1965 PLP 7 (PTD)

The petitioner appealed to the Appellate Assistant Commis sioner. While the appeal was pending the petitioner attained majority on July 19, 1959. On August 11, 1959, the Appellate Assistant Commissioner dismissed the appeal. On the 28th of November, 1958, the petitioner, filed an appeal to the Appellate Tribunal. It appears that during the pendency of this appeal, Mr. Padampat Singhania, the uncle of the petitioner, met the Commis sioner of Income‑tax on the 12th of March, 1960. He thereafter wrote a letter (Annexure "G" to the petition) to the Commissioner, on the 17th of March, 1960, apropos his interview and referred to the present case in these words: "It was the Income‑tax Officer who pointed out to us that the gift was void in law. It was on his advice that we cancelled the gift, and it was also on his advice that we included the amount of gift in the wealth‑tax return of Ajayapat Singhania and also offered interest on the amount of his assessment for income‑tax. Ajayapat has been subject to gift‑tax and wealth tax in respect of the amount of gift and income‑tax in respect of that interest on the amount gifted . . . . . . . . There was absolutely no motive to avoid any tax. This matter has been taken up in appeal to the Income‑tax Appellate Tribunal. If, however, you are favourably inclined to exempt Ajayapat from double taxation, I am prepared to withdraw my appeal from the Income‑tax Appellate Tribunal and to leave the whole to your judgment. If necessary, I am prepared to file with you a regular application under section 33‑A." This letter was replied to by the Commissioner, vide Annexure "H" dated April 2, 1960. The ultimate paragraph thereof relates to the present case and reads: "In respect of the gift‑tax matter dealt with in paragraphs 5, 6 and 7, I have also to state that as the matter is sub judice, it is not fair for me to give opinion on the merits of the case. However, I had given my viewpoint to your representatives who had attended before me in respect to the request for keeping the tax in abeyance till the appeal decision. If a revision petition is field under section 33‑A (2) of the Act, 1 shall certainly decide the same on merits as I deem justified." The reference to section 33‑A (2) of he Act in the letter, obviously, is to the Income‑tax Act of 1922. The corresponding provision under the Gift‑tax Act is section 24 (1). On the 3rd May 1960, the petitioner made an application to the Tribunal for withdrawing the appeal. This application was in these words: "The applicant has filed with the Commissioner of Gift‑tax, U. P., Lucknow, a revision application under section 21 of the Gift‑tax Act, 1958. The applicant, therefore, prays that the appeal quoted above be treated as withdrawn." Apparently, on the same date that this application was made a revision was also filed under section 24 (1) of the Gift‑tax Act before the Commissioner. The Tribunal by its order dated 29th June, 1960, granted the application to withdraw the appeal and dismissed the appeal as withdrawn. On the 12th of September, 1960, the Commissioner of Income‑tax, contrary to the assurance given, that he would dispose of the revision, if filed, on the merits as he deems justified, dismissed the revision in limine, holding that as an appeal had been filed to the Tribunal, no revision lay. Aggrieved by that order the present writ petition has been filed. The question which falls for consideration in this case is whether an appeal filed to the Tribunal but permitted to be withdrawn, can be said to have formed the subject of an appeal within the meaning of proviso (b) to section 24 (a) (1) of the Gift‑tax Act, which is almost in pari materia with proviso (c) to section 33‑A (2) of the Income‑tax Act, 1922. The only difference is that the word "made" after the word "been" is omitted from proviso (b) to section 24‑A (1), the relevant portion of which reads: " . . . .or has been the subject of an appeal to the Tribunal. A similar provision under the Wealth‑tax Act came up for consideration before the Bombay High Court and it was held that the words "or has been the subject of an appeal to the Tribunal" mean an effective appeal to the Tribunal and contemplate a decision on the merits by the Tribunal and not merely an abortive appeal or an appeal which has been withdrawn and no decision given on merits. The decision of the Bombay High Court is by a Division Bench and on the principle of stare decisis, particularly when the Gift‑tax Act is an all India Act, I would have followed that decision, The learned standing counsel, however, attempted to dis tinguish the Bombay case by saying that the revision to the Commissioner in the present case was filed simultaneously or earlier on the same day than the application for withdrawal before the Tribunal and, therefore, at the point of time when the revision was filed an appeal was in fact pending and had not yet been withdrawn. To my mind this technicality makes little are no difference. It is true that the revision had already been filed before the Commissioner and later on the same day an application was moved before the Tribunal for permission to withdraw that appeal. The fact that a revision has been filed was brought to the notice of the Tribunal in the very application for withdrawal. No secret was made of it and the Tribunal knowing that granted permission to withdraw the appeal. In any event on the day when the Commissioner came to decide the revision there was no appeal pend ing before the Tribunal and, therefore, rightly the Commissioner did not make any point of the fact that the revision war, filed earlier on the same day when an application for withdrawal of the appeal had not yet been moved and much less granted by the Tribunal. The Commissioner dismissed the revision in limine on the short ground that as an appeal had once been filed to the Tribunal and even if it was permitted to be withdrawn by the Tribunal his jurisdiction to entertain the revision stood irrevocably barred. The distinction sought to be drawn, is, in my judgment, a distinction without a difference. Apart from authority I would also have been inclined to hold that the assessee had a right either to have his grievance ventilated and determined on merits by the Tribunal on appeal or by the Commissioner by way of revision. The choice necessarily must be only that of the assessee and if he asks for permission to withdraw his appeal filed before the Tribunal and that permission is granted there is a clear indication that he does not want his grievance ventilated and determined by the Tribunal but by the Commissioner. That right or choice cannot be denied to him on any technical or theoretical grounds. So long as no decision has been given on the merits or even on the question of limitation by the Tribunal, the case cannot, in my judgment, be said to have formed the subject‑matter of an appeal to the Tribunal. For the reasons given above, I would direct that a writ in the nature of certiorari will issue quashing the order of the Commissioner of Income‑tax and Gift‑tax dated September 12, 1960, holding that the petitioner's application for revision under section 24 (1) of the Gift‑tax Act was incompetent and with the direction that he will entertain the revision and dispose it of in accordance with law. The writ petition is accordingly allowed with costs. Petition allowed.