1. The Income-tax Appellate Tribunal, Indore, has made this reference under Section 26(1) of the Gift-tax Act, seeking our opinion on the following question:
'Whether, on the facts and in the circumstances of the case, the order of the GTO should not only have been set aside but annulled altogether?'
2. The facts out of which this question arose are very simple. Applicant, Manaklal Motilal Agarwal, was carrying on the business of plying passenger buses for the last many years. On August 21, 1968, he converted this proprietary business into a partnership business transferring 25% share to his son, Jawaharlal, and 12.5% each to Arvind Kumar and Subhas-chandra. Gift-tax proceedings were initiated by the GTO under Section 16 of the G.T. Act. In response to the notice the assessee filed a nil return and contended that the transaction did not amount to a gift. The GTO estimated the value of the gift at Rs. 2,26,100 and assessed it accordingly. On appeal, the Commissioner of Income-tax (Appeals) held that the transaction amounted to a gift and the assessee was liable to pay gift-tax thereon. He, however, found that the GTO did not afford proper opportunity to the assessee for valuation of the assets and calculation of the goodwill. He, accordingly, set aside the assessment and remanded the case to the GTO to make a fresh assessment after giving full opportunity of being heard to the assessee.
3. The assessee went in second appeal before the Appellate Tribunal. His contention before the Tribunal was that the order of the GTO lacked basic details and it was incomplete. The assessee prayed that the said order of the GTO should have been quashed altogether and not merely set aside with a further direction to make a fresh assessment. The Tribunal rejected this contention and held that in the circumstances of the case the Commissioner (Appeals) was justified in setting aside the assessment and remanding the case to the GTO for recomputation.
4. As the facts stated by the Tribunal show, the question before the Tribunal was whether the Commissioner (Appeals) should have quashed the assessment instead of remanding the case to the GTO with the direction to make a fresh computation. It is clear that the Commissioner (Appeals) has the jurisdiction, under Section 22(5) of the G.T. Act, to pass such order as he thinks fit which will include an order of remand. It was not obligatory on his part under the scheme of the Act and the powers conferred on him to quash the order of the GTO. Learned counsel for the assessee was unable to show in what manner the order of the Appellate Tribunal confirming the jurisdiction of the Commissioner (Appeals) to remand the case was contrary to law.
5. We, therefore, hold that, on the facts and circumstances of the case, the Appellate Tribunal was right in holding that Commissioner (Appeals) had the power as well as justification to set aside the GTO's order and remand the case to him instead of quashing his order.
6. Costs of this reference will be borne by the assessee-applicant. Advocate's fee Rs. 150, if certified.