Case: Commissioner Of Wealth Tax Bombayand Another Vs. Mrs. Kasturbai Walchand &amp; Others

Assistant Commissioner as no appeals had been filed by the respondent. Meanwhile, however, during the pendency of the appeals before the Appellate Tribunal, the respondent preferred revision applications on June 29, 1962, under subsection (1) of section 25 to the Commissioner of Wealth-tax in respect of the aforesaid assessment years and contended that the valuation of the shares adopted by the Appellate Assistant Commissioner was unreasonable and excessive and should be duly modified. The Commissioner made an order dated August 12, 1964, rejecting the revision applications on the ground that they were incompetent in view of clause (b) of the proviso to sub-section (1) of section 25 of the Act. Against that order, the respondent filed a writ petition in the High Court of Bombay and contended that the Commissioner had erred in dismissing the revision applications as incompetent. On October 10, 11, 1966, a learned single judge of the High Court allowed the writ petition holding the revision applications to be competent and, accordingly, directed the Commissioner to entertain and dispose of the revision applications in accordance with law. The Commissioner appealed to a Division Bench of the High Court and the appeal was dismissed on January 10, 1973The relevant provisions of section 25 of the Wealth-tax Act read as follows: "Powers of Commissioner to revise orders of subordinate authorities. - (1) The Commissioner may, either of his own motion or on application made by an assessee in this behalf, call for the record of any proceeding under this Act in which an order has been passed by any authority subordinate to him, and may make such inquiry, or cause such inquiry to be made, and, subject to the provisions of this Act, pass such order thereon, not being an order prejudicial to the assessee, as the Commissioner thinks fitProvided that the Commissioner shall not revise any order under this sub-section in any case (a) where an appeal against the order lies to the Appellate Assistant Commissioner or to the Appellate Tribunal, the time within which such appeal can be made has not expired or in the case of an appeal to the Appellate Tribunal, the assessee has not waived his right of appeal ;(b) where the order is the subject of an appeal before the Appellate Assistant Commissioner or the Appellate Tribunal." 4. The High Court has taken the view that clause (b) of the proviso to sub-section (1) of section 25 of the Act operates as a bar to a revision application by an assessee before the Commissioner only where the assessee has also filed an appeal before the Appellate Tribunal. According to the High Court, the bar does not come into operation against an assessee where the appeal before the Appellate Tribunal has been filed by the Revenue. It seems to us that the view taken by the High Court cannot be sustained. Where an appeal is filed before the Appellate Tribunal against an order of the Appellate Assistant Commissioner, the impugned order merges in the order of the Appellate Tribunal when the appeal is disposed of on merits. If, meanwhile, a revision application has been filed before the Commissioner against the same order of the Appellate Assistant Commissioner, it will not be open to the Commissioner to pass any order in revision against the order of the Appellate Assistant Commissioner as the latter would have merged with the order of the Appellate Tribunal. It is immaterial that the appeal and the revision application have not been filed by the same party. This would be plainly so as, in the present case, the subject-matter of the appeal before the Appellate Tribunal is the same as that of the revision application before the Commissioner. Here, the subject-matter of the appeal before the Appellate Tribunal was the valuation of the shares held by the respondent. So, it was also in the revision application before the CommissionerIn the circumstances, we are unable to agree with the reasoning adopted by the High Court. The High Court has proceeded on the view that it was open to the Commissioner to dispose of the revision applications filed by the respondents. The High Court, it seems to us, omitted to consider that the appeals filed before the Tribunal had been disposed of and the impugned order of the Appellate Assistant Commissioner must be taken to have merged in the order of the Appellate Tribunal. The revision applications, in short, had become infructuous. 5. What the respondent should have done, on coming to know of the filing of the appeal by the Revenue before the Appellate Tribunal, was to have withdrawn the revision petitions filed before the Commissioner and filed her own appeals before the Appellate Tribunal with an application for condonation of delay under sub-section (3) of section 24, in case the period of limitation had expired and, accordingly, both the sets of appeals would have been disposed of by the Appellate Tribunal. In case the respondent came to know of the filing of the appeals by the Revenue before the Appellate Tribunal and had not yet applied in revision to the Commissioner, she should not have filed the revision applications but should have preferred her own appeals before the Appellate Tribunal. It must be noted that the Appellate Tribunal is a body superior to the Commissioner, as will be clear from sub-section (1) of section 26 which provides that an appeal will lie to the Appellate Tribunal from an order under sub-section (2) of section 25 of the Commissioner. There would have been no difficulty in the Appellate Tribunal considering the appeals of both parties and passing suitable orders in regard to the valuation of the shares. There is no difficulty now in dealing with such a situation in view of sub-section (2A) of section 24In the case of the other respondents, there is a similar history of proceedings with similar orders passed therein, and this judgment will be considered as disposing of the appeals filed here in those cases also. 6.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]The High Court, it seems to us, omitted to consider that the appeals filed before the Tribunal had been disposed of and the impugned order of the Appellate Assistant Commissioner must be taken to have merged in the order of the Appellate Tribunal. The revision applications, in short, had becomethe respondent should have done, on coming to know of the filing of the appeal by the Revenue before the Appellate Tribunal, was to have withdrawn the revision petitions filed before the Commissioner and filed her own appeals before the Appellate Tribunal with an application for condonation of delay under sub-section (3) of section 24, in case the period of limitation had expired and, accordingly, both the sets of appeals would have been disposed of by the Appellate Tribunal. In case the respondent came to know of the filing of the appeals by the Revenue before the Appellate Tribunal and had not yet applied in revision to the Commissioner, she should not have filed the revision applications but should have preferred her own appeals before the Appellate Tribunal. It must be noted that the Appellate Tribunal is a body superior to the Commissioner, as will be clear from sub-section (1) of section 26 which provides that an appeal will lie to the Appellate Tribunal from an order under sub-section (2) of section 25 of the Commissioner. There would have been no difficulty in the Appellate Tribunal considering the appeals of both parties and passing suitable orders in regard to the valuation of the shares. There is no difficulty now in dealing with such a situation in view of sub-section (2A) of section 24In the case of the other respondents, there is a similar history of proceedings with similar orders passed therein, and this judgment will be considered as disposing of the appeals filed here in those cases also