JODHPUR BENCH (THIRD MEMBER) KOTHARI DEPARTMENTAL v. ASSESSING OFFICER STORES (P) LTD. April 20, 2005 JUDGMENT Order s.R. chauhan, j.m.: December, 2002 By this order we are deciding issue of fee payable by appellant- assessee for filing this appeal in Tribunal. point that has cropped up for our consideration is as to what is meant by expression "total income of assessee as computed by AO, in case to which appeal relates" used in cls. (a) to (d) of s. 253(6) of IT Act, 1961. learned Authorised Representative of assessee-appellant has contended that r. 4A(1)(iv) of Appellate Tribunal Rules, 1963, deals with defect of appeal-fee. He has contended that it is income, which comes after giving appeal effect by AO and not income as determined by AO in original assessment order on which appeal fee is payable. He has contended that in this case final valuation has to be made at Rs. 1,70,700, which is after appeal effect whereas registry is seeking appellant to pay fee on valuation at Rs. 4,04,170, which is as per original assessment order of AO under s. 143(3). He has contended that fee is to be computed as per s. 253(6). In written statement of assessee it has also been contended that expression "total income as computed by AO" also includes effect of learned CIT(A) s appellate order as after first appeal original assessment order merges with appellate order of learned CIT(A) and again it is AO who has finally to make computation under s. 143(3)/250 of Act. It has also been contended that it is AO who serves demand notice under s. 156 pursuant to total income computed by him or as per order of CIT(A). It has also been contended that logically also it does not stand to reason as to why appellant should be asked to pay fee for that part of order against which appellant is not in appeal before Tribunal. As against this learned Departmental Representative of Revenue has contended that fee is to be charged as per computation of total income made by AO in original assessment order without considering appeal effect. We have considered rival contentions as also relevant provision of law. In our considered opinion contentions raised by learned Authorised Representative of appellant-assessee have substance. It is understandable that appellant should be required to pay appeal fee only for that impugned order, or for that matter, on basis of total income computed after giving effect to that impugned order, which he seeks Tribunal to adjudicate upon, and consider appellant s claim for redressal for purpose of providing, to appellant, appropriate relief, if any, and not for any other order of assessment, be it first/original assessment or otherwise, nor for income computed by AO under such latter mentioned order, against which neither appellant is presently in appeal, nor does appellant seek Tribunal to adjudicate thereupon for any relief thereagainst whether substantive or academic, and rather that other order (first/original assessment) may, sometimes, be favourable to appellant on particular count being agitated presently in appeal. We may observe here, with all clarity, that we are of view that appeal-fee is leviable on total income computed as result of order being impugned/challenged in appeal, and not on part of total income despite fact that appellant may not be challenging impugned order on all counts decided thereby and may be challenging only on some of those counts. We may cite illustration for convenience. Say for example, assessee has declared income of Rs. 1 lakh in return. AO assesses income at Rs. 10 lakhs and thereby makes addition of Rs. 9 lakhs. In first appeal first appellate authority allows relief of Rs. 4 lakhs; and out of balance addition assessee agreed on addition of Rs. 2 lakhs, but contested addition of Rs. 3 lakhs but first appellate authority rejected assessee s contentions regarding addition of Rs. 3 lakhs and sustained same as well. Now for filing second appeal before Tribunal, though assessee wants to agitate addition of Rs. 3 lakhs alone, but still assessee will have to pay appeal-fee not on income of Rs. 3 lakhs but on income of Rs. 5 lakhs, for reason of that being total income computed by AO after giving appeal effect. In this context, it may be of some benefit to recall that what is required to be paid by appellant under s. 253(6) is "fee" and not tax; and fee, by its very nature, is relatable to benefit/facility/relief being claimed by payer. If assessee had grievance against assessment order on ten counts but he has been allowed relief on nine out of those ten counts by first appellate authority and assessee intends to prefer second appeal before Tribunal, then it makes out no sense to compel him to pay fee in respect of all ten counts (involved in first/original order of AO), despite fact that he is neither agitating those nine counts in second appeal, nor is Tribunal going to consider/decide them. otherwise interpretation may, in our humble opinion, seem to be violating very principles of natural justice. We may, for our benefit sake, in this regard, also analyze with careful consciousness language of statutory provision in context of levy of appeal-fee. Sec. 253(6) uses phraseology "total income of assessee as computed by AO in case to which appeal relates". It nowhere mentions that basis for calculation of appeal fee shall be total income as computed by AO in "first assessment" or "original assessment". On contrary it uses expression total income of assessee as computed by AO "in case to which appeal relates". We find no reason to hold that above expression excludes interpretation that it is that total income which stands computed by AO after giving effect to appellate order whereagainst assessee seeks to prefer second appeal before Tribunal. Besides, we may note that words "first assessment" or "original assessment" do not appear in abovementioned statutory provision, and it is so not without purpose. Here we need be aware that wherever legislature intended regular (first) assessment, very term has been used specifically so as to express legislative intent as for example in s. 158BA(2), Expln. (a), (b), (c), 214, Expln. 2, 215(1), (2), (5), (6) and 217(1)/(1A). It is settled position of law that in interpreting fiscal statute, Court/Tribunal cannot supply deficiency, if there by any, and in this regard, we may refer to CIT vs. Shaan Finance (P) Ltd. (1998) 146 CTR (SC) 110: (1998) 231 ITR 308 (SC), with advantage. beneficial and justice-oriented interpretation, which we are going to take, as spoken above, in no way, offends against language of statutory provision nor against legislative intent of providing redressal avenues of appeal. If we look into matter with comparing eye, we may note that in case of civil litigation as well as Court fee chargeable for filing second appeal is based on valuation of challenged appellate order and not on that of judgment and decree passed in original suit. position of second appeal before Tribunal is on same parity as second appeal in civil litigation, and so also in matter of justice rendering framework, we need hardly prefer to deviate from analogical rationale of redressal aspect in civil litigation. However, one may grumble about some difficulty that whenever appeal is to be preferred each time effect (or appeal effect) of respective impugned order will have to be worked out and computation of total income to be modified in accordance therewith, but such grievance, in our view, is too feeble to be sustained. It may hardly be deniable that normally each and every appellate order/revisional order has to be given effect to, and this process of giving appeal effect does, in no abnormal way, result in working out of modified total income. process of rendering justice, by allowing preferment of appeal on payment of fee on basis of total income as it stands computed by AO after giving appeal effect, need not be obstacled by otherwise interpretation which tends to stifling rather than redressing, also for reason that interpretation favourable to assessee may be preferred when there are two reasonably conceivable interpretations. In that view of matter, considering all facts and circumstances of case, as also redressal aspect of justice involved, we agree with contentions of learned Authorised Representative of assessee that fee for filing appeal before Tribunal should be chargeable on total income computed by AO after giving effect to impugned appellate order of first appellate authority; and this will relieve assessee-appellant of burden of fee with respect to that part of AO s original assessment order which assessee is not agitating before Tribunal, whether for reason that in respect of same assessee has got relief from first appellate authority vide impugned appellate order, or for some other reason. Be that as it may, considering all facts and related aspects, we direct that for filing appeal before Tribunal, assessee-appellant shall pay fee on total income computed by AO after giving effect to appellate order of first appellate authority, being challenged in appeal before Tribunal. We order accordingly. b.l. khatri, a.m.: th Jan., 2003 I have carefully perused order of learned JM, but I have not been able to persuade myself to agree with conclusion contained in proposed order. By this order, we are required to decide issue of fees payable for filing of appeal in Tribunal. Question involved is whether fee is payable on income computed/assessed by AO or on income computed by AO on direction of first appellate authority i.e., CIT(A). Appealable orders passed by AO are mentioned in s. 246 of IT Act. Procedure for filing of appeal before first appellate authority is laid down in s. 250 of Act. appellate order is passed by CIT(A) or first appellate authority under s. 251 of Act. AO determines/computes/assesses income of particular assessee under s. 143(3), etc. of Act. After determination of income by AO, appellant, if aggrieved, has right to appeal before first appellate authority. It is relevant to reproduce sub-s. (6) of s. 253 of Act which reads as under: "(6) appeal to Appellate Tribunal shall be in prescribed form and shall be verified in prescribed manner and shall, in case of appeal made, on or after 1st day of October, 1998, irrespective of date of initiation of assessment proceedings relating thereto, be accompanied by fee of (a) where total income of assessee in case to which appeal relates, is one hundred thousand rupees or less, five hundred rupees, (b) where total income of assessee, computed as aforesaid, in case to which appeal relates is more than one hundred thousand rupees but not more than two hundred thousand rupees, one thousand five hundred rupees (c) where total income of assessee, computed as aforesaid, in case to which appeal relates is more than two hundred thousand rupees, one per cent of assessed income, subject to maximum of ten thousand rupees, (d) where subject-matter of appeal relates to any matter, other than those specified in cls. (a), (b) and (c), five hundred rupees: Provided that no such fee shall be payable in case of appeal referred to in sub-s. (2) or memorandum of cross-objections referred to in sub-s. (4)." Clause (a) of sub-s. (6) of s. 253 clearly states that total income of assessee in case to which appeal relates is to be taken as basis for determination of income on which fee is payable for filing appeal before Tribunal. This view is further strengthened from perusal of Form No. 36 prescribed under r. 47(1) of IT Rules, 1962, for filing appeal before Tribunal. relevant columns 2 to 5 of Form No. 36 are reproduced below: "2. Section under which order appealed against was passed. Assessment year in connection with which appeal is preferred. A. Total income declared by assessee for assessment year referred to in item 3 B. Total income as computed by AO for assessment year referred to in item 3. ITO passing original order. Section of IT Act, 1961, under which AO passed order." From perusal of above columns prescribed in Form No. 36, it is evident that total income is to be taken as computed by AO without giving effect to appellate order of first appellate authority. I am of opinion that income computed by AO under direction of first appellate authority cannot be said to be income computed by him. income as computed by AO in order passed by him under s. 143(3), etc. is to be taken as basis for payment of fees for filing appeal to Tribunal. This view is further strengthened by Circular vide U.O. No. F. 71-Ad (AT)/1998 p. II, dt. 23rd Sept., 1998, and 10th July, 2000 issued by registrar on behalf of President of Tribunal. In these circulars, I find reference to income computed by AO and even loss computed by AO is to be treated at positive income and fee chargeable has to be determined on that basis, as held in case Resource Technology (P) Ltd. vs. Dy. CIT in Nos. 1022 & 1023/Hyd/1993 decided along with case of Andhra Pradesh State Electricity Board vs. ITO (1994) 49 TTJ (Hyd) 315: (1994) 49 ITD 552 (Hyd). I also rely on case of AP Elec. Board wherein it was held as under: "On plain reading of s. 253(6), it is clear that it is total income as computed by AO in case to which appeal relates. Therefore, total income which is computed by AO must be in case which is in appeal. assessment order gives birth to appeal before first appellate authority and appeal then comes to Tribunal against that order in first appeal. It is, therefore, imperative that total income computed in that order of assessment which gives rise to appeal to Tribunal is relevant. Any modification or alteration in income consequent to appellate order would not be relevant. contention of assessee is that order giving effect to appellate order is also order of assessment. It is true that order giving effect to order of first appellate authority is also order of assessment, but income determined in that order might not be income computed by AO as AO might just be giving effect to appellate order and there might not be application of his mind; he would be doing ministerial work. Again, computation of total income by AO must be in case which is in appeal before Tribunal. When original assessment is made subject-matter of appeal before Tribunal, it is income that is computed in that order which is relevant and not income as modified, revised or computed in subsequent proceedings. Furthermore, if assessee s contention is accepted then why stop at that order giving effect to appellate order. It should be every subsequent order including order giving effect to order of Tribunal, CIT under s. 263 or s. 264, reassessment order under s. 147, rectification order under s. 154/155 and so on. It would then be very difficult rather impossible and impracticable to give effect to provision. Such interpretation, with absurd results, has to be avoided. It is, therefore, held that total income which was computed in orders of AO which is subject- matter of appeal before Tribunal is relevant and if in those orders assessed income is more than Rs. 1 lakh, fee of Rs. 1,500 has to be paid for filing appeal before Tribunal." Having regard to legal provisions as explained above, I am of opinion that total income assessed by AO which is relevant for purpose of payment of fee for filing appeal to Tribunal and not income as computed in subsequent proceedings under directions of superior authorities. REFERENCE UNDER S. 255(4) OF IT ACT, 1961 th Jan., 2003 Since there is difference of opinion between two members, being JM and AM, constituting this Bench of Tribunal (Jodhpur) on point of interpretation of expression "total income of assessee as computed by AO" contained in s. 253(6), being basis for calculating prescribed fee payable on filing of appeal before Tribunal, following point is stated with request that Hon ble President Tribunal, may kindly nominate Third Member for deciding point/question stated below as required under s. 255(4) of IT Act, 1961: "Whether, on facts and in circumstances of case, fee payable for filing of appeal before Tribunal as per s. 253(6) of IT Act, 1961, should be calculated on basis of amount of total income as computed by AO after giving effect to order of first appellate authority or on basis of amount of total income as computed by AO in first/regular assessment?" m.a. bakshi, vice president (as third member): th April, 2005 appeal of assessee for asst. yr. 1998-99 came up for consideration of Division Bench of Tribunal. Division Bench did not go into merits of grounds of appeal raised by assessee in so far as it was found that assessee had not paid in full fee payable under s. 253(6) of IT Act, 1961 (hereinafter referred to as Act ). On hearing both parties, Members of Division Bench differed on interpretation of s. 253(6). Whereas learned JM has expressed view that fee payable under s. 253(6) is to be calculated with reference to assessed income as modified by CIT(A), on other hand, learned AM has expressed view that appeal fee payable under s. 253(6) is relatable to income as assessed by AO and modification as result of appellate order is not to be taken into consideration. learned AM has relied upon decision of Hyderabad Bench of Tribunal in case of Andhra Pradesh State Electricity Board vs. ITO (1994) 49 TTJ (Hyd) 315: (1994) 49 ITD 552 (Hyd) to support his view. As result of difference of opinion amongst Members of Division Bench, Hon ble President has nominated me as Third Member for decision on following point of difference: "Whether, on facts and in circumstances of case, fee payable for filing of appeal before Tribunal as per s. 253(6) of IT Act, 1961, should be calculated on basis of amount of total income as computed by AO after giving effect to order of first appellate authority or on basis of amount of total income as computed by AO in first/regular assessment?" I have heard both parties and also gone through orders of my learned Brothers. issue revolves upon interpretation of provisions of s. 253(6). It will be useful to refer to s. 253, which reads as under: "253. Appeals to Appellate Tribunal. (1) Any assessee aggrieved by any of following orders may appeal to Appellate Tribunal against such order (a) order passed by Dy. CIT(A) before 1st day of October, 1998, or as case may be, by CIT(A) under s. 154, s. 250, s. 271, s. 271A or s. 272A; or (b) order passed by AO under cl. (c) of s. 158BC in respect of search initiated under s. 132 or books of account, other documents or any assets, requisitioned under s. 132A, after 30th day of June, 1995, but before 1st day of January, 1997; or (c) order passed by CIT under s. 12AA or under s. 263 or under s. 271 or under s. 272A or order passed by him under s. 154 amending his order under s. 263 or order passed by Chief CIT or Director General or Director under s. 272A. (2) CIT may, if he objects to any order passed by Dy. CIT(A) before 1st day of October, 1998 or, as case may be, CIT(A) under s. 154 or s. 250, direct AO to appeal to Tribunal against order. (3) Every appeal under sub-s. (1) or sub-s. (2) shall be filed within sixty days of date on which order sought to be appealed against is communicated to assessee or to CIT, as case may be: Provided that in respect of any appeal under cl. (b) of sub-s. (1), this sub- section shall have effect as if for words "sixty days", words "thirty days" had been substituted. (4) AO or assessee, as case may be, on receipt of notice that appeal against order of Dy. CIT(A) or, as case may be, CIT(A) has been preferred under sub-s. (1) or sub-s. (2) by other party, may, notwithstanding that he may not have appealed against such order or any part thereof, within thirty days of receipt of notice, file memorandum of cross-objections, verified in prescribed manner, against any part of order of Dy. CIT(A) or, as case may be, CIT(A), and such memorandum shall be disposed of by Tribunal as if it were appeal presented within time specified in sub-s. (3). (5) Tribunal may admit appeal or permit filing of memorandum of cross-objections after expiry of relevant period referred to in sub-s. (3) or sub-s. (4), if it is satisfied that there was sufficient cause for not presenting it within that period. (6) appeal to Appellate Tribunal shall be in prescribed form and shall be verified in prescribed manner and shall, in case of appeal made, on or after 1st day of October, 1998, irrespective of date of initiation of assessment proceedings relating thereto, be accompanied by fee of, (a) where total income of assessee as computed by AO, in case to which appeal relates, is one hundred thousand rupees or less, five hundred rupees, (b) where total income of assessee, computed as aforesaid, in case to which appeal relates is more than one hundred thousand rupees but not more than two hundred thousand rupees, one thousand five hundred rupees, (c) where total income of assessee, computed as aforesaid, in case to which appeal relates is more than two hundred thousand rupees, one per cent of assessed income, subject to maximum of ten thousand rupees; (d) where subject-matter of appeal relates to any matter, other than those specified in cls. (a), (b) and (c), five hundred rupees: Provided that no such fee shall be payable in case of appeal referred to in sub-s. (2) or memorandum of cross-objections referred to in sub-s. (4). (7) application for stay of demand shall be accompanied by fee of five hundred rupees." Since s. 253 refers to total income, it would be useful to refer to s. 2(45) of Act, which defines total income. said section reads as under: "2(45) "total income" means total amount of income referred to in s. 5, computed in manner laid down in this Act;" In order to appreciate controversy, it will also be useful to refer to s. 251 of Act which gives powers to CIT(A). section reads as under: "251. Powers of CIT(A). (1) In disposing of appeal, CIT(A) shall have following powers (a) in appeal against order of assessment, he may confirm, reduce, enhance or annual assessment; (b) in appeal against order imposing penalty, he may confirm or cancel such order or vary it so as either to enhance or to reduce penalty; (c) in any other case, he may pass such orders in appeal as he thinks fit. (2) CIT(A) shall not enhance assessment or penalty or reduce amount of refund unless appellant has had reasonable opportunity of showing cause against such enhancement or reduction. Explanation: In disposing of appeal, CIT(A) may consider and decide any matter arising out of proceedings in which order appealed against was passed, notwithstanding that such matter was not raised before CIT(A) by appellant." Reference may also be made to s. 156 of Act, which requires AO to issue notice of demand to recover any sum due under Act. Hon ble Supreme Court in case of Dwarka Nath vs. ITO & Anr. (1965) 57 ITR 349 (SC), has laid down that AO is required to serve on assessee notice of demand in prescribed form if any amount is due from assessee in consequence of any order passed under IT Act. In order to complete relevant provisions of Act, I consider it appropriate to refer to some other provisions of Act. "254. Orders of Appellate Tribunal. (1) Appellate Tribunal may, after giving both parties to appeal opportunity of being heard, pass such orders thereon as it thinks fit. (2) Appellate Tribunal may, at any time within four years from date of order, with view to rectifying any mistake apparent from record, amend any order passed by it under sub-s. (1), and shall make such amendment if mistake is brought to its notice by assessee or AO: Provided that amendment which has effect of enhancing assessment or reducing refund or otherwise increasing liability of assessee, shall not be made under this sub-section unless Tribunal has given notice to assessee of its intention to do so and has allowed assessee reasonable opportunity of being heard: Provided further that any application filed by assessee in this sub- section on or after 1st day of October, 1998, shall be accompanied by fee of fifty rupees. (2A) In every appeal, Appellate Tribunal, where it is possible, may hear and decide such appeal within period of four years from end of financial year in which such appeal is filed under sub-s. (1) or sub-s. (2) of s. 253: Provided that where order of stay is made in any proceedings relating to appeal filed under sub-s. (1) of s. 253, Appellate Tribunal shall dispose of appeal within period of one hundred and eighty days from date of such order: Provided further that if such appeal is not so disposed of within period specified in first proviso, stay order shall stand vacated after expiry of said period. (2B) cost of appeal to Tribunal shall be at discretion of that Tribunal. (3) Appellate Tribunal shall send copy of any orders passed under this section to assessee and to CIT. (4) Save as provided in s. 256 or s. 260A orders passed by Appellate Tribunal on appeal shall be final." Sec. 260(1A) is also relevant. It reads as under: "(1A) Where High Court delivers judgment in appeal filed before it under s. 260A, effect shall be given to order passed on appeal by AO on basis of certified copy of judgment." I also consider it necessary to refer to s. 139(1) under which assessee files return and to s. 143(3) under which AO is empowered to make assessment of income of assessee and tax payable thereon, which are reproduced as under: Sec. 139(1) reads as under: "(1) Every person, (a) being company; or (b) being person other than company, if his total income or total income of any other person in respect of which he is assessable under this Act during previous year exceeded maximum amount which is not chargeable to income-tax, shall, on or before due date, furnish return of his income or income of such other person during previous year, in prescribed form and verified in prescribed manner and setting forth such other particulars as may be prescribed: Provided that person referred to in cl. (b), who is not required to furnish return under this sub-section and residing in such area as may be specified by Board in this behalf by notification in Official Gazette, and who at any time during previous year fulfils any one of following conditions, namely: (i) is in occupation of immovable property exceeding specified floor area, whether by way of ownership, tenancy or otherwise, as may be specified by Board in this behalf; or (ii) is owner or lessee of motor vehicle other than two-wheeled motor vehicle, whether having any detachable side car having extra wheel attached to such two-wheeled motor vehicle or not; or (iii) is subscriber to cellular telephone not being wireless in local loop telephone; or (iv) has incurred expenditure for himself or any other person on travel to any foreign country; or (v) is holder of credit card, not being "add on" card, issued by any bank or institution; or (vi) is member of club where entrance fee charged is twenty-five thousand rupees or more, shall furnish return, of his income during previous year, on or before due date in prescribed form and verified in prescribed manner and setting forth such other particulars as may be prescribed: Provided further that Central Government may, by notification in Official Gazette, specify class or classes of persons to whom provisions of first proviso shall not apply: Provided also that every company shall furnish on or before due date return in respect of its income or loss in every previous year. Explanation 1: For purposes of this sub-section, expression "motor vehicle" shall have meaning assigned to it in cl. (28) of s. 2 of Motor Vehicles Act, 1988 (59 of 1988). Explanation 2: In this sub-section, "due date" means, (a) where assessee is (i) company, or (ii) person (other than company) whose accounts are required to be audited under this Act or under any other law for time being in force; or (iii) working partner of firm whose accounts are required to be audited under this Act or under any other law for time being in force, 31st day of October of assessment year; (b) in case of person other than company, referred to in first proviso to this sub-section, 31st day of October of assessment year; (c) in case of any other assessee, 31st day of July of assessment year. Explanation 3: For purposes of this sub-section, expression "travel to any foreign country" does not include travel to neighbouring countries or to such places of pilgrimage as Board may specify in this behalf by notification in Official Gazette. (1A) Without prejudice to provisions of sub-s. (1), any person, being individual who is in receipt of income chargeable under head "salaries" may, at his option, furnish return of his income for any previous year to his employer, in accordance with such scheme as may be specified by Board in this behalf, by notification in Official Gazette, and subject to such conditions as may be specified therein, and such employer shall furnish all returns of income received by him on or before due date, in such form (including on floppy, diskette, magnetic cartridge tape, CD-ROM or any other computer readable media) and manner as may be specified in that scheme, and in such case, any employee who has filed return of his income to his employer shall be deemed to have furnished return of income under sub-s. (1), and provisions of this Act shall apply accordingly. (1B) Without prejudice to provisions of sub-s. (1), any person, being company or being person other than company, required to furnish return of income under sub-s. (1), may, at his option, on or before due date, furnish return of his income for any previous year in accordance with such scheme as may be specified by Board in this behalf by notification in Official Gazette and subject to such conditions as may be specified therein, in such form (including on floppy, diskette, magnetic cartridge tape, CD-ROM or any other computer readable media) and in manner as may be specified in that scheme, and in such case, return of income furnished under such scheme shall be deemed to be return furnished under sub-s. (1), and provisions of this Act shall apply accordingly." Sec. 143(3) reads as under: "143(3) On day specified in notice, (i) issued under cl. (i) of sub-s. (2), or as soon afterwards as may be, after hearing such evidence and after taking into account such particulars as assessee may produce, AO shall, by order in writing, allow or reject claim or claims specified in such notice and make assessment determining total income or loss accordingly, and determine sum payable by assessee on basis of such assessment; (ii) issued under cl. (ii) of sub-s. (2), or as soon afterwards as may be, after hearing such evidence as assessee may produce and such other evidence as AO may require on specified points, and after taking into account all relevant material which he has gathered, AO shall, by order in writing, make assessment of total income or loss of assessee, and determine sum payable by him or refund of any amount due to him on basis of such assessment: Provided that in case of (a) scientific research association referred to in cl. (21) of s. 10; (b) news agency referred to in cl. (22B) of s. 10; (c) association or institution referred to in cl. (23A) of s. 10; (d) institution referred to in cl. (23B) of s. 10; (e) fund or institution referred to in sub-cl. (iv) or trust or institution referred to in sub-cl. (v) or any university or other educational institution referred to in sub-cl. (vi) or any hospital or other medical institution referred to in sub-cl. (via) of cl. (23C) of s. 10, which is required to furnish return of income under sub-s. (4C) of s. 139, no order making assessment of total income or loss of such scientific research association, news agency, association or institution or fund or trust or university or other educational institution or any hospital or other medical institution, shall be made by AO, without giving effect to provisions of s. 10, unless (i) AO has intimated Central Government or prescribed authority contravention of provisions of cl. (21) or cl. (22B) or cl. (23A) or cl. (23B) or sub-cl. (iv) or sub-cl. (v) or sub-cl. (vi) or sub-cl. (via) of cl. (23C) of s. 10, as case may be, by such scientific research association, news agency, association or institution or fund or trust or university or other educational institution or any hospital or other medical institution, where in his view such contravention has taken place; and (ii) approval granted to such scientific research association or other association or institution or university or other educational institution or hospital or other medical institution has been withdrawn or notification issued in respect of such news agency or fund or trust or institution has been rescinded." contentions advanced on behalf of parties are to be considered in light of aforementioned provisions of Act. As is evident from s. 143(3) AO is empowered to make assessment and assess income of assessee. If assessee accepts assessment, order of AO becomes final subject to any interference from CIT under s. 263. However, if assessment made by AO is not accepted by assessee, statute provides appeal to first appellate authority, in this case being CIT(A). As is evident from provisions of s. 251, CIT(A) has power to confirm, reduce, enhance or annul assessment. CIT(A) is also empowered to enhance assessment or penalty or reduce amount or refund provided opportunity of showing cause against such enhancement or reduction is given to assessee. appeal is also provided against order of CIT(A) to assessee as well as to Revenue to Tribunal. If CIT(A) reduces quantum of income/penalty, Revenue is entitled to file and appeal to Tribunal. No fee is required to be paid by Department of Revenue for filing such appeals. However, in case assessee is aggrieved by order of CIT(A) in respect of any addition made by AO and confirmed by CIT(A) to file appeal to Tribunal. appeal to be filed by assessee is required to be in prescribed form and verified in prescribed manner. Sec. 253(6) also makes it obligatory upon assessee to pay requisite fee along with memo of appeal. said section has been reproduced above. perusal of said section reveals that legislature has classified fee structure into seven categories. These categories along with fee payable are mentioned hereunder: Fee payable (Rs.) (a) Where total income of assessee as computed by AO is Rs. 1,00,000 or less (b) Where total income of assessee as computed as aforesaid in case to which appeal relates is more than Rs. 1,00,000 but not more than Rs. 2,00,000 ,500 (c) Where total income of assessee computed as aforesaid in case to which appeal relates to is more than Rs. 2,00,000 % of assessed income subject to maximum of Rs. 10,000 (d) Where subject-matter of appeal relates to any other matter (e) Stay application under r. 35A (f) Rectification application under s. 254(2) (g) On appeal by Revenue and cross-objection by assessee Nil In this case, income of assessee as assessed by AO is Rs. 4,04,120. On appeal, CIT(A) allowed relief of Rs. 1,70,700. Revenue s case is that required fee to be paid by assessee is 1 per cent of income assessed by AO i.e., 1 per cent of Rs. 4,04,120. However, assessee s case is that he is required to pay fee @ 1 per cent of income as assessed after giving effect to order of CIT(A). As mentioned earlier, claim made by assessee has been accepted by Hon ble JM. However, Hon ble AM has taken contrary view. Hon ble AM has referred to decision of Hyderabad Bench of Tribunal in case of Andhra Pradesh State Electricity Board (supra). learned AM has quoted following para from order of Tribunal: "On plain reading of s. 253(6), it is clear that it is total income as computed by AO in case to which appeal relates. Therefore, total income which is computed by AO must be in case which is in appeal. assessment order gives birth to appeal before first appellate authority and appeal then comes to Tribunal against that order in first appeal. It is, therefore, imperative that total income computed in that order of assessment which gives rise to appeal to Tribunal is relevant. Any modification or alteration in income consequent to appellate order would not be relevant. contention of assessee is that order giving effect to appellate order is also order of assessment. It is true that order giving effect to order of first appellate authority is also order of assessment, but income determined in that order might not be income computed by AO as AO might just be giving effect to appellate order and there might not be application of his mind, he would be doing ministerial work. Again, computation of total income by AO must be in case, which is in appeal before Tribunal. When original assessment is made subject-matter of appeal before Tribunal, it is income that is computed in that order which is relevant and not income as modified, revised or computed in subsequent proceedings. Furthermore, if assessee s contention is accepted, then why stop at that order giving effect to appellate order. It should be every subsequent order including order giving effect to order of Tribunal, CIT under s. 263 or s. 264, reassessment order under s. 147, rectification order under s. 154/155 and so on. It would then be very difficult rather impossible and impracticable to give effect to provision. Such interpretation with absurd results has to be avoided. It is, therefore, held that total income which was computed in orders of AO which is subject- matter of appeal before Tribunal is relevant and if in those orders assessed income is more than Rs. 1 lakh, fee of Rs. 1,500 has to be paid for filing appeal before Tribunal." Whereas it may be fairly stated that view expressed by learned JM is possible view, if one were to go behind plain language of section, yet, in this case, it is observed that there is decision of Hyderabad Bench of Tribunal to support view expressed by learned AM. In such eventuality, it is not open to other Bench of Tribunal to take different view. This view is supported by decision of Madras High Court in case of CIT vs. L.G. Ramamurthi & Ors. 1977 CTR (Mad) 416: (1977) 110 ITR 453 (Mad). In this case, it has been held as under: "No Tribunal of fact has any right or jurisdiction to come to conclusion entirely contrary to one reached by another Bench of same Tribunal on identical facts. It may be that members who constituted Tribunal and decided on earlier occasion are different from members who decided case on present occasion. But what is relevant is not personality of officers presiding over Tribunal or participating in hearing, but Tribunal as institution. If it is to be conceded that simply because of change in personnel of officers who manned Tribunal, it is open to new officers to come to conclusion totally contradictory to conclusion which had been reached by earlier officers manning same Tribunal on same set of facts, it will not only shake confidence of public in judicial procedure as such, but it will also totally destroy such confidence. result of this will be conclusions based on arbitrariness and whims and fancies of individuals presiding over Courts or Tribunals and not reached objectively on basis of facts placed before authorities." This view has been reiterated in case of CIT vs. S. Devraj (1969) 73 ITR 1 (Mad), and of Bombay High Court in case of CIT vs. Modu Timblo (Ind.) vs. CIT (1994) 116 CTR (Bom) 442: (1994) 206 ITR 647 (Bom). Thus, keeping in mind above provisions of law and in light of decision of Hyderabad Bench of Tribunal in case of Andhra Pradesh State Electricity Board (supra), it is not open to other Bench of Tribunal to express contrary view unless earlier view of Bench is per incuriam. In case of CIT vs. Goodlas Nerolac Paints (1990) 90 CTR (Bom) 184: (1991) 188 ITR 1 (Bom) and in case of Sayaji Iron & Engg. Co. vs. CIT (2002) 172 CTR (Guj) 339: (2002) 253 ITR 749 (Guj), it has been held that when Bench wants to differ from earlier Bench decision, matter should be referred to President of Tribunal so that he could refer case to Full Bench. Hon ble Supreme Court in case of Union of India & Anr. vs. Paras Laminates (P) Ltd. (1990) 87 CTR (SC) 180: (1990) 186 ITR 722 (SC) have also expressed same view. In case of Pradip Chandra Parija & Ors. vs. Pramod Chandra Patnaik & Ors. (2002) 174 CTR (SC) 580: (2002) 254 ITR 99 (SC), their Lordships held as under: "Judicial discipline and propriety demands that Bench of two judges should follow decision of Bench of three judges. But if Bench of two judges concluded that earlier judgment of three judges is so very incorrect that in no circumstances can it be followed, proper course for it to adopt is to refer matter before it to Bench of three judges setting out, as has been done here, reasons why it could not agree with earlier judgment. If, then, Bench of three judges also comes to conclusion that earlier judgement of Bench of three judges is incorrect, reference to Bench of five judges is justified". Hon ble Members of Bench have not expressed desire to refer matter to Hon ble President for constitution of Special Bench. In view of these circumstances, decision of Hyderabad Bench of Tribunal is bound to be followed. Apart from aforesaid position of law, I am also of considered view that legislature has fixed appeal fee payable by assessee to income as computed by AO. I have referred to various provisions of Act relating to filing of returns and making of assessment by AO and subsequent appellate proceedings before CIT(A) and Tribunal. In CIT vs. Indian Express (Madurai) (P) Ltd. (1983) 33 CTR (Mad) 314: (1983) 140 ITR 705 (Mad), Hon ble Madras High Court has held that there is no dispute about proposition of law that appellate proceedings are continuation of assessment proceedings. Therefore, when CIT(A) or Tribunal modifies income assessed by AO, income so modified will be assessed income unless modified by decision of Hon ble High Court or Hon ble Supreme Court. However, here it is noteworthy that legislature has not used words "assessed income" in isolation as basis for payment of appeal fee to Tribunal. legislature, in its wisdom has consciously used words "the income as computed by AO." As is evident from provisions of Act, ITO computes income while making assessment under s. 143(3) or under s. 144. If assessment is subject-matter of appeal and assessment is modified, AO gives effect to order of appellate authority. Therefore, one has to ascertain income as computed by AO going by plain language used in said statute. legislature could have avoided words "as computed by AO" and based appellate fee to "assessed income" without qualifying same by words "as computed by AO". However, that has not been done. It is well established principle of law that when language of statute is plain and unambiguous, it is not open to any Tribunal or Court to rewrite section. This principle of interpretation has been laid down by Hon ble Supreme Court time and again. To quote instance, Hon ble Supreme Court in case of CIT vs. N.C. Budharaja Co. & Anr. (1993) 114 CTR (SC) 420: (1993) 204 ITR 412 (SC) at p. 426 has held as under: "It would not be reasonable or permissible to rewrite section or substitute words of its own for actual words employed by legislature in name of giving effect to supposed underlying object. After all, underlying object of any provision has to be gathered on reasonable interpretation of language employed by legislature." It is also accepted principle of interpretation that legislature does not use any words in statute, which are superfluous. legislature, having consciously used words "as computed by AO", these words cannot be ignored in arriving at reasonable interpretation of s. 253(6). It is also pertinent to mention that if order is passed by CIT(A) reducing assessed income of assessee, Revenue has right of appeal against such reduction allowed by CIT(A). It may so happen that Tribunal reverses order of CIT(A) in having deleted addition. In that case assessed income on basis of decision of Tribunal would be more than income as modified by CIT(A) and if assessee had also appealed against any of addition sustained by CIT(A), he would be required to pay fees on basis of income assessed by AO if interpretation given by learned AM is accepted. However, in case interpretation put by learned JM is accepted, assessee would pay lesser amount of appeal fee when after decision of Tribunal finally assessed income would be more than income as modified by CIT(A). In my considered view, legislature has consciously put at rest uncertainty about payment of fee by not linking same to modification of assessed income by appellate authorities. assessed income as computed by AO having been chosen as base for payment of fee, intention of legislature has got to be given effect to without venturing to find out as to what would be reasonable amount of fee payable by assessee as appeal fee to Tribunal. It may also be pertinent to mention that legislature, in its wisdom, has not linked fee payable by assessee to income contested in appeal, but has linked same to income as computed by AO. If provisions incorporated by legislature does not seem to be reasonable as per wisdom of Court or Tribunals, legislature is free to incorporate amendment so as to rationalize payment of fee to Tribunal. However, as law stands as of now, assessee is required to pay fee on basis of income as computed by AO at time of making assessment. I accordingly concur with view expressed by learned AM and hold that assessee is required to pay fee on basis of income computed by AO under s. 143(3) without taking into account relief granted by CIT(A). In my considered view, it will be appropriate to ask assessee to pay deficit fee and apply for condonation of delay, which shall have to be considered by Bench in accordance with law. *** KOTHARI DEPARTMENTAL STORES (P) LTD. v. ASSESSING OFFICER