M/S Ram Ji Dass & Co. Abohar v. The Commissioner Of Income Tax, Patiala

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH ITR No. 201 of 1999 (O&M)Date of decision: November 9, 2009 M/s Ram Ji Dass & Co. Abohar...Appellants Versus The Commissioner of Income Tax, Patiala....Respondent CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOELHON'BLE MR. JUSTICE GURDEV SINGH Present: Mr. Animesh Sharma, Advocate, for the assessee.Ms. Savita Saxena, Advocate, for the revenue. ORDER 1. Income Tax Appellate Tribunal, Amritsar, has referred thefollowing question of law for the opinion of this Court under Section 256(1) of Income Tax Act, 1961 (for short, “the Act”) in compliance of order ofthis Court dated 2.12.1998 and arising out of the order of the Tribunal inC.O. No. 101 (ASR)/1993 in ITA No. 801 (ASR)/1993) dated 31.8.1999 forthe assessment year 1990-91:- “(i) Whether on the facts and in the circumstances of thecase, the Tribunal was right in law in dismissing the cross-objections filed by the assessee on the ground that whiledeciding the revenue's appeal the Tribunal had alreadyconsidered the question relating to the rate of profits and hadupheld the same and it could not be re-examined there after in assessee's cross objections”. 2.The Assessing Officer rejected the books of account andassessed net profit @ 10% of the turn over. On appeal, net profit rate wasreduced to 9.25%. The Department filed appeal before the Tribunal and theassessee filed cross-objections. The appeal of the Department wasdismissed but cross-objections of the assessee were not considered onmerits, while dismissing the appeal of the Department. The assessee appliedfor recalling of the order and for decision of cross-objections on merits.This prayer was rejected with the following observations:- “15.3 It is observed that the Tribunal vide its order dated18.4.1995 have already dismissed the appeal of the Revenuewhereby they had agitated the relief given by the learned CIT(A). In the process, the Tribunal upheld the net profit rate of9.25% as applied by the learned CIT (A). Since appeal inI.T.A. No. 801 (ASR)/93 filed by the Department has not beenrecalled, the earlier order of the Tribunal stands in this behalfaccordingly, we see no reason to interfere with the orders of thelearned CIT (A) as already upheld by the Tribunal.”3.We have heard learned counsel for the parties. 4.Learned counsel for the assessee submits that while decidingthe appeal of the Department, the Tribunal only considered whetherreduction of the net profit rate from 10% to 9.25% was justified or not andnot the question whether said rate should be further reduced to 6.29%, assought by the assessee. Reliance has been placed on Hari Shankar Rastogiversus Sham Manohar and others(2005) 3 Supreme Court Cases 761, aboutthe scope of cross objections. ITR No. 201 of 1999 5.From perusal of the impugned order, it is clear that the viewpoint of the assessee put forward by way of cross-objections was notconsidered on merits. Accordingly, question referred has to be answered infavour of the assessee and against the Department. The cross-objections ofthe assessee are, thus, required to be heard and decided on merits. 6.Reference is disposed of. (ADARSH KUMAR GOEL) JUDGE November 9, 2009 prem (GURDEV SINGH ) JUDGE