Depreciation claim and rehabilitation scheme issues remanded to the Tribunal for fresh adjudication

The Tribunal had not adjudicated the merits of the depreciation claim, but had decided the matter only on the view that a revised return could not enhance the value of fixed assets beyond the post-acquisition figures in the balance sheet. Because no findings were returned on the allowability of depreciation, the effect of the rehabilitation scheme, or the character of the payment represented by issue of shares, the High Court found it inappropriate to decide those questions itself. The matter was therefore remitted to the Tribunal for fresh adjudication of the appeals after hearing the parties, and the maintainability objection to the rectification proceedings was left open.

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Issues: Whether the matter should be remanded to the Tribunal for a fresh decision because the Tribunal had not adjudicated the merits of the depreciation claim.

Analysis: The Tribunal's order rested only on the view that the revised return could not enhance the value of the fixed assets beyond the post-acquisition figures shown in the balance sheet. It did not return findings on the substantive questions relating to the allowability of depreciation, the effect of the rehabilitation scheme, or the characterization of the payment represented by the issue of shares. Since those questions required a primary determination by the Tribunal, the High Court found it inappropriate to record findings on the merits in the absence of such a decision. The proceedings challenging the rectification order also did not survive once the matter was restored for fresh adjudication, and the maintainability objection was left open.

Conclusion: The matter was sent back to the Tribunal for a fresh decision on the appeals after hearing the parties.

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