1. Should the Revenue as also the assessee be obliged to litigate up to the Supreme Court of India unnecessarily, and should they be obliged to do so if, without committing any irregularity or illegality or causing injustice or hardship to any side, parties can be saved from being involved in multiplicity of avoidable proceedings and avoidable legal expenses That is the real question which arises in the course of this reference wherein the question referred to us for opinion has been framed reference made on April 27, 1976, as under:
'Whether, on the facts and in the circumstances of the case, the Tribunal rightly vacated the protective assessment framed by the Income-tax Officer ?'
2. The decision of the appeal pending before the Income-tax Appellate Tribunal, Ahmedabad Bench 'C', in respect of the assessee concerned, namely, Surendra Gulabachand Modi, for the assessment year 1958-59, depended on the question as to whether or not, the family of Bapalal Parshottamdas, which was once an HUF came to be disrupted in Samvat year 2020. The assessee concerned has not accepted the view taken by the Revenue in the previous assessment years, namely, in the assessment years 1956-57 and 1957-58, to the effect that the HUF of Bapalal Parshottamdas was not disrupted in Samvat year 2020 as claimed and contended by the assessee. The ITO therefore, made a protective assessment for 1958-59, in order that complication may not arise and the Revenue may to not suffer irreversible detriment if the Supreme Court took a different view on the pivotal question.
3. The question whether the HUF of Bapalal Parshottamdas was disrupted in Samvat year 2020 is pending before the Supreme Court in Civil Appeal No. 186 (NT) of 1971. Since the question is pending before the Supreme Court, the view taken by the Department is in jeopardy. It may or may not be sustained depending on the decision that may be rendered by the Supreme Court. It appears that the ITO made a protective assessment as per order as annex. C dated July 26, 1975, turned done the request made by the assessee by an application dated July 16, 1976, that in view of the fact that the main question as to whether or not the HUF was disrupted as contended by him was pending before the Supreme Court, the appeal before the Tribunal should be adjourned. The Tribunal rejected the prayer made in this behalf on the sole ground that the matter was very old and that inasmuch as the decision was being rendered in favour of the assessee, no hardship was likely to be caused. The request of the assessee was under the circumstances turned down. The appeal was consequently allowed and the protective assessment was set aside.
4. Now, when the validity of the alleged Partition was the very question which was pending before the Supreme Court, the outcome of the appeal before the Tribunal depend upon the ultimate decision of the Supreme Court. The request of the assessee to block the matter by adjuring it till the appeal in question, namely, Civil Appeal No. 156 (N.T.) of 1971 (sic) pending in the Supreme Court was finally disposed of, was a legitimate request. It this prayer was not granted the parties would be required or obliged to challenge the decision rendered by the Tribunal by applying for a reference to the High Court and carrying the matter further to the Supreme Court. When multiplicity of proceedings can be avoided and parties can be saved from unnecessary expenditure, it was legal and proper as also pragmatic to grant the request to block the proceedings and to adjourn the matter awaiting the decision of the Supreme Court on the crucial question on which the decision of the appeal would ultimately turn. The mere fact that the matter was old and would have remained on the file of the Tribunal was no legal or valid ground for driving the parties to a number of avoidable proceedings in higher courts and obliging them to incur avoidable expenditure. In our opinion, therefore, the ends of justice demanded that the request be granted. So, also, legality, propriety and pragmatic considerations demanded that the request was granted, for ultimately, the paramount consideration must be to avoid multiplicity of proceedings, to avoid unnecessary litigations and to save the parties from unnecessary costs required to be incurred in connection with such proceedings, if there was no prejudice to any side. These considerations have not been taken into account by the Tribunal. It has not even shown an awareness of this vital dimension of the matter. The request has been turned down merely on the ground that the matter was old. The matter would have continued to remain old even if the parties were obliged to carry the matter initially to the High Court and, subsequently, to the Supreme Court, and the matter would have remained old and indisposed of till the Supreme Court finally decided the crucial question on the decision whereof one way or the other, the matter turned on merits.
5. Accordingly, the only question referred to us is answered as under:
----------------------------------------------------------------Question Answer----------------------------------------------------------------Whether, on the facts and in the No.circumstances of the case,the Tribunal rightly vacated theprotective assessment issuedby the Income-tax Officer ?
6. The resultant conclusion is that the Tribunal was not justified in proceeding with the matter and in disposing of it instead of blocking it till the disposal of the matter pending in the Supreme Court in order to bring it in conformity with the view of the Supreme Court. It was also not justified in vacating the protective assessment made by the ITO. The Tribunal will now take necessary steps in order to give effect to our opinion expressed herein and keeping it (the appeal) alive and pending awaiting the decisions of the Supreme Court in Civil Appeal No. 156 (NT) of 1971 (sic).
7. Reference is answered accordingly. No order as to costs.