then observed that the question proposed by the Revenue was misconceived and no question of law arose.

4. The petitioner has not alleged in the petition under section 256(2) that the Tribunal was wrong in observing that the contention giving rise to the question was, in fact, raised but not dealt with by the Tribunal. If a contention is raised but not dealt with, then a question of law can arise, but if a contention is neither raised nor dealt with, then a question of law cannot arise.

5. The Tribunal having held that the contention had neither been raised nor dealt with by it, it was incumbent upon the petitioner to satisfy this court that a contention had been raised. In the absence of such an averments, it has to be accepted that the petitioner did not raise the contention before the Tribunal and, therefore, the Tribunal was right in coming to the conclusion that the question of law did not arise from its order.

6. This petition accordingly dismissed.