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Assam Carbon Products Ltd. v. Commissioner Of Income-Tax

Gauhati High Court

Aug 26, 1996

Judgment

Subsequent
References

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Structured Summary of the Opinion (D.N. Baruah, J.)

Factual and Procedural Background

This is a reference under section 256(1) of the Income-tax Act, 1961. Two separate sets of questions have been referred to the High Court: one at the instance of the assessee and two at the instance of the Revenue.

Procedural facts and relevant background from the opinion:

The Assessing Officer (AO) levied interest under section 217(1A) for assessment years 1984-85 and 1985-86 (Rs. 4,72,888 and Rs. 7,57,820 respectively) after initiating proceedings under section 217(1A) in the course of assessment.
The Commissioner of Income-tax (Appeals) held that interest under section 217(1A) could not be imposed and allowed the appeal, deleting interest charges.
The Revenue appealed to the Income-tax Appellate Tribunal (the Tribunal). Before the Tribunal the Revenue argued that although the AO had wrongly invoked section 217(1A), interest was correctly charged and should be sustained under section 215; it urged that the order was therefore saved by section 292B of the Act and the matter should be remitted for reconsideration under the correct legal provision.
Additional factual disputes that led to revenue questions: (a) the assessee's claim that amounts already allowed under section 31 should be excluded while computing disallowance under section 37(3A) (a cancellation/disallowance computation issue involving amounts claimed for motor car running, insurance and repairs); and (b) whether an amount of Rs. 4,82,737 (Assam finance tax) paid on July 31, 1984 though the relevant previous year ended June 30, 1984, should be allowed under Explanation 2 to section 43B (which had retrospective effect from April 1, 1984).
The Commissioner of Income-tax (Appeals) had directed the AO to work out the disallowance under section 37(3A) after deducting Rs. 1,94,701 from Rs. 6,41,622; the Tribunal confirmed that order on appeal.
In relation to the Assam finance tax (Rs. 4,82,737) the Commissioner of Income-tax (Appeals) deleted the disallowance under section 43B; the Tribunal confirmed that decision. The Revenue referred two questions under section 256(1) at the instance of the Revenue.
The assessee referred a question under section 256(1) challenging whether the Tribunal was justified in restoring the matter after setting aside the CIT(A)’s order by invoking section 292B without materials, records or evidence.

Legal Issues Presented

At the instance of the assessee: Whether, under the facts and circumstances, the Tribunal was justified in restoring the matter after setting aside the order of the Commissioner of Income-tax (Appeals) invoking the provisions of section 292B without any materials, records or evidence?
At the instance of the Revenue — Question 1: Whether, on the facts and in view of sections 37(3A) and 37(3B) of the Income-tax Act, the Tribunal erred in law in holding that expenditure of the nature mentioned in section 31 was not to be taken into account in working out the disallowance under section 37(3A)?
At the instance of the Revenue — Question 2: Whether, on the facts and in view of Explanation 2 to section 43B, the Tribunal was justified in directing the AO to allow the claim for Rs. 4,82,737 if payment was found to have been made before July 31, 1984, though the previous year ended June 30, 1984?

Arguments of the Parties

Appellant (Revenue) — Arguments

The interest imposed by the AO was correctly charged; only the statutory provision was wrongly quoted (AO used section 217(1A) instead of section 215). Therefore, the Tribunal was justified in invoking section 292B to restore the matter so the AO could reconsider interest under the correct provision (section 215).
Before the Tribunal it was urged that section 215 should have been invoked; thus the order of the AO was saved by section 292B and a remand was proper. Mr. G.K. Joshi relied upon the wide powers of the Tribunal under section 254 to pass any order it thinks fit, and on the apex court decision in Hukumchand Mills Ltd. v. CIT to show the Tribunal could act on the subject-matter of the appeal.
With respect to the two questions referred by the Revenue, counsel for the Revenue submitted those questions were covered by earlier decisions of the court (as identified in the opinion), but ultimately both counsel agreed they were covered by prior decisions in favour of the assessee.

Respondent (Assessee) — Arguments

Dr. Saraf for the assessee submitted the Tribunal had no authority or jurisdiction to remand the matter for initiation of proceedings under section 215 because that was not the subject-matter of the appeal before the Tribunal; the conditions necessary for charging interest under section 215 were not before the Tribunal and had not been urged before the Commissioner of Income-tax (Appeals) or the Tribunal.
The assessee argued that the AO had levied interest under section 217(1A), that the Commissioner of Income-tax (Appeals) correctly deleted the interest after examining compliance (Form No. 29 filed), and that the Tribunal could not remand on a different basis without amendment of the memo of appeal or leave under rule 11 of the Income-tax (Appellate Tribunal) Rules, 1963.
The assessee relied on authorities (including Parashuram Pottery and Pathikonda Balasubba Setty) emphasizing the limits on remand and the need for finality; counsel argued mistakes by Revenue could not justify reopening matters so as to cause loss to the assessee or to revive stale issues without proper procedural sanction.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
George Williamson (Assam) Ltd. v. Commissioner of Income-Tax, [1997] 223 ITR 203 (Gauhati)	Cited by parties as covering the first question raised by the Revenue (relating to sections 37(3A)/37(3B) and exclusion of amounts allowed under section 31).	The court recorded that the first Revenue question was squarely covered by this decision and, after perusal, answered the question in the affirmative and in favour of the assessee.
CIT v. Bharat Bamboo and Timber Suppliers, [1996] 219 ITR 212	Cited by parties as covering the second question raised by the Revenue (relating to Explanation 2 to section 43B and payment timing).	The court recorded that the second Revenue question was squarely covered by this decision and, after perusal, answered the question in the affirmative and in favour of the assessee.
Hukumchand Mills Ltd. v. CIT, [1967] 63 ITR 232 (Apex Court)	Authority for the proposition that the Tribunal may pass any order in respect of an appeal on the subject-matter arising thereon, subject to the restriction that the expression “thereon” limits jurisdiction to the subject-matter of the appeal.	Relied on by Revenue's counsel (Mr. Joshi) to support the Tribunal's competence to remand for reconsideration under section 215. The court considered the principle in assessing the Tribunal’s powers but also noted the subject-matter limitation.
Parashuram Pottery Works Co. Ltd. v. HO, [1977] 106 ITR 1 (SC)	Quoted for the policy that tax authorities must be diligent and that mistakes by authorities can result in loss to revenue; also cited in the context of finality of litigation.	Counsel for the assessee brought this decision to attention; the court recorded the passage and considered it in the context of the Revenue's argument about mistakes and remediation, noting the need for finality but also the Tribunal's power under section 292B in appropriate cases.
Pathikonda Balasubba Setty v. CIT, [1967] 65 ITR 252 (Mys)	Explains that the Tribunal's powers are limited to the subject-matter of the appeal; remand powers should be used sparingly and only where further evidence or clearer findings are necessary; parties are under a duty to place evidence before the original authority.	Relied upon by the assessee to argue limitation on remand and enhancement; the court discussed these constraints and observed that while remand powers are limited, the Tribunal may, in certain circumstances and with leave, permit new grounds; the court applied the principles to determine whether the Tribunal's remand was justified and ultimately remanded to the Tribunal for further consideration because reasons for invoking section 215 had not been provided by the Tribunal.

Court's Reasoning and Analysis

The court's analysis proceeded along these principal lines (faithful to the opinion text):

Statutory comparison of sections 217(1A) and 215:
- Section 217(1A) applies where a person required to send an estimate under specified provisions has not sent the estimate; it prescribes simple interest at 15% per annum from the 1st day of April next following the financial year up to the date of regular assessment on the shortfall of advance tax.
- Section 215 applies where advance tax paid is a specified proportion (e.g., less than 83.33% in case of a company or 75% in other cases) of the tax assessed in the regular assessment; it presupposes a regular assessment and a particular relationship between advance tax paid and assessed tax.
- The court noted that the pre-requisite conditions under sections 215 and 217(1A) are widely different, so invoking section 215 requires establishing specific conditions that were not necessarily before the Tribunal.
Examination of the factual record and appellate pleadings:
- The AO had levied interest under section 217(1A); the CIT(A) after examining facts (including that Form No. 29 had been filed) held section 217(1A) inapplicable and deleted the interest.
- The memorandum of appeal filed by the Revenue to the Tribunal attacked the cancellation under section 217(1A); there was no written amendment on record substituting or adding section 215 as a ground in the memo of appeal, nor a formal supplementary ground.
- However, the Tribunal heard the matter and, on the record, allowed the Revenue’s representative to urge that section 215 should apply. The court observed that leave to urge additional grounds under rule 11 of the Income-tax (Appellate Tribunal) Rules need not be in writing and may be granted orally; thus the Tribunal may permissibly have allowed the point to be urged.
On the Tribunal's use of section 292B and remand:
- The Tribunal invoked section 292B and restored the matter to the AO for reconsideration, after setting aside the CIT(A)’s order. The Tribunal's order observed that in view of section 292B the matter should be reconsidered by the AO.
- The court examined whether the Tribunal gave reasons for invoking section 215 and found that the Tribunal did not discuss or give reasons as to why section 215 should be invoked in the facts and circumstances of the case.
- Because the Tribunal did not state reasons or make findings establishing the existence of the conditions necessary for invoking section 215, the High Court considered it difficult to answer the assessee’s referred question on whether the Tribunal was justified in remanding the matter without materials or evidence supporting the applicability of section 215.
Application of rule 11 and appellate competence:
- The court considered rule 11 of the Income-tax (Appellate Tribunal) Rules, 1963 (grounds not set forth in memo of appeal may not be urged except by leave of the Tribunal; the Tribunal is not confined to the grounds in the memo but shall not rest its decision on other grounds unless affected parties have had opportunity to be heard).
- The court noted it was possible the Tribunal permitted the Revenue (or its representative) to press the section 215 point orally and that, on the record, the Tribunal allowed argument on that basis; therefore the court could not criticise the Tribunal for taking recourse to section 292B in principle, but it faulted the Tribunal for failing to state reasons and to determine whether conditions for section 215 existed.
On precedents and answering the Revenue's referred questions:
- Both parties agreed that the two specific questions referred by the Revenue were covered by two earlier decisions of the court—George Williamson and Bharat Bamboo & Timber Suppliers—and having perused these decisions the court answered both the Revenue's questions in the affirmative and in favour of the assessee.
Disposition as to the assessee's reference:
- Because the Tribunal did not state reasons or findings to justify invoking section 215 (and no clear material demonstrating the conditions for section 215 were placed on record by the Tribunal), the High Court found it could not properly answer the assessee’s referred question on whether the Tribunal was justified in remanding without materials.
- Therefore, rather than deciding that question, the High Court remanded the matter to the Tribunal to consider the question afresh: the Tribunal is to determine whether the conditions necessary for invoking section 215 of the Act exist and, if they do, the Tribunal may decide the issue itself applying section 292B. The court directed the Tribunal to give appropriate reasons and to come to a definite conclusion.

Holding and Implications

Holding (core rulings):

On the two questions referred at the instance of the Revenue: Both questions were answered in the affirmative and in favour of the assessee and against the Revenue (the court accepted the parties' submission that these questions were covered by earlier decisions and recorded answers accordingly).
On the question referred at the instance of the assessee: The court did not answer the question directly but remanded the matter to the Tribunal to consider afresh whether the conditions necessary to invoke section 215 are present and, if so, to decide the matter itself applying section 292B; the court found the Tribunal had not given reasons for invoking section 215 and so a fresh consideration was necessary.

Practical consequences and implications:

Direct effect on the parties: The Revenue's two referred questions were decided in favour of the assessee; the Tribunal's remand (as to interest) is subject to further consideration by the Tribunal regarding the applicability of section 215. The AO's original levying of interest under section 217(1A) had been deleted by the CIT(A); the Tribunal's remand is to be reconsidered with reasons if section 215 is to be invoked.
The court did not itself make a conclusive determination about whether the Tribunal was justified in remanding the matter on the section 215 point (it remitted that issue to the Tribunal for fresh consideration because of the absence of reasons and supporting material in the Tribunal's order).
The opinion records reliance on prior authorities for the Revenue questions and therefore does not purport to lay down a new principle of law — the decision follows existing precedents and remits the procedural issue to the Tribunal for fact-finding and reasoned conclusion.

Note: This summary contains only information expressly contained in the provided opinion and does not add or infer facts or legal conclusions beyond the text of that opinion.

Show all summary ...

D.N Baruah, J.:— In this reference under section 256(1) of the Income-tax Act, 1961 (for short, “the Act”), the Tribunal has referred the following common question at the instance of the assessee for opinion of this court:

“1. Whether, under the facts and circumstances of the case, the Tribunal was justified in restoring back the matter after setting aside the order of the learned Commissioner of Income-tax (Appeals) invoking the provisions of section 292B without any materials, records or evidence?”

2. The following two questions have been referred to this court under section 256(1) of the Act (for short, “the Act”) at the instance of the Revenue:

“1. Whether, on the facts and in the circumstances of the case and in view of the provisions of sections 37(3A) and 37(3B) of the Income-tax Act, 1961, the Tribunal has not erred in law in holding that expenditure of the nature mentioned in section 31 was not to be taken into account in working out the disallowance under section 37(3A) of the Income-tax Act, 1961?

2. Whether, on the facts and in the circumstances of the case and in view of the Explanation 2 to section 43B of the Income-tax Act, 1961, the Tribunal was justified in law in directing the Assessing Officer to allow the claim for the amount of Rs. 4,82,737, if the payment was found to have been made before July 31, 1984, though the relevant previous year ended on June 30, 1984?”

3. The facts for answering the above questions are:

The assessee is a company incorporated under the Companies Act. The Assessing Officer initiated proceedings under section 217(1A) in the course of the assessment proceedings for the assessment years 1984-85 and 1985-86 and levied interest amounting to Rs. 4,72,888 and Rs. 7,57,820, respectively. On appeal before the Commissioner of Income-tax (Appeals), he after hearing the parties held that no interest could be imposed under section 217(1A) and allowed the appeal. The Revenue took up the matter before the Income-tax Appellate Tribunal by way of an appeal. Before the Tribunal it urged that the interest was correctly charged by the Assessing Officer, only the section had been wrongly referred to and therefore, interest levied ought to be sustained under section 215 inasmuch as in the facts and circumstances, it would indicate that it was charged by the Assessing Officer only under that section. It was, therefore, submitted that the order of the Assessing Officer was covered by the provisions of section 292B of the Act.

Regarding the first question raised by the Revenue, the facts are that the assessee made an expenditure of Rs. 6,41,332 on running of motor car, etc., and it was claimed before the Assessing Officer that an amount of Rs. 1,911,701 was spent towards insurance and current repairs of the motor car which was already allowed as deduction under section 31 of the Act and as such this amount ought to be excluded while working out of the disallowance under section 37(3A) of the Act. The Assessing Officer did not agree with the above contentions of the assessee.

4. The assessee, therefore, preferred appeal before the Commissioner of Income-tax (Appeals) who directed the Assessing Officer to work out the disallowance under section 37(3A) after deducting Rs. 1,94,701 from Rs. 6,41,622. On further appeal preferred before the Income-tax Appellate Tribunal by the Revenue, the order of the Commissioner of Income-tax (Appeals) was confirmed. As regards the second question referred at the instance of the Revenue, the facts are that in the relevant previous year of the assessee-company ended on June 30, 1984, an amount of Rs. 4,82,737 remained outstanding on account of Assam finance tax for the previous year. This amount was paid on July 31, 1984. As the amount was not paid within time, the Assessing Officer disallowed the same following the provisions of section 43B read with Explanation 2 to the said section which was inserted by the Finance Act, 1989, with retrospective effect from April 1, 1984. Being aggrieved by the order, of the Assessing Officer, the assessee approached the Commissioner of Income-tax (Appeals). The Commissioner of Income-tax (Appeals) deleted the disallowance of Rs. 4,82,737 under section 43B. The Department not) being satisfied preferred appeal before the Tribunal and the Tribunal [also confirmed the decision of the Commissioner of Income-tax (Appeals). Hence, the present reference.

5. Heard Mr. G.K Joshi, learned senior standing counsel appearing for the Revenue, and Dr. Saraf, learned counsel on behalf of the assessee. Learned counsel for the parties submit that the two questions referred at the instance of the Revenue are squarely covered by two decisions of this court. The first question is covered by decision in I.T.R No. 9 of 1994— George Williamson (Assam) Ltd. v. Commissioner Of Income-Tax, [1997] 223 ITR 203 (Gauhati), decided on August 21, 1996, and the second question is covered by another decision of this court in CIT v. Bharat Bamboo and Timber Suppliers, [1996] 219 ITR 212. As per the decisions referred to above learned counsel for the parties submit that both the questions may be answered in the affirmative and in favour of the assessee. We have perused the decisions. Considering the submission of learned counsel appearing on behalf of the parties, we answer both the questions referred at the instance of the Revenue, in the affirmative and in favour of the assessee and against the Revenue.

6. We have also heard regarding the question referred at the instance of the assessee. Dr. Saraf, learned counsel for the assessee, submits that the Tribunal had no authority and jurisdiction to remand the matter for initiation of a proceeding under section 215 of the Act for charging interest inasmuch as this was not the subject-matter of the appeal before the Tribunal. Dr. Saraf also submits that the necessary conditions for charging interest under section 215 of the Act were not before the Tribunal and in fact, this aspect of the matter was not urged either before the Commissioner of Income-tax (Appeals) or before the Tribunal. Learned counsel also submits that before the Tribunal, the Revenue took up the ground that the Commissioner of Income-tax (Appeals) was wrong in holding that charging of interest under section 217(1A) was bad in law. In fact, the Assessing Officer after the assessment was made on regular basis levied interest under section 217(1A). The Commissioner of Income-tax (Appeals) after considering the entire aspects of the matter, came to the conclusion that the provision of section 217(1A) would not be attracted and accordingly deleted the interest. That being the position, the Tribunal had no jurisdiction to remand the matter to the Assessing Officer with a direction to reconsider levying of interest under section 215. Before the Tribunal, Dr. Saraf submits that this was not the subject-matter of the appeal. On the other hand, Mr. Joshi strenuously urges that in the facts and circumstances of the case, the Tribunal was justified in remanding the matter. He, however, very candidly submits before us that the matter was not raised before the Commissioner of Income-tax (Appeals). Mr. Joshi further submits that the statement of facts and the annexures, namely, the assessment order, should be looked into by this court while answering the question whether in the facts and circumstances of the case, the Tribunal was justified in remanding the matter. For mere wrong quoting of the section, the court should not throw away the legitimate rights of the Department as the Department will suffer a great loss.

7. On the above submission of the parties it is to be seen as to whether the Tribunal was justified in remanding the matter for initiation of the proceeding under section 215 of the Act for charging the interest since the Assessing Officer passed the order for interest under section 217(1A) which was challenged before the Commissioner of Income-tax (Appeals).

8. Section 217(1A) of the Act provides that interest will be payable by the assessee when no estimate is made. The section provides that if the Assessing Officer finds that any person who is required to send an estimate under sub-section (4) of section 209A or any such person as is referred to in subjection (3A) of section 212 has not sent the estimate referred to therein, simple interest at the rate of fifteen per cent, per annum from the 1st day of April next following the financial year in which the advance tax was payable in accordance with the said sub-section (4) or as the case may be, sub-section (3A) up to the date of the regular assessment, shall be payablle by the assessee upon the amount by which the advance tax paid by h|im falls short of the assessed tax as defined in sub-section (5) of section) 215.

9. Section 215, however, makes provision for levying interest in case the advance tax is paid 83.33 per cent, in case of company and 75 per cent, in other oases less than the tax assessed in regular assessment. It is true that the requirement of conditions under section 215 and under section 217(1A) are widely different. The pre-requisite conditions under section 215 is that there must be a regular assessment and that taxes paid are less than 75 per cent, of the tax assessed. In order to invoke the power under section 215, the authority must first consider that the advance tax is paid at least less than 75 per cent, of the tax assessed. In the instant case, the Assessing Officer simply levied interest invoking the powers under section 217(1;A). From the facts, it is found that the appellate authority, namely, the Commissioner of Income-tax (Appeals), has rightly set aside the order of the Assessing Officer levying interest under the said section 217(1A). Mr. Joshil submits before us that it was for the first appellate court to consider the future action to be taken after setting aside the appeal. The Commissioner of Income-tax (Appeals) in his order observed as follows:

“In ground No. 9, it was stated that interest under section 217(1A) aggregating to Rs. 4,72,866 was wrongly charged because the same was chargeable only when no estimate in Form No. 29 was filed. It is to be seen that the appellant did file Form No. 29 for the assessment year 1984-85 on June 15, 1983, vide acknowledgment receipt No. 927312 and, therefore, he maad the compliance of the aforesaid section and there was no question of levying of interest under section 217(1A). I have gone through the above section and noted that interest was chargeable only when no estimate was filed and, therefore, the Inspecting Assistant Commissioner (Assessment) was incorrect in charging interest and therefore he is directed to delete the interest of Rs. 4,72,866.”

10. The Revenue preferred appeal before the Tribunal raising the following ground:

“The Commissioner of Income-tax (Appeals) is not justified in cancelling the charge under section 217(1A) amounting to Rs. 4,72,866.”

11. This was in respect of the assessment year 1984-85. A similar ground was taken in respect of the next assessment year 1985-86. From the memo of appeal, it is clear that the intention of the Revenue was that the Commissioner of Income-tax (Appeals) was justified in levying interest under section 217(1A). There is nothing on record to show that at the time of hearing or prior to the hearing any amendment was made in so far as the memo of appeals were concerned. Besides, as submitted by Dr. Saraf, at least the records do not indicate the same. Mr. Joshi submits that the power of the Income-tax Appellate Tribunal is wide enough to pass any order. As per section 254, the Appellate Tribunal may, after giving an opportunity of hearing, pass such order thereon as it thinks fit. Relying on this, Mr. Joshi submits that it was open for the Tribunal that when it noticed that section 217(1A) was not applicable, in the facts and circumstances and the intention was to proceed under section 215, no fault can be found in the order of the Tribunal. In this connection, Mr. Joshi has drawn our attention to a decision of the apex court reported in Hukumchand Mills Ltd. v. CIT, [1967] 63 ITR 232. In the said decision, the apex court held that the Tribunal could pass any order in respect of an appeal on the subject-matter arising thereon. The apex court also observed the expression “thereon” restricts the jurisdiction to the subject-matter of the appeal. Taking the support of the decision, Mr. Joshi submits that the subject-matter was before the Tribunal and, therefore, the Tribunal was fully competent to remand the matter. Dr. Saraf, however, refutes the said submission of Mr. Joshi and submits that in the facts and circumstances of the case, the Tribunal was not justified in remanding the case, because, the subject-matter before the Tribunal was altogether different as the conditions necessary for levy of interest under section 215 of the Act were absolutely absent before the Tribunal and, therefore, it cannot be said that the Tribunal could pass such an order. Mr. Joshi having seen the memo of appeal, on the other hand, finds it difficult to support the memo of appeal. However, he submits before us that there may be some mistake on the part of the Revenue and for that the Revenue should not be made to suffer. Dr. Saraf, however, contends that the Revenue cannot take the plea of mistake at this stage. Mr. Joshi also submits that as there was an apparent mistake in quoting the section, section 292B is applicable. In this connection, learned counsel for the assessee has brought to our notice to a decision in Parashuram Pottery Works. Co. Ltd. v. HO, [1977] 106 ITR 1 (SC). In the said decision, the apex court held thus (at page 10):

“It has been said that the taxes are the price that we pay for civilization. If so, it is essential that those who are entrusted with the task of calculating and realising that price should familiarise themselves with the relevant provisions and become well-versed with the law on the subject. Any remissness on their part can only be at the cost of the national exchequer and must necessarily result in loss of revenue. At the same time, we have to bear in mind that the policy of law is that there must be a point of finality in all legal proceedings, that stale issues should not be reactivated beyond a particular stage and that lapse of time must induce repose in and set at rest judicial and quasi-judicial controversies as it must in other spheres of human activity.”

12. Dr. Saraf also drew our attention to a decision in Pathikonda Balasubba Setty v. CIT, [1967] 65 ITR 252 (Mys). In the said decision, the Mysore High Court observed as under (at page 257):

“The effect of these provisions is that the Appellate Tribunal's powers are limited to passing such orders as they may think fit on the appeal. T the expression ‘on the appeal’ clearly and indubitably points to the conclusion that the powers of the appellate authority, the Tribunal, are limited to the subject-matter of the appeal.

At the next stage of second appeal to the Appellate Tribunal, the liberty is given to both the sides to go up in appeal to the Appellate Tribunal and when the Appellate Tribunal comes to deal with the matter, the law regards it sufficient to leave it to the parties going up as appellants before the Tribunal to limit their attack on the order of the first appellate authority and to seek the intervention of the Tribunal only to the extent necessary to correct the errors in the order of the Appellate Assistant Com-missioner according to the case of the appellant.”

13. It was further observed by the Mysore High Court as under (at page 258):

“Uniform judicial interpretation placed on these powers is that the power of remand should be used sparingly and ordinarily only in cases where the appellate authority, after an examination of the material already placed on record by way of evidence, takes the view that it is not possible for it to make a just order on the appeal without the assistance of further evidence or without the assistance of a clearer finding by the authority from whose order the appeal has been presented. That implied limitation on the power of remand is directly related to the principle of justice that parties interested in obtaining an order from a court or Tribunal are under a duty to place before the original authority all the evidence on which they rely for obtaining the relief they seek.”

14. Dr. Saraf further relying on the aforesaid decision submits that the Tribunal had no power to enhance the assessment. We have no dispute that the Tribunal had no power of enhancement but that does not mean that an order which is set aside by the first appellate court, cannot be restored back. That cannot be said to be enhancement of assessment. We do not agree with the aforesaid submission of Dr. Saraf. It is true as submitted by Mr. Joshi that in case of any mistake or error, the Tribunal has the power to take recourse of section 292B. At the time of argument, it has been urged before the Tribunal by the representative of the Revenue that in fact the provision of section 215 ought to have been invoked. We do not find any amendment of the memo of appeal or any supplementary ground of appeal. Counsel for the petitioner submits that without amendment of the memo of appeal, without taking leave of the Tribunal to urge additional grounds as per rule 11 of the Income-tax (Appellate Tribunal) Rules, 1963, the Revenue cannot urge a new point altogether which was not before the Tribunal. rule 11 of the Income-tax (Appellate Tribunal) Rules, 1963, provides as under:

“Grounds which may be taken in appeal.— The appellant shall not, except by leave of the Tribunal, urge or be heard in support of any ground not set forth in the memorandum of appeal, but the Tribunal, in deciding the appeal, shall not be confined to the grounds set forth in the memorandum of appeal or taken by leave of the Tribunal under this rule:

Provided that the Tribunal shall not rest its decision on any other ground unless the party who may be affected thereby has had a sufficient opportunity of being heard on that ground.”

15. As per rule 11 of the Income-tax (Appellate Tribunal) Rules, 1963, the appellant is not competent to urge any ground which is not taken in the memo of appeal except with the leave of the court. Leave need not be sought for in writing. If this is so, we feel that the Revenue might have amended the grounds by taking leave of the Tribunal orally. It is clear from the record that the Tribunal heard the matter and allowed the representative of the Revenue to urge the point. Therefore, in our view, the matter before the Tribunal was rather section 217(1A) than section 215. Therefore, we cannot find fault with the Tribunal in invoking the power to amend the section. However, the Tribunal did not discuss and give any reason as to why in the facts and circumstances of the case, power under section 215 should be invoked. The Tribunal in the last paragraph 13 has observed thus:

“After careful consideration of the entire facts and circumstances of the case and in view of the provisions of section 292B of the Act, we consider that the matter is to be reconsidered by the Assessing Officer and as such, we restore back the matter to him after setting aside the order of the learned Commissioner of Income-tax (Appeals).”

16. Therefore, in our opinion, the matter requires to be reconsidered by the Assessing Officer. No reason have been given and as such it is difficult for this court to give a proper answer to these questions. The Tribunal may decide the matter itself and may come to a definite conclusion and thereafter if necessary may pass any appropriate order.

17. In view of the above, without answering the question, we remand the matter to the Tribunal to consider the matter afresh and to decide as to the existence of the conditions necessary for invoking the section 215 of the Act and if there are such conditions, the Tribunal may decide the same itself applying section 292B.