M/S.asia Resorts Ltd v. Commissioner Income Tax(Central

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA ITA No.3 of 2005. Judgment Reserved on:24.06.2011. Decided on: September 07, 2011. M/s.Asia Resorts Ltd. ..Appellant. Versus Commissioner Income Tax(Central) ..Respondent. Coram The Hon’ble Mr. Justice R.B.Misra, Judge. The Hon’ble Mr.Justice Surinder Singh, Judge. Whether approved for reporting?[1]. Yes. For the Appellant: Mr.K.D.Sood, Advocate with Mr.SanjeevSood & Mr.Sandeep Pandey, Advocates. For the Respondent: Mr.Vinay Kuthiala, Advocate with Mr.Gaurav Sharma, Advocate. Justice R.B.Misra, Judge. The present appeal has been preferred under Section 260A of the Income Tax Act, 1961 (in short ‘IT Act’) against the judgment and order dated 6.4.2004 of the Income Tax Appellate Tribunal, Chandigarh Bench, Chandigarh ( in short ‘ITAT’) passed in Miscellaneous Application 91/Chandi/03 preferred in ITA No.219/CHD/2002 pertaining to the assessment year 1997-98 thereby reviewing its earlier order. 1Whether the reporters of the local papers may be allowed to see the Judgment? 2.The present appeal, in question, has been admitted for consideration on the following substantial questions of law:- (A)Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in modifying its earlier order. of the case, the Income Tax Appellate Tribunal was justified in modifying its earlier order. (B)Whether on the facts and in the circumstances of the case the findings of the Income Tax Appellate Tribunal in accepting the ‘Miscellaneous Petition for rectification’ of the department are wrong and perverse. of the case the findings of the Income Tax Appellate Tribunal in accepting the ‘Miscellaneous Petition for rectification’ of the department are wrong and perverse. (C)Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in holding that there is a mistake apparent from the record committed in its earlier order and thus liable for rectification. of the case, the Income Tax Appellate Tribunal was justified in holding that there is a mistake apparent from the record committed in its earlier order and thus liable for rectification. (D)Whether on the facts and in the circumstances of the case, the action of Income Tax Appellate Tribunal amounts to review of its earlier order passed after due deliberations to the past history, legal provisions, judicial pronouncements and due application of mind, and thus impermissible under the provisions of the Income Tax Act, 1961. of the case, the action of Income Tax Appellate Tribunal amounts to review of its earlier order passed after due deliberations to the past history, legal provisions, judicial pronouncements and due application of mind, and thus impermissible under the provisions of the Income Tax Act, 1961. (E)Whether on the facts and in the circumstances of the case, once the ITAT had granted a relief vide order passed under Section 254 (1) of the Income Tax Act, 1961 to the appellant which he was entitled as per law, was it justified in of the case, once the ITAT had granted a relief vide order passed under Section 254 (1) of the Income Tax Act, 1961 to the appellant which he was entitled as per law, was it justified in imposing unlawful taxes on appellant by way of rectification on the technical ground that it cannot grant such relief, when there is no dispute as such to the legality, genuineness and correctness of the tax treatment to the receipts under dispute. (F)Whether on the facts and in the circumstances of the case the order of Income Tax Appellate Tribunal was self contradictory vis-à-vis paras 11, 17 and 16 thereof, justifying the alleged review / rectification. of the case the order of Income Tax Appellate Tribunal was self contradictory vis-à-vis paras 11, 17 and 16 thereof, justifying the alleged review / rectification. imposing unlawful taxes on appellant by way of rectification on the technical ground that it cannot grant such relief, when there is no dispute as such to the legality, genuineness and correctness of the tax treatment to the receipts under dispute. (F)Whether on the facts and in the circumstances of the case the order of Income Tax Appellate Tribunal was self contradictory vis-à-vis paras 11, 17 and 16 thereof, justifying the alleged review / rectification. of the case the order of Income Tax Appellate Tribunal was self contradictory vis-à-vis paras 11, 17 and 16 thereof, justifying the alleged review / rectification. 3. In order to adjudicate the above substantial questions of law, it is necessary to give brief history of the case. The appellant is running various Resorts at various places and is offering the occupation of the various huts / flats / suites to the public on ‘time sharing basis’ for different time period, against the payment of different quantum of charges, called fee, payable in lump-sum and once for all. Against such allotment of time sharing the appellant retains the liability to provide the agreed type of accommodation and other services / facilities, as per the written agreement arrived at the time of allotment of such time sharing occupation for whole of the period of the scheme called lease period. During the period relevant to the assessment year under appeal the appellant had received a total fee on account of sale of such time sharing periods of `1,27,81,072/- from 459 members, out of whom only 249 members had paid full amount of the time share amounting to `54,68,088/-. During the course of assessment proceedings the Assessing Officer (in short ‘AO’), after referring to the assessment of another assessee, namely, M/s.Sterling Resorts, carrying the same business like the appellant, came to the conclusion that 45% of the total receipts were attributable to appellant’s liability to provide stay to the members and, therefore, was attributable to the fixed assets such as building and other infrastructure which the appellant had permanently acquired and consequently considered that 45% part of the receipts as capital receipts liable to be adjusted against the cost of such permanent assets. The appellant agreed to this conclusion of the ‘AO’ and consequently 45% of the receipts were considered as capital receipts and were adjusted against the building cost. The balance 55% was considered as revenue receipt, attributable to the appellant’s liability for whole of the period of lease i.e. for 99 years; and, therefore, only 1/99[th] part of 55% of the receipts was considered as revenue receipt for the assessment year under appeal. 4.The order for the assessment year 1997-98 was passed on 29.2.2000 (Annexure A-2), however, the appellant was served with a notice (Annexure A-3) dated 18.3.2002 under Section 263 of the ‘IT Act’ by the Commissioner of Income Tax (Central) (for short ‘CIT’) who after considering the objections of the appellant vide its order dated 28.3.2000 (Annexure A-4) set aside the assessment order, treating the whole of the receipt taxable in the year when the membership fee was received, thereby treating the verdict of ‘AO’ erroneous and prejudicial to the interest of the revenue and giving direction to ‘AO’ to make it de novo. Being aggrieved, appellant preferred an appeal i.e. ITA No.219/Chandi/2002, which too was disposed of by ‘ITAT’ vide its order dated 11.3.2003 with directions and observations. 5.The respondent / revenue, being aggrieved, filed an appeal before this Court, namely, ITA No.40 of 2003 which is pending adjudication. The respondent / CIT (Central) preferred a miscellaneous petition under Section 254 (2) of ‘IT Act’ before ‘ITAT’ for rectification of its earlier order dated 11.3.2003. The said application of Commissioner / revenue was allowed by ‘ITAT’ vide impugned order dated 6.4.2004, reviewing / rectifying its earlier order. 6.The ‘CIT’ in Para-3 of his notice dated 18.3.2002 / (Annexure A-3) has mentioned as below:- 5.The respondent / revenue, being aggrieved, filed an appeal before this Court, namely, ITA No.40 of 2003 which is pending adjudication. The respondent / CIT (Central) preferred a miscellaneous petition under Section 254 (2) of ‘IT Act’ before ‘ITAT’ for rectification of its earlier order dated 11.3.2003. The said application of Commissioner / revenue was allowed by ‘ITAT’ vide impugned order dated 6.4.2004, reviewing / rectifying its earlier order. 6.The ‘CIT’ in Para-3 of his notice dated 18.3.2002 / (Annexure A-3) has mentioned as below:- “Even otherwise the non-refundable fees received from the member is constituted of 2 parts – one is towards the free stay in the hotel and the other is for other facilities agreed to be provided. As regards the stay, the infrastructure is already in existence and on which the assessee is claiming depreciation. The fee towards this, which of course is to be estimated and in this case has been estimated at 45% has accrued for good and against which there is no recurring liability. As regards the second part, which again is a revenue receipt but is fasten with a recurring liability the same can be regarded as belonging to the entire period.” 7.The ‘CIT’ in its order dated 28.3.2002 (Annexure A-4) discussed in brief about the treatment of 45% of the receipts treated by ‘AO’ to be of capital in nature and held the same to be of revenue in nature (as originally treated by assessee in his return) but in addition thereto held that the same should be treated as taxable fully in the year of receipt. While concluding his order, the ‘CIT’ considered the whole receipt as taxable in the year of receipt and directed the ‘AO’ accordingly. As such, ‘CIT’ has not only travelled against his own notice rather contradicted his opinion as indicated in his notice regarding rest of 55% receipt which he in his notice agreed to be fastened with a recurring liability and pertaining to whole period of membership. / 8.‘ITAT’ in its order dated 11.3.2003 / (Annexure A-6) dealt with all the issues. The relevant extract is given as below:- “(A) Regarding 45% share: (‘AO’ treated such share as capital receipt and reduced the same from ‘Block of Assets’ but ‘CIT’ treated it as revenue taxable wholly in the year of receipt). (i) ‘ITAT’ has analyzed the issue in Paragraph-10 of its order and observed in Paragraph-11 as below: - “11. After having considered the rival submission and the facts and circumstances of the case and various decisions, facts and circumstances of the case and various decisions, we are of the opinion that so far as ‘AO’s reliance on the assessment order of M/s.Sterling Resorts for attributing 45% of the receipts towards fixed assets and considering the sum as of capital nature is concerned, the assessment order of M/s.Sterling Resorts is really silent on this point. We have no option but to accept the submission of Ld. Departmental Representative that the actions of ‘AO’ considering 45% of the receipts as of capital nature by relying on assessment order in case of M/s.Sterling Resorts was misplaced and had rendered the assessment order to that extent erroneous in nature. Further, this erroneousness having resulted in loss to the revenue, the assessment to that extent was erroneous so as to be prejudicial to the interest of the revenue. We, therefore, uphold the validity of order u/s 263 to that extent, though subject to our further findings on the issue.” (Emphasis by appellant). (ii) In Paragraph-16 of its order, ‘ITAT’ further indicated in continuation to his observations made in Paragraph-11 (above). The contents of Paragraph-16 read as under:- the receipts as of capital nature by relying on assessment order in case of M/s.Sterling Resorts was misplaced and had rendered the assessment order to that extent erroneous in nature. Further, this erroneousness having resulted in loss to the revenue, the assessment to that extent was erroneous so as to be prejudicial to the interest of the revenue. We, therefore, uphold the validity of order u/s 263 to that extent, though subject to our further findings on the issue.” (Emphasis by appellant). (ii) In Paragraph-16 of its order, ‘ITAT’ further indicated in continuation to his observations made in Paragraph-11 (above). The contents of Paragraph-16 read as under:- “16. Coming to the 45% part of the receipts, which has been considered by the Commissioner not only as revenue nature but also as income in the current year alone, we, so far as the revenue nature is concerned, have already upheld the order of Commissioner (Para 10), but so far as the period to which the receipts relate is concerned, we are, in view of the revenue’s own stand in assessee’s own case for assessment year 1996-97 and the fact that there is no provision of law to support the Commissioner’s stand that 45% of the receipts were relatable to ‘stay part’ of the agreement and assessee has no recurring liability on that account nor such a presumption of the Commissioner is sustainable on facts because even if it is made relatable to the ‘stay part’ of the agreement then also the assessee is bound to have recurring liability in future such as repair, maintenance, renovation, replacement and safety of the infrastructure for 99 years, are of the opinion that there is no justification for segregating the receipts being relatable and part of a composite agreement applicable to the whole of the period of lease and assessee’s liability being to fulfill the terms and conditions of the agreement throughout the period of lease, such an opinion of the Commissioner which is otherwise also is not supported by facts or in law cannot be sustained.” (iii) In Paragraph-17 of its order, ‘ITAT’ has observed as under:- “17. In view of the above discussion, we are unable to uphold the view expressed by Commissioner on this point and therefore, we modify his directions to the effect that the 45% of the receipts are relatable to the whole of the period of lease which may be 33 years or 49 years or 99 years as the case may be and therefore the 45% part of the whole receipts may also be dealt with in the same manner (taxed) by the ‘AO’ as the balance 55% of the receipts has been dealt with (taxed).” (B) Regarding 55% share: To appreciate the tax treatment given to balance 55% of the receipts, following aspects need attention:- (a) ‘A.O.’ in his order has accepted the treatment of spreading the receipts over the years of membership tenure. (b) ‘CIT’ sought to tax it fully in the year of receipt. (c) ‘ITAT’, in Para-13 of its order set aside the order of ‘CIT’ and has observed in Paragraph-13.2 as under:- “Following the decision of the Hon’ble High Court, we are of the opinion that Commissioner’s decision to consider the 55% portion of the receipts as income of the current year, instead of considering the same as for 99 years is contrary to his intention with which he initiated the proceedings u/s 263 of the Act and therefore, the same is bad in law and liable to be struck down. Respectfully following the decision of the Hon’ble High Court of Punjab & Haryana and in the facts and circumstances of the case we strike that portion of the order u/ s 263 of the Act, i.e. the findings of the Commissioner, relating to consideration of 55% of the receipts as income for current year are set aside / deleted.” 9. The modification / rectification sought by revenue in the order dated 11.3.2003 (Annexure A-6) of ‘ITAT’ by way of MA No.91/Chandi/03 (Annexure A-5) are mainly on the grounds given as follows:- (i) The order of ‘ITAT’ is self contradictory: As in Para-11 of its order ‘ITAT’ is contradictory to contrary to his intention with which he initiated the proceedings u/s 263 of the Act and therefore, the same is bad in law and liable to be struck down. Respectfully following the decision of the Hon’ble High Court of Punjab & Haryana and in the facts and circumstances of the case we strike that portion of the order u/ s 263 of the Act, i.e. the findings of the Commissioner, relating to consideration of 55% of the receipts as income for current year are set aside / deleted.” 9. The modification / rectification sought by revenue in the order dated 11.3.2003 (Annexure A-6) of ‘ITAT’ by way of MA No.91/Chandi/03 (Annexure A-5) are mainly on the grounds given as follows:- (i) The order of ‘ITAT’ is self contradictory: As in Para-11 of its order ‘ITAT’ is contradictory to Para-17, whereas, in Para-11, ‘ITAT’ has confirmed the order of ‘CIT’ in treating the 45% portion as revenue but in Para-17 it has directed that the same should not be taxed fully in the year of receipt as contended by Commissioner but be taxable proportionately over the period of lease / agreement. (ii) ‘ITAT’ cannot grant relief more than that claimed for: As the appellant during assessment had agreed to treat 45% portion of receipts from time sharing scheme as capital and deductible from Block of Assets, but ‘ITAT’ in its initial order held that the same should be treated as taxable proportionately over the years of lease / agreement, by which means the appellant got more relief than that agreed to in assessment. (iii) ‘ITAT’ cannot comment on years not under appeal: In Para-19, ‘ITAT’ has given its opinion even for the tax treatment of future years which is not in its domain. 10.In order to appreciate the true controversy, it is necessary to give the extract of the provisions of relevant Sections of ‘IT Act’:- Section 254:Orders of Appellate Tribunal. (1) The Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. (2) The Appellate Tribunal may, at any time within four years from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub-section (1) and shall make such amendment if the mistake is brought to its notice by the assessee or the Assessing Officer: Provided that an amendment which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this sub-section unless the Appellate Tribunal has given notice to the assessee of its intention to do so and has allowed the assessee a reasonable opportunity of being heard : Provided further that any application filed by the assessee in this sub-section on or after the 1[st] day of October, 1998, shall be accompanied by a fee of fifty rupees. (2A) In every appeal, the Appellate Tribunal, where it is possible, may hear and decide such appeal within a period of four years from the end of the financial year in which such appeal is filed under sub- section (1) of section 253. Provided that the Appellate Tribunal may, after considering the merits of the application made by the assessee, pass an order of stay in any proceedings relating to an appeal filed under sub-section (1) of Section 253, for a period not exceeding one hundred and eighty days from the date of such order and the Appellate Tribunal shall dispose of the appeal within the said period of stay specified in that order: October, 1998, shall be accompanied by a fee of fifty rupees. (2A) In every appeal, the Appellate Tribunal, where it is possible, may hear and decide such appeal within a period of four years from the end of the financial year in which such appeal is filed under sub- section (1) of section 253. Provided that the Appellate Tribunal may, after considering the merits of the application made by the assessee, pass an order of stay in any proceedings relating to an appeal filed under sub-section (1) of Section 253, for a period not exceeding one hundred and eighty days from the date of such order and the Appellate Tribunal shall dispose of the appeal within the said period of stay specified in that order: Provided further that where such appeal is not so disposed of within the said period of stay as specified in the order of stay, the Appellate Tribunal may, on an application made in this behalf by the assessee and on being satisfied that the delay in disposing of the appeal is not attributable to the assessee, extend the period of stay, or pass an order of stay for a further period or periods as it thinks fit; so, however, that the aggregate of the period originally allowed and the period or periods so extended or allowed shall not, in any case, exceed three hundred and sixty five days and the Appellate Tribunal shall dispose of the appeal within the period or periods of stay so extended or allowed: Provided also that if such appeal is not so disposed of within the period allowed under the first proviso or the period or periods extended or allowed under the second proviso, which shall not, in any case, exceed three hundred and sixty five days, the order of stay shall stand vacated after the expiry of such period or periods, even if the delay in disposing of the appeal is not attributable to the assessee. (2B) The cost of any appeal to the Appellate Tribunal shall be at the discretion of that Tribunal. (3) The Appellate Tribunal shall send a copy of any orders passed under this section to the assessee and to the Commissioner. (4) Save as provided in section 256 or section 260A, orders passed by the Appellate Tribunal on appeal shall be final.” Section 260A of the ‘IT Act’ reads as below:- “(1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal, if the High Court is satisfied that the case involves a substantial question of law. (2) The Chief Commissioner or the Commissioner or an assessee aggrieved by any order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal under this sub - section shall be - (a) filed within one hundred and twenty days from the date on which the order appealed against is received by the assessee or the Chief Commissioner or Commissioner. (b) xx xxx xxx (c) In the form of a memorandum of appeal precisely stating therein the substantial question of law involved. (2A) The High Court may admit an appeal after the expiry of the period of one hundred and twenty days referred to in clause (a) of sub-section (2), if it is satisfied that there was sufficient cause for not filing the same within that period. (3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (4) The appeal shall be heard only on the question so formulated, and the respondents shall at the hearing of the appeal, be allowed to argue that the case does not involve such question : Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question. (5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (6) The High Court may determine any issue which – (a) Has not been determined by the Appellate Tribunal : or (4) The appeal shall be heard only on the question so formulated, and the respondents shall at the hearing of the appeal, be allowed to argue that the case does not involve such question : Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question. (5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (6) The High Court may determine any issue which – (a) Has not been determined by the Appellate Tribunal : or (b) Has been wrongly determined by the Appellate Tribunal, by reason of a decision on such question of law as is referred to in sub-section (1) (7) Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the High Court shall, as far as may be, apply in the case of appeals under this section.” Section 263 of the ‘IT Act’ reads as below: “(1) The Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interest of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment. Explanation : For the removal of doubts, it is hereby declared that, for the purposes of this sub-section, - (a) An order passed on or before or after the 1st day of June, 1988 by the Assessing Officer shall include – (i) An order of assessment made by the Assistant Commissioner or Joint Commissioner or the Income-tax Officer on the basis of the directions issued by the Deputy Commissioner under section 144A; (ii) An order made by the Joint Commissioner in exercise of the powers or in the performance of the functions of an Assessing Officer conferred on, or assigned to, him under the orders or directions issued by the Board or by the Chief Commissioner or Director General or Commissioner authorised by the Board in this behalf under section 120; (b) "Record" shall include and shall be deemed always to have included all records relating to any proceeding under this Act available at the time of examination by the Commissioner; (c) Where any order referred to in this sub-section and passed by the Assessing Officer had been the subject matter of any appeal filed on or before or after the 1st day of June, 1988, the powers of the Commissioner under this sub-section shall extend and shall be deemed always to have extended to such matters as had not been considered and decided in such appeal. (2) No order shall be made under sub-section (1) after the expiry of two years from the end of the financial year in which the order sought to be revised was passed. (3) Notwithstanding anything contained in sub-section (2), an order in revision under this section may be passed at any time in the case of an order which has been passed in consequence of, or to give effect to, any finding or direction contained in an order of the Appellate Tribunal, the High Court or the Supreme Court. Explanation : In computing the period of limitation for the purposes of sub-section (2), the time taken in giving an opportunity to the assessee to be reheard under the proviso of section 129 and any period during which any proceeding under this section is stayed by an order or injunction of any court shall be excluded.” 11. The following submissions have been made on behalf of the appellant:- (3) Notwithstanding anything contained in sub-section (2), an order in revision under this section may be passed at any time in the case of an order which has been passed in consequence of, or to give effect to, any finding or direction contained in an order of the Appellate Tribunal, the High Court or the Supreme Court. Explanation : In computing the period of limitation for the purposes of sub-section (2), the time taken in giving an opportunity to the assessee to be reheard under the proviso of section 129 and any period during which any proceeding under this section is stayed by an order or injunction of any court shall be excluded.” 11. The following submissions have been made on behalf of the appellant:- (i)‘ITAT’ has erred in reviewing / rectifying in its order in the garb of error apparent on the record, moreso, when earlier order was passed by ‘ITAT’ after due deliberation and elaboration over the subject matter; the garb of error apparent on the record, moreso, when earlier order was passed by ‘ITAT’ after due deliberation and elaboration over the subject matter; (ii)‘ITAT’ has erred in carrying out rectification in its order on the misconception regarding its power to comment upon ‘future tax implications’ of the ‘receipts of year under appeal’, confusing it with the power to comment upon ‘tax implications’ of the ‘receipts of future years’, meaning thereby the revenue receipt of 55% was to be spread over as income as per the scheme/agreement with each customer i.e. 33, 49 or 99 years as the case may be, so much so, it was imperative to mention that the remaining part of 55% pertaining to future years would be taxed proportionately in such future years. on the misconception regarding its power to comment upon ‘future tax implications’ of the ‘receipts of year under appeal’, confusing it with the power to comment upon ‘tax implications’ of the ‘receipts of future years’, meaning thereby the revenue receipt of 55% was to be spread over as income as per the scheme/agreement with each customer i.e. 33, 49 or 99 years as the case may be, so much so, it was imperative to mention that the remaining part of 55% pertaining to future years would be taxed proportionately in such future years. Whereas, there was no recommendation about the taxability of the receipts of subsequent years and same was wrongly understood by the revenue, and thus to this extent the filing of Miscellaneous Petition was misconceived as such the orders passed in pursuance thereof is erroneous; (iii)‘ITAT’ has passed its initial order after a long discussion and thorough analysis of the subject matter and thus has erred in carrying out review of a debatable issue in the garb of rectification, which is impermissible as per observations of Hon’ble Supreme Court made in T.S. Balaram, I.T.O Company Circle IV versusVolkart Brothers &others (1971) 82 ITR 50 (SC).and thorough analysis of the subject matter and thus has erred in carrying out review of a debatable issue in the garb of rectification, which is impermissible as per observations of Hon’ble Supreme Court made in T.S. Balaram, I.T.O Company Circle IV versusVolkart Brothers &others (1971) 82 ITR 50 (SC). 12. In support of the above contentions, following submissions have also been advanced:- (A)In respect of issue that order of ‘ITAT’ is self contradictory, it has been submitted that in Para-11 of the order, ‘ITAT’ has only partly accepted the order of ‘CIT’ under Section 263, i.e. to the limited extent of determining the nature of the receipt to be Revenue rather than capital as treated so by the ‘A.O.’ while the appellant had originally treated the same as revenue spread proportionately over the years of lease / agreement. The last line of Para-11 reads as under:- “We therefore uphold the validity of the order U/s 263 to that extent, though, subject to our furtherfindings on the issue” 12. In support of the above contentions, following submissions have also been advanced:- (A)In respect of issue that order of ‘ITAT’ is self contradictory, it has been submitted that in Para-11 of the order, ‘ITAT’ has only partly accepted the order of ‘CIT’ under Section 263, i.e. to the limited extent of determining the nature of the receipt to be Revenue rather than capital as treated so by the ‘A.O.’ while the appellant had originally treated the same as revenue spread proportionately over the years of lease / agreement. The last line of Para-11 reads as under:- “We therefore uphold the validity of the order U/s 263 to that extent, though, subject to our furtherfindings on the issue” According to the appellant, there is no ambiguity / contradiction as the ‘ITAT’ has observed that this finding is subject to further findings in the said order. Whereas, in Para-16 it has given its further (B) (i) (ii) findings on the subject matter, which if read with the contents of Paragraph-17, would indicate that though 45% of receipt is of revenue nature, but it has to be taxed proportionately over the years of agreement / lease, moreso, when such observation was never challenged either by the revenue or by the appellant. In respect of issue that ‘ITAT’ had granted relief to the appellant which it was not legally entitled; following submissions have been advanced for and on behalf of the appellant:- The appellant / assessee had filed its return treating the whole receipts including impugned 45% portion as revenue income accordingly spreading proportionately over several years of lease / agreement. ‘ITAT’ has restored the position as per the return filed by the appellant and in so deciding the ‘ITAT’ has in its earlier order taken into consideration the following aspects:- filed by the appellant and in so deciding the ‘ITAT’ has in its earlier order taken into consideration the following aspects:- (a)The department has followed/accepted ‘proportionate Tax Treatment’ for the A.Y 1996-97 in scrutiny assessment (as held in para 15 of the original order / (Annexure A-6) of ‘ITAT’; ‘proportionate Tax Treatment’ for the A.Y 1996-97 in scrutiny assessment (as held in para 15 of the original order / (Annexure A-6) of ‘ITAT’; (b)The appellant since beginning has been pleading that the taxability should be over the years of agreement. years of agreement. (c)There is no reason to segregate the gross receipts as it belongs to one composite agreement. receipts as it belongs to one composite agreement. (d)Even in case of ‘stay part of agreement’ the appellant has a recurring liability for repair & maintenance of the premises, and appellant has a recurring liability for repair & maintenance of the premises, and (e)The appellant is bound under the agreement to fulfill the terms and conditions of the agreement over all the years to which the agreement runs so the receipt relating to the same should be proportionately taxed in those years. to fulfill the terms and conditions of the agreement over all the years to which the agreement runs so the receipt relating to the same should be proportionately taxed in those years. (C)It has also been submitted on behalf of the appellant that ‘ITAT’ can grant any relief. In support of such proposition, following submissions have also been made:- that ‘ITAT’ can grant any relief. In support of such proposition, following submissions have also been made:- (i)In National Thermal Power Co.Ltd. Versus Commissioner of Income Tax, (1998) 229 ITR 383 (SC)Hon’ble Supreme Court has observed on the Powers of ‘ITAT’ as under:- Commissioner of Income Tax, (1998) 229 ITR 383 (SC)Hon’ble Supreme Court has observed on the Powers of ‘ITAT’ as under:- (C)It has also been submitted on behalf of the appellant that ‘ITAT’ can grant any relief. In support of such proposition, following submissions have also been made:- that ‘ITAT’ can grant any relief. In support of such proposition, following submissions have also been made:- (i)In National Thermal Power Co.Ltd. Versus Commissioner of Income Tax, (1998) 229 ITR 383 (SC)Hon’ble Supreme Court has observed on the Powers of ‘ITAT’ as under:- Commissioner of Income Tax, (1998) 229 ITR 383 (SC)Hon’ble Supreme Court has observed on the Powers of ‘ITAT’ as under:- “3. Under Section 254 of the ‘IT Act’ the Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. The power of the Tribunal in dealing with appeals is thus expressed in the widest possible terms. The purpose of the assessment proceedings before the taxing authorities is to assess correctly the tax liability of an assessee in accordance with law. If, for example, as a result of a judicial decision given while the appeal is pending before the Tribunal, it is found that a non- taxable item is taxed or a permissible deduction denied, we do not see any reason why the assessee should be prevented from raising that question before the Tribunal for the first time, so long as the relevant facts are on record in respect of that item. We do not see any reason to restrict the power of the Tribunal under Section 254 only to decide the grounds which arise from the order of the CIT (A). Both the assessee as well as the Department have a right to file an appeal / cross-objections before the Tribunal. We fail to see why the Tribunal should be prevented from considering questions of law arising in assessment proceedings although not raised earlier.” (ii) As observed in CIT versus P.B.Corporation reported in187 CTR 212 (GUJ) ‘ITAT’ can grant relief more than what could be given by AAC even if the appeal is filed by revenue. The High Court (Gujarat) has observed as below:- “Once the Tribunal found that there was no warrant for assessing the income at the particular amounts mentioned herein above, it was but natural that the entire matter was required to be kept at large and to permit the parties to lead evidence. In this set of circumstances the assessee could not have been tied down to the amounts assessed by the AAC and the Tribunal therefore could rightly set aside the orders passed by AAC as well. Apart from the fact that the provisions of Section 254(1) confer very wide powers on the appellate Tribunal, there is nothing in the provisions of Income Tax Act, 1961, which would have the effect of nullifying the provisions of order 41 Rue 33 of CPC, or the underlying principle that the appellate court may pass such order or decree as the case may require and this would also include orders in favour of any of the respondents although such a respondent may not have filed appeal or objection.” (iii) Gujarat High Court has also observed in CIT versus Maneklal Harilal SPG & Mfg. Co.Ltd., 106 ITR 24 and in 106 ITR 159that even if the particular point regarding which the reassessment proceedings were initiated has to be decided in favour of the assessee, (E) reassessment proceedings once initiated will not come to an end automatically. (iv) In Kella Appalaswamy & Sons versusCommissioner of Income Tax, Orissa 106 ITR 487 (ORI), it was observed that procedure is the hand maid and not a mistress of law, intended to sub-serve and facilitate the course of justice and not to govern or obstruct it. (D) (iii) Gujarat High Court has also observed in CIT versus Maneklal Harilal SPG & Mfg. Co.Ltd., 106 ITR 24 and in 106 ITR 159that even if the particular point regarding which the reassessment proceedings were initiated has to be decided in favour of the assessee, (E) reassessment proceedings once initiated will not come to an end automatically. (iv) In Kella Appalaswamy & Sons versusCommissioner of Income Tax, Orissa 106 ITR 487 (ORI), it was observed that procedure is the hand maid and not a mistress of law, intended to sub-serve and facilitate the course of justice and not to govern or obstruct it. (D) In Commissioner of Income Tax Gujarat -1 versus Ahmedabad Keiser-E-Hind Mills Co. Ltd., 128 ITR 486 (Guj), it has been observed that “Officers of the department must not take advantage of the ignorance of an assessee as to his rights. It is one of their duties to assist a taxpayer in every reasonable way, particularly in the matter of claiming and securing reliefs and in this regard the officer should take the initiative in guiding a tax payer where proceedings or other particulars before them indicate that some refund or relief is due to him. Ahmedabad Keiser-E-Hind Mills Co. Ltd., 128 ITR 486 (Guj), it has been observed that “Officers of the department must not take advantage of the ignorance of an assessee as to his rights. It is one of their duties to assist a taxpayer in every reasonable way, particularly in the matter of claiming and securing reliefs and in this regard the officer should take the initiative in guiding a tax payer where proceedings or other particulars before them indicate that some refund or relief is due to him. It has been submitted for and on behalf of the appellant that ‘ITAT’ has not actually given its opinion even for tax treatment of future years which is not in its domain. The contents of relevant Paragraph-19 of order of ‘ITAT’ are given as below:- “19. In view of above discussion, the order of the commissioner is modified as per observations / conclusions / findings / directions in the foregoing part of this order and the ‘Assessing Officer’ is directed to consider only the proportionate part of total receipts keeping in view the commissioner is modified as per observations / conclusions / findings / directions in the foregoing part of this order and the ‘Assessing Officer’ is directed to consider only the proportionate part of total receipts keeping in view the period of lease, in this assessment year and similarly in subsequent assessment years.” (F) Learned counsel for the appellant has submitted that reference to ‘subsequent years’ in the original order was basically in the context that the receipts of the year under appeal would be partly taxed in the year under appeal and balance proportionately in next years over the tenure of the scheme, i.e. balance of 33, 49, 99 years, which has altogether been misunderstood by the Revenue Department as being a comment on the tax treatment of similar receipts accruing in the subsequent years and sought rectification on that mistaken belief. ‘ITAT’ instead of elaborating the spirit of its order in MA No.91/2003 has again travelled beyond the main points and modified the earlier order in the garb of rectification. reference to ‘subsequent years’ in the original order was basically in the context that the receipts of the year under appeal would be partly taxed in the year under appeal and balance proportionately in next years over the tenure of the scheme, i.e. balance of 33, 49, 99 years, which has altogether been misunderstood by the Revenue Department as being a comment on the tax treatment of similar receipts accruing in the subsequent years and sought rectification on that mistaken belief. ‘ITAT’ instead of elaborating the spirit of its order in MA No.91/2003 has again travelled beyond the main points and modified the earlier order in the garb of rectification. (G)So far as the concession before ‘ITAT’ made by the learned counsel for the appellant is concerned; he, in fact, agreed that the tax treatment of ‘receipts of subsequent years’ cannot be commented upon by ‘ITAT’, but Tax treatment in subsequent years of ‘receipts pertaining to the year under appeal’ was correctly decided by the ‘ITAT’, however, this concession has been misconceived by ‘ITAT’ in the impugned order dated 6.4.2004. learned counsel for the appellant is concerned; he, in fact, agreed that the tax treatment of ‘receipts of subsequent years’ cannot be commented upon by ‘ITAT’, but Tax treatment in subsequent years of ‘receipts pertaining to the year under appeal’ was correctly decided by the ‘ITAT’, however, this concession has been misconceived by ‘ITAT’ in the impugned order dated 6.4.2004. (H)Further once it is held that 55% receipts is in a revenue receipt subject to proportionate taxability over the years of the scheme, then it is but obvious that it is to be taken as 1/33 years irrespective of any finding by ‘ITAT’ regarding subsequent years. 13. It has also consistently been held that a wrong concession by a counsel on question of law does not bind the client or any person as there can be no estopple against the Statute. (Vide Dr.H.S.Rikhy & Ors. Versus The New Delhi Municipal Committee, AIR 1962 SC 554; Bank of Bihar versus Mahabir Lal & Ors., AIR 1964 SC 377; Union of India & Anr. Versus K.S.Subramaninan, AIR 1989 SC 662; Dr.Ashok Kumar Maheshwariversus State of U.P. & Anr., (1998) 2 SCC 502; Uptron India Ltd. versus Shammi Bhan & Anr., AIR 1998 SC 1681 (Para 23); B.S.Bajwa & Anr. Versus State of Punjab & Ors., (1998) 2 SCC 523; M.I.Builders Pvt. Ltd. versus Radhey Shyam Sahu & Ors., (1999) 6 SCC 464; Jagdish Lal versus Parmanand, (2000) 5 SCC 44; Laxmibai (Smt.) versus Karnataka State Road Transport Corpn. Bangalore, (2001) 5 SCC 59; Union of India & Ors. Versus Mohanlal Likumal Punjabi & Ors., AIR 2004 SC 1704; and Union of India & Anr. Versus S.C.Parashar, (2006) SCC 167). 14.Even otherwise a wrong concession by an advocate regarding law or facts are not binding either on appellant or on any Court and thus can be challenged / rebutted in higher forums. Central Council for Research in Ayurveda & Siddha & Anotherversus Dr.K.Santhakumari, (2001) 5 SCC 60 (Paragraph-12). In view of the foregoing submissions, learned counsel for the appellant has also vehemently submitted as below:- (a)The order dated 11.3.2003 of ‘ITAT’ is not self contradictory, if Paragraphs 11, 16 and 17 are read jointly and harmoniously; contradictory, if Paragraphs 11, 16 and 17 are read jointly and harmoniously; (b)‘ITAT’ has granted only that much relief as the appellant herein was entitled to as per law and as per his income tax return; appellant herein was entitled to as per law and as per his income tax return; (c)‘ITAT’ can even grant more relief than that claimed in the Income Tax Return in view of the decisions in 229 ITR 383 (SC), 187 CTR 212 (Guj) 128 ITR 486 (Guj).claimed in the Income Tax Return in view of the decisions in 229 ITR 383 (SC), 187 CTR 212 (Guj) 128 ITR 486 (Guj). (d)The rectification regarding comment on ‘subsequent years’ is totally misconceived. ‘subsequent years’ is totally misconceived. (e)‘ITAT’ has wrongly reviewed and thereby reversed its order in the garb of rectification. reversed its order in the garb of rectification. 15.When primary facts nec