1996 (7) TMI 25 - HC - Income Tax

Judgment highlights procedural irregularities in cancellation of firm registration under Income Tax Act

The judgment focused on challenges to the cancellation of registration of an assessee firm under the Income Tax Act. The Tribunal's decisions to set aside ... Appeal To Appellate Tribunal, Power Of Tribunal Issues Involved: The issues involved in this judgment relate to the cancellation of registration/continuation of registration of the assessee firm under the Income Tax Act, 1961, and the subsequent legal proceedings challenging these cancellations.Misc. Civil Case No. 60 of 1989: The case involved an application under section 256(2) of the Income Tax Act, where the Tribunal was directed to refer a question of law regarding the cancellation of registration of the assessee firm. The Tribunal's decision to set aside the order cancelling registration was challenged, leading to legal proceedings.Misc. Civil Case No. 66 of 1989: In this case, the Tribunal was questioned for setting aside the findings regarding the entity status of the assessee firm without proper grounds in the appeal. The legality of cancelling registration/continuation of registration was also disputed, highlighting procedural irregularities.Misc. Civil Case No. 61 of 1989: The issue in this case revolved around the Tribunal's decision to set aside the entire order passed by the CIT(A) without proper legal grounds, raising concerns about the validity of the Tribunal's actions.Misc. Civil Case No. 386 of 1991: This case questioned the Tribunal's decision to set aside the entire order passed by the CIT(A) without sufficient legal basis, indicating potential procedural flaws in the legal process.The judgment highlighted the importance of following proper legal procedures and grounds for appeal. The Court emphasized that appeals must adhere to the specified rules and objections outlined in the law. It was noted that the Tribunal's decisions in the mentioned cases lacked proper legal basis and were deemed to be in favor of the assessee due to procedural irregularities. The judgment concluded by granting liberty to the Department to pursue further legal remedies if permissible under the law, while ensuring the assessee's right to contest such proceedings in accordance with the law. The cases were disposed of with no orders as to costs, and counsel fees were fixed for each side. Copies of the order were to be transmitted to the Tribunal for reference and record-keeping purposes.