AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2018 (6) TMI 1833
X X X X Extracts X X X X
X X X X Extracts X X X X
....e right to accumulation extends to the deemed income also. 3. Learned representatives fairly agree that the short question which requires tot be adjudicated in this case is whether or not, for the purpose of computing benefit of accumulation under section 11, deemed income under section 11(1B) is to be taken into account, and that, if this question is decided in favour of the assessee i.e. holding that deemed income is also be included for the said purpose, nothing survives for further adjudication by us. The Assessing Officer has decided this question against the assessee by relying upon a decision of this Tribunal in the case of B N Gamadia Parsi Hunnarshala Vs ADIT [(2002) 77 TTJ 274 (Mum)]. The Assessing Officer did refer to a judgment of Hon'ble Bombay High Court in the case of CIT Vs Thana Electricity Supply Co Ltd [(1994) 206 ITR 727 (Bom)] but then this decision has nothing to do with the issue in question. In appeal, the action of the Assessing Officer has been confirmed in principle, though the quantum of addition stood modified- an aspect which is not, for the present purposes, really relevant. The assessee is not satisfied with the order of the CIT(A) as well and is in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he case of Nawal Kishore & Sons Jewellers (87 ITD SB 407) and the Special Bench has decided the issue against the assessee. We are thus urged to follow the Special Bench decision of the Tribunal in the case of Nawal Kishore & Sons (supra) and thus dismiss this preliminary issue raised by the assessee. 4. Having given our careful consideration to the rival submissions, we are inclined to uphold the objection taken by the assessee. 5. As observed by a Co-ordinate Bench of this Tribunal, in the case of Tej International (P.) Ltd. v. DCIT (69 TTJ 650), in the hierarchical judicial system that we have in India, the wisdom of the court below has to yield to the higher wisdom of the court above and, therefore, once an authority higher than this Tribunal has expressed its esteemed views on an issue, normally the decision of the higher judicial authority is to be followed. The Bench has further held that the fact that the judgment of the higher judicial forum is from a nonjurisdictional High Court does not really alter this position, as laid down by the Hon'ble Bombay High Court in the case of CIT v. Godavari Devi Saraf ( 113 ITR 589). For slightly different reasons and alongwith so....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s case (supra), which was delivered by a Division Bench of equal strength of this very Hon'ble High Court, Their Lordships took note of revenue's stand as follows : "Referring to the observations of Godavari Devi (supra), that an all India Tribunal acting anywhere should follow the decisions of any other High Court on the point, it was submitted by the counsel of the revenue that this observation itself would show that the High Court was aware of the fact that different High Courts were not bound by the decisions of each other and, as such, there may be contrary decisions of different High Courts on the same point." 9. The issue of consideration was thus confined to the question whether or not a High Court decision is binding on another High Court or not. That admittedly was the core issue decided by Their Lordships. As for the binding nature of nonjurisdictional High Court decisions on the Tribunal, the observations made by Their Lordships were no more than obiter dictum and in this very judgment, Their Lordships have held that even in the case of Hon'ble Supreme Court judgments, which are binding on all Courts, except Supreme Court itself, but 'what is binding....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the footing that section 140A(3) was non existent, the order of penalty under that section cannot be imposed by any authority under the Act. Until a contrary decision is given by any other competent High Court, which is binding on the Tribunal in the State of Bombay (as it then was), it has to proceed on the footing that the law declared by the High Court, though of another State, is the final law of the land .......... an authority like Tribunal has to respect the law laid down by the High Court, though of a different State, so long as there is no contrary decision on that issue by any other High Court ....." 13. It is thus clear that while the issue before the Hon'ble High Court in Thana Electricity Co. Ltd.'s case (supra) was whether or not a High Court should follow another High Court, whereas in Godavari Devi Saraf's case (supra), Their Lordships dealt with the issue whether or not a non-jurisdictional High Court is to be followed by a Bench of the Income-tax Appellate Tribunal. To that extent, and irrespective of some casual observations on the applicability of nonjurisdictional High Court judgments on subordinate courts and Tribunals, these two decisions deal i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....) Ltd. (supra), our reasons are not exactly the same as adopted by our distinguished colleagues. 6. Yet, the coordinate bench, in the case of B N Gamadia Parsi Hunnarshala Vs ADIT (supra), decided not only to ignore this binding precedent but also had the audacity to hold that it was an incorrect decision. The coordinate bench went to the extent of observing that "We are unable to persuade ourselves to agree with the view taken by the Hon'ble Calcutta High Court (cited supra). A careful perusal of the language employed in section 11 of the Act makes it crystal clear that exemption is available only on the 'income (within the meaning of section 11 and not on the 'deemed income'). Consequently, the assessee cannot accumulate deemed income either under section 11(1)(a) or 11(2) of the Act". Much as we would like to refrain from commenting upon a coordinate bench decision, we cannot help quoting from the decision of the Hon'ble Supreme Court in the case of Asstt. Collector of Central Excise v. Dunlop India Ltd. [(1985) 154 ITR 172 (SC)] in which Hon'ble Supreme Court itself has quoted from the decision of House of Lords as under: "We desire to add and as was said in Cassell & Co. Lt....