COMMISSIONER OF INCOME TAX, MADRAS versus S. CHENNIAPPA MUDALIAR, MADURAI

Citation: [1969] 3 S.C.R. 818 · Decided: 24-02-1969 · Supreme Court of India · Bench: J.C. SHAH · Disposal: Dismissed

Judgment (excerpt)

' 
COMMISSIONER OF INCOME TAX, MADRAS 
A 
v. 
S. CHENNIAPPA MUDALIAR, MADURAI 
February 24, 1969 
[J. C. SHAH, V. RAMASWAM! AND A. N. GROVER, JJ.] 
Income Tax Act 1922, section 33(4)-Appellate Tribunal Rules !946; 
Rule 24-lf Appellate Tribunal has powers to dismiss appeal for default 
in appearance-Whether Tribunal bound to pass orders on merits-If rule 
24 ultra vires section 33(4). 
B 
The respondent's appeal against an order of assessment was rejected 
by the Appellate Assistant Commissioner and he, the -.after appealed to 
C 
the Appellate Tribunal. The Tribunal, after having granted some adjourn-
ments, dismissed the appeal for default in appearance Qn a day fixed for 
the hearing, purporting to do so under rule 24 of the Appellate Tribunal 
Rules, 1946. The Hi~h Court directed the Tribunal to refer two questions 
to itself, one relating to the merits and the other to the effect whether rule 
24 of the Appellate Tribunal Rules, 1946, in so far as it enab·es the Tri-
bunal to dismiss an appeal in default in appearance, is 
ultra vlres. A 
D 
special bench of the High Court took the view that under section 3 3 ( 4) 
the Tribunal ·was bound to dispose of the. appeal on the merits, whether 
the appellant was present or not. 
On appeal to this Court, 
HELD : It follows from the language of s. 33 ( 4) and in particular 
the use of the word "thereon" that the Tribunal has to go into the cor-
E 
rectness or otherwise of the points decided by the departmental authorities 
in the light of the submissions made by the appellant. This can only be 
done by giving a decision on the merits on questions of fact and law and 
not by merely disposing of the appeal on the ground that the party con-
cerned bad failed to appear, [824 C-D] 
The provisions contained in s, 66 about making a reference on QUO$• 
lions of law to the High Court would be rendered nugatory if a power is 
F 
attributed to the Appellate Tribunal by which it can dismiss an appeal, 
which has otherwise been properly filed, for default, without making an 
order thereon in accordance with s. 33(4). So far as the questions of 
fact are concerned the deci:sion of the Tribunal is final and reference can 
be sought to the High Court only on questions of law. The High Court 
exercises purely advisory jurisdiction and has no appellate or revisional 
powers. The advisory jurisdiction can be exercised on a proper reference 
being made and that cannot be done unless the Tribunal itself bas passed 
G 
a proper order under s. 33(4). [824 E-H] 
Rule 24 clearly comes into conflict with section 33(4) and in the event 
of repugnancy between the substantive p'rovisions of the Act and, a rule, 
it is the rule which must give way to the provisions of the Act. [825 HJ 
Shri Bhtgwan Radha Kishen v. Commissioner of Income tax, U.P. 22 
l.T.R. 104; Ruvula Subba Rao & Ors. v. Commis.<ioner of Income tax 
H 
MttdMs, 27 l.T.R. 164; Mangat Ram Kurhiala & Ors. v. Commissioner of 
Income tax, Punjab, 38 I.T.R. 1; Hukumchand Mi/ls Lrd. v. Commissioner 
of Income tax, Central Bombay, 63 I.T.R. 232; Com'11issloner of lnco1118 
A 
B 
c 
D 
C.I.T. v. CHENNIAPPA (Grover, J.) 
S!9 
tax Madr/18 v. Mtt. Ar. S. Ar. Aru11JJcha/am Ch<ttiar, 23 I.T.R. 180 and 
Co1nmissioner of Income tax, Bombay v. Scirtdia Steam Navigation Co. 
Ltd. 42 J.T.R. 589, referred to. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1015 of 
1968. 
Appeal from. the judgment and order dated April 30, 1964 
of the Madras High Court in T.C. No. 194 of 1961 (Reference 
No. 74 of 1961). 
D. Narsaraju, R.H. Dhebar, R. N. Sachthey and B. D. Sharma, 
for the appellll\.'lt. 
R. Gopalkrishnan and R. Ba/asubramaniam, for the respon-
dent. 
The Judgment of the Court was delivered by 
Grover, J. 
This is an appeal by certificate from a judgment 
of the Special Bench of the Madras High Court in which the sole 
question that has to be determined is whether Rule 24 of the Ap-
pellate Tribunal Rules, 1946, insofar as it enables the Tribunal 
to dismiss an appeal for default of appearance was ultra vires the 
provisions of s. 33 of the Income tax Act, 1922, hereinafter called 
the "Act". 
The facts which gave rise to the reference which was made 
to the High Court by the Appellate Tribunal lie within a narrow 
E 
compass. The assessee owned 1674 shares in Asher Textiles Ltd. 
and 9 out of 20 shares in Textile Corporation (Private) Ltd. ~t 
Tiruppur. The latter company was the managing agents of the 
Asher Textiles Ltd. The assessee was a Joint Ma

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