IMPORTANT POINT
Section 260A of Income Tax Act, 1961 is akin to section 100 CPC, hence the appellate court has to follow the same principles.

JUDGMENT

Abhay Manohar Sapre, J.

1. Leave granted.

2. This appeal is filed against the final judgment and order dated 25.10.2016 passed by the High Court of Judicature for Rajasthan, Bench at Jaipur in D.B. Income Tax Appeal No. 43 of 2002 whereby the Division Bench of the High Court dismissed the appeal filed by the appellant herein and affirmed the order dated 24.05.2001 passed by the Income Tax Appellate Tribunal (ITAT), Jaipur Bench, Jaipur in I.T.S.S.A. No.29/JP/2000.

3. A few facts need mention infra for the disposal of the appeal.

4. This appeal filed by the Revenue arises out of the income tax proceedings initiated against the respondent(assessee) on the basis of a search operation which was carried out by the Income Tax Department in assessee’s premises on 04.09.1997. This gave rise to initiation of assessment proceedings for the block period from 01.04.1987 to 04.09.1997 (Assessment Years 1987-88 to 1996-97 and 1997-98 up to 04.09.1997) against the assessee to determine their tax liability as a result of search operations carried in their premises. The matter, out of the block assessment proceedings, reached to the Income Tax Appellate Tribunal at the instance of the respondent against the order of the assessing authorities.

5. The Tribunal (ITAT), however, decided the various issues arising in the case in favour of the respondent(assessee) by allowing the respondent's appeal, which gave rise to filing of the appeal by the Revenue before the High Court under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).

6. The High Court by impugned judgment dismissed the Revenue's appeal, which gave rise to filing of this appeal by way of special leave by the Revenue in this Court.

7. Having heard the learned counsel for the parties and on perusal of the record of the case, we are constrained to allow the appeal and remand the case to the High Court for deciding the appeal afresh on merits in accordance with law.

8. The need to remand the case to the High Court has arisen for the reason that on perusal of the impugned order, we find that the High Court has set out the facts in paragraph 2 and the submissions of the counsel for the parties in paragraphs 3 to 9. In paragraph 10, the High Court mentioned the names of the counsel who argued the case and then in paragraphs 12 and 13, the High Court states as under :

“12. The Tribunal while considering the judgment on 24.05.2001 did not consider the amendments envisaged by the legislature, therefore, under Section 260-A when we are considering substantial law, we have to consider whether the Tribunal has committed an error.

13. In view of the above, the issue is answered in favour of the assessee and against the department. The view taken by this Court in a case of Relaxo Foorwear (supra) will apply in the present case and the view taken by the Tribunal is liable to be confirmed and the same is confirmed.”

9. A perusal of the aforementioned two concluding paragraphs would go to show that the High Court has neither discussed and nor assigned any reason in support of its conclusion for the dismissal of the appeal.

10. Indeed, the observation made in paragraph 13 that "In view of the above" does not lead us anywhere because, as mentioned above, in the paragraphs 1 to 12 no reasons are mentioned except the facts and the submissions.

11. That apart, we find that the High Court committed another error. The High Court while deciding the appeal heard the learned counsel for the parties, yet did not frame any substantial question of law arising in the case.

12. Section 260A of the Act is akin to Section 100 of the Code of Civil Procedure, 1908 (hereinafter referred to as “the Code”) with addition of sub-sections (6)(a),6(b) and (7) of Section 260A of the Act.

13. The High Court has jurisdiction to dismiss the appeal filed under Section 260A of the Act on the ground that it does not involve any substantial question of law. Such dismissal is considered as a dismissal