Manchanda International vs Commissioner Of Income Tax
2004 Latest Caselaw 274 Del

JUDGMENT

B.C. Patel, C.J.

1. Admit.

2. At the request of learned counsel for the parties, we are taking up this appeal for final disposal.

3. The question that is to be considered by the Court is as under :

"Whether the Tribunal, while restoring the additions to the file of AO, exceeded its jurisdiction in restoring the addition in relation to the trade creditor namely, M/s M.S. Impex, which was not even the subject-matter of appeal ?

4. Admittedly, it is very clear that so far as M/s M.S. Impex is concerned, CIT(A) accepted the contention of the assessed and that the Revenue did not challenge this finding in appeal. Before the Tribunal, the question was with regard to the addition in respect of M/s G.S. Enterprises and M/s Rattan Fashions. There was no question before the Tribunal with regard to M/s M.S. Impex, Delhi. The CIT(A) had held as under :

"This also goes to prove that M/s M.S. Impex is a genuine creditor and that has to be allowed. Accordingly, the addition of credit balance standing in the name of M/s Impex cannot also be sustained."

5. As stated above, the Revenue did not prefer any appeal against this finding. In view of this, it is very clear that the Tribunal has committed a serious error in restoring this issue also to the file of the AO. The order can be said to be perverse insofar as inclusion of the name of M/s M.S. Impex, Delhi, is concerned as the Tribunal was concerned with only two parties which we have referred hereinabove. The Tribunal was not justified in interfering insofar as the part which was accepted by the CIT(A) and against which the Revenue had not preferred any appeal.

6. In the result, the appeal is allowed to the extent that the case remanded by the Tribunal to the AO shall exclude the issue in respect of M/s Impex, Delhi, to the tune of Rs. 2,11,250 which stood settled by the order of the CIT(A). Accordingly, the appeal is allowed in favor of the assessed and against the Revenue.