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2008 DIGILAW 413 (MP)

Kewalchand Kailashchand Jain (Huf) v. CWT

2008-03-13

DIPAK MISRA, R.S.JHA

body2008
JUDGMENT 1. The present appeal preferred under Section 27A of the Wealth Tax Act, 1957 (for brevity 'the Act') was admitted on the following substantial question of law: Whether on the facts and circumstances of the case, the Tribunal was right in rejecting the appellant's claim of complete partition under Section 20 of the Wealth Tax Act ? 2. The essential facts which need to be exposited for appreciating the grounds urged in the appeal are that the petitioner was assessed to wealth-tax by the Asstt. CWT under Section 17 of the Act and the said authority rejected the stand of the assessee petitioner that there has been complete partition of the HUF and hence, there could be no liability of wealth-tax. Be it noted, it was pleaded before the assessing officer that the HUF had become instinct and, therefore, no tax could be imposed. The assessing officer came to hold that there had been partition but it did not have nature and character of complete partition to get the benefit as engrafted under Section 20 of the Act. The assessing officer placed reliance on the decision rendered in Kalloomal Tapeswari Prasad (HUF) v. [1982] 133 ITR 690 (SC) and came to hold that as there has been partial partition the provision contained in Section 20A of the Act will not get attracted. 3. Being aggrieved by and dissatisfied with the aforesaid order the assessee-appellant preferred an appeal before the Commissioner (Appeals) who analysing the facts in detail expressed the opinion that there has been a complete partition. Being of this view the first appellate authority directed the assessing officer to proceed with the matter on the foundation that there had been complete partition. 4. The aforesaid order was challenged by the revenue before the Tribunal and the Tribunal after referring to the legal position in para 4 stated thus: 4. We have carefully gone through the orders, of the authorities below as well as the judgment of Hon'ble Supreme Court in the case of Kalloomal Tapeshwari Prasad (supra) and looking to the facts narrated by authorities below which are not disputed, we, are of the opinion that Commissioner of Wealth Tax (Appals) is not at all justified in sending matter back to the assessing officer. At the most, there is a partial partition and as per provisions contained in Section 20A of the Wealth Tax Act, we are of the opinion that family is liable to be assessed under the Wealth Tax Act if no such partial partition has taken place. We, therefore, hereby set aside the impugned order of learned Commissioner of Wealth Tax (Appals) and restore the order of the assessing officer under Section , dt 27-3-1996. The appeal of the revenue is accordingly allowed. 5. Questioning the correctness of the aforesaid order, it is submitted by Mr. H.S. Shrivastava, learned senior counsel, being assisted by Mr. Oswal for the assessee, appellant that the Tribunal being the final factfinding authority could not have dealt with the matter in a mechanical and superficial manner as it has done. The learned senior counsel further submitted that the Tribunal should have apprised itself that the Commissioner of Wealth Tax (Appals) has dislodged the finding of the assessing officer and when the Tribunal was passing an order of reversal, it was incumbent on its part to ascribe cogent and germane reasons on scanning of facts that there had been incomplete partition instead of complete partition. The learned Counsel further submitted that the Tribunal has rejected the claim of complete partition without factual analysis and, therefore, the same involves a substantial question of law inasmuch as when a Tribunal which is vested with jurisdiction to act in a particular manner and it does not carry out statutory responsibility the same gives rise to a substantial question of law. 6. Mr. Rohit Arya, learned senior counsel along with Mr. Sanjay Lal, appearing for the revenue, supported the order passed by the Tribunal. 7. We have carefully perused the order passed by the Tribunal, On a bare perusal of para 4 of the order by which the Tribunal has composed its reasoning, by no stretch of imagination, can be interpretive of the fact that there has been any kind of advertence to the facts in issue. The Tribunal has only stated that at the most there is a partial partition. We really fail to fathom that on what basis the Tribunal has come to such a conclusion and on what ground it has reversed the finding of the Commissioner of Wealth Tax (Appals). The Tribunal has only stated that at the most there is a partial partition. We really fail to fathom that on what basis the Tribunal has come to such a conclusion and on what ground it has reversed the finding of the Commissioner of Wealth Tax (Appals). It is trite law that the Tribunal is the highest fact finding authority and, therefore, it has to discharge its obligation while it reverses a factual order more so, when the assessee had suffered. 8. In view of the aforesaid, we set aside the order passed by the Tribunal on 18-2-2000, Annexure A/8, and direct to remit it for proper adjudication as per law. Needless to emphasize when this Court has directed remit of the case as there has been no discussion by the Tribunal with regard to factual matrix, there has been no expression of opinion on the merits of the case. 9. In the result, the appeal stands allowed. There shall be no order as to costs.