Doctrine of merger does not apply where an appeal is summarily rejected for non-compliance with a precondition.

A summary rejection of a second appeal for failure to satisfy a preliminary pre-condition, such as payment of tax, is not a disposal on merits. In that situation, the appellate authority does not adjudicate the appeal or confirm the earlier order on merits, so the doctrine of merger does not operate as it would after substantive appellate determination. The earlier first appellate order therefore does not become immune from revision on that basis, and the Commissioner may still entertain a revision application unless another exception applies. The Commissioner's refusal to hear the revision was accordingly incorrect, and the matter was to be considered on merits.

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Issues: Whether a summary rejection of the assessee's second appeal for non-payment of tax caused the first appellate order to merge in the second appellate order so as to bar a revision application before the Commissioner.

Analysis: The relevant revision provisions empowered the Commissioner to revise orders subject to specified exceptions. The crucial question was whether a summary rejection of an appeal for non-compliance with a pre-condition to hearing amounted to disposal on merits. The Court held that where an appeal is rejected summarily for failure to comply with a preliminary requirement, the appellate authority does not hear or decide the appeal on merits. Such rejection is analogous to rejection of a memorandum of appeal for want of court-fee or similar default, and it does not amount to confirmation of the order appealed from on merits. The doctrine of merger therefore does not apply in the same way as it would where an appellate authority has actually adjudicated the appeal.

Conclusion: The summary rejection of the second appeal did not bar the revision application, and the Commissioner's refusal to entertain it was incorrect. The petition succeeded and the matter was directed to be heard on merits.

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