Merger doctrine and review orders: appeal amended to challenge both orders, with fresh adjudication permitted.

The principle of merger was held not to apply strictly where the review power under Rule 25 of the U.P. Trade Tax Rules, 1948 involved a substantive reconsideration of facts and law after hearing the assessee. An appeal confined to the original exemption rejection was treated as defective because the unchallenged review order would remain on record and create conflicting orders. The Tribunal's view that both orders had to be challenged was sustained, but the final dismissal was set aside in the interests of substantial justice, and the assessee was allowed to amend the appeal and seek fresh adjudication.

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Issues: (i) Whether the principle of merger barred the appeal where the order on review under Rule 25 of the U.P. Trade Tax Rules, 1948 had not been challenged; (ii) Whether the appeal against rejection of exemption could proceed without also challenging the review order, and what relief should follow.

Issue (i): Whether the principle of merger barred the appeal where the order on review under Rule 25 of the U.P. Trade Tax Rules, 1948 had not been challenged.

Analysis: The review power under Rule 25 is wide and amounts to reconsideration of the matter on facts and law after hearing the unit and examining relevant records. For that reason, the ordinary principle of merger was held not to be strictly applicable in the same manner as in an appellate hierarchy.

Conclusion: The merger objection was not accepted as the decisive ground to non-suit the assessee.

Issue (ii): Whether the appeal against rejection of exemption could proceed without also challenging the review order, and what relief should follow.

Analysis: The review order was a reasoned order passed after hearing and cured the earlier defect complained of by the assessee. Leaving that order unchallenged would create conflicting orders on record if the original rejection alone were interfered with. The proper course, therefore, was to require challenge to the review order as well. At the same time, the matter had not been decided on merits by the Tribunal, and the interests of substantial justice justified affording an opportunity to amend the appeal rather than terminating the matter finally on a technicality.

Conclusion: The Tribunal's view that the review order also had to be challenged was upheld, but the final dismissal was set aside and the assessee was granted an opportunity to amend the appeal and obtain fresh adjudication.

Final Conclusion: The revision resulted in partial relief to the assessee: the procedural reasoning of the Tribunal was sustained, but the matter was sent back for amendment and fresh decision on the appeal against both orders.

Ratio Decidendi: Where a review order is a substantive reasoned decision after hearing, an appeal challenging only the original order may be defective if it would leave conflicting orders on record; the court may protect substantial justice by permitting amendment and fresh adjudication instead of terminating the matter on a technical objection.

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