Landmark Judgements of Supreme Court on Section Section 254 [Orders of Appellate Tribunal]

High Court finding that there was no demonstrated perversity in Tribunal's order, dismissed review petition filed by assessee, SLP filed against said order was to be dismissed

Appellate Tribunal - Order of (Scope of) - In course of appellate proceedings, High Court confirmed order passed by Tribunal. Assessee thus filed a review petition. High Court noted that Supreme Court in case of Vijay Kumar Talwar v. CIT (2011) 330 ITR 1 : 196 Taxman 136 (2010) 8 taxmann.com 264 (SC) held that Tribunal being a final fact finding authority, in absence of demonstrated perversity in its finding, interference therewith by High Court was not warranted. Relying upon aforesaid order of Supreme Court, High Court dismissed review petition filed by assessee. On facts, SLP filed against decision of High Court was to be dismissed. [In favour of revenue] – [Mahaveer Yadav v. ITO (2019) Taxman 162 : 107 taxmann.com 380 (SC)]

Unless order of a Bench is signed by all Members constituting it and is dated, it is not an order of Tribunal.

– [Income-tax Appellate Tribunal Through President v. V.K. Agarwal (1999) 235 ITR 175 : (1998) 101

Taxman 382 : 150 CTR 513 (SC)]

Tribunal has jurisdiction to examine a question of law even though raised for the first time before the Tribunal, which arises from the facts as found by the authorities below and having a bearing on the tax liability of the assessee

It was held that under section 254, 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 is denied, there is no 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. There is no reason to restrict the power of the Tribunal under section 254 only to decide the grounds which arise from the order of the Commissioner (Appeals). Both the assessee as well as the department have a right to file an appeal/cross-objections before the Tribunal. The Tribunal should not be prevented from considering questions of law arising in assessment proceedings although not raised earlier. - [National Thermal Power Co. Ltd. v. CIT (1998) 229 ITR 383: (1999) 157 CTR 249 (SC)]

Tribunal’s power is limited to the subject-matter of the appeal before it

Tribunal’s power is limited to the subject-matter of the appeal before it. The powers of the Tribunal in dealing with appeals are expressed in section 254(1) in the widest possible terms. The words ‘Therefore of’ restrict the Jurisdiction of the Tribunal to subject-matter of the appeal. — [Hukumch and Mills Ltd. v. CIT (1967) 63 ITR 232 (SC).

The power restricted to the year under appeal, incidental observations relating to other years, if any, made is not strictly speaking, a finding. The Tribunal has no jurisdiction to give direction with regard to the proceedings of the earlier year or to include deleted amount in other assessment years.—[ITO v. Murlidhar Bhagwan Das (1964) 52 ITR 335 (SC)]