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Grounds of Appeal

1. Brief Background

   A person has no inherent right of appeal; the right can exist only if it is given by the statute. It follows, as a corollary, that the right of appeal is limited to the extent permitted by the statute granting it. Thus, an appeal, which is a creature of the statute, is subject to the conditions and the restrictions imposed by the statute. At the same time, this substantive right of appeal conferred upon an assessee by the statute cannot, in any way, be curtailed or restricted by the language of the rules made under subordinate legislative powers. If a rule attempts to so curtail or restrict the right of appeal, such rule, to that extent, can be declared as ultra vires. Similarly, rules of limitation pertain to the domain of adjectival law and they operate only to bar the remedy but cannot extinguish the right. Thus, the statutes pertaining to right of appeal have to be given a liberal construction since they are remedial in nature. A right of appeal cannot be restricted or denied unless such a construction is unavoidable. As such, when substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred. The eventual destination of every litigation is justice and, as such, technicality should not be permitted to prevail as speed-breaker in the course of dispensation of justice.

   Further, it is open to the law-maker to provide more than one remedy to the aggrieved party and so long as such remedies are available, the aggrieved party can certainly invoke them. In view of this, there is no limitation on the exercise of the appellate power in the statute on the ground that the assessee had invoked the revisional power unsuccessfully.

   With this little background, let me straightway deal with the subject proper.
    

2. The appeal provisions

   Chapter - XX of the Income-tax Act, 1961 ("the Act"), which deals with provisions relating to Appeals and Revision, contains sections 246 to 255, which deal with appeals. Relevant rules are provided in Rules 45 to 47 of the Income-tax Rules, 1962 ("the Rules"). Similarly, Income-tax (Appellate Tribunal) Rules, 1963 ("the Appellate Tribunal Rules") govern proceedings before the Appellate Tribunal. Moreover, sub-section (5) of section 255 empowers the Tribunal to regulate its own procedure in the matters arising out of the exercise of its powers or of the discharge of its functions. However, as explained in the beginning, such rules do not curtail or circumscribe the power/ authority/ jurisdiction of the Tribunal. Ultimately, it is always the solemn duty of the Tribunal to see that correct liability is assessed. It is to be seen that there is no inflexible adherence to law of procedure and, in that process, to deny the assessee the benefit to which he is otherwise entitled in law.

   Needless to say, importance of proper drafting of grounds of appeal and statement of facts can never be over emphasised, especially when certain rules seek to contain or curtail these vital rights of an assessee. Section 249, together with rule 45, provides for the form of appeal and its limitations for first appeal before CIT (A). Accordingly, the form of appeal (Form 35) together with Grounds of Appeal shall be signed and verified by the person who is authorised to sign Return of Income as provided u/s. 140. This verification clause applies to grounds of appeal also. Similarly, section 253, together with rule 47, provides for the form of appeal and its limitations for second appeal before the Tribunal. Further, Rules 6 to 9 of the Appellate Tribunal Rules prescribe the actual procedure for filing of appeal before the Tribunal. Accordingly, the form of appeal (Form 36) together with Grounds of Appeal shall be signed and verified by the person who is authorised to sign Return of Income as provided u/s. 140.

   However, absence of, or defect in, the signature of the appellant in the memorandum (and also grounds of appeal) is not an illegality or fatal but only an irregularity which can be rectified by an amendment. As held by the Bombay High Court in the case of Malani Trading Co. v/s. CIT - [(2001) 252 ITR 670], a defective appeal cannot be rejected straightway, without giving an opportunity to the concerned appellant to rectify it. Similarly, signing with an incorrect status or capacity may, at the worst, be deemed as a misdescription, for which a right of appeal cannot be taken away. As per Rule 12 of the Appellate Tribunal Rules, a memorandum of appeal that is not in proper form may be rejected by the Tribunal or the Tribunal may return it for being amended within such time as it may allow. The so amended appeal may be represented and considered for further action. The amendment takes effect from the date when the appeal was originally filed. This is because the limitations prescribed in this regard apply to filing of appeal and not to the amendment. In view of this, though admission of additional ground is at the discretion of the appellate authority, the authority cannot refuse to grant permission to raise additional ground, by way of amendment in the memorandum of the appeal filed, on the ground of limitation for filing appeal.
    

3. Additional Ground

   Section 250(5) empowers the first appellate authority to allow the appellant to go, at the time of hearing of an appeal, into any ground not taken in the grounds of appeal; provided that such omission was not willful or unreasonable. Similarly, Rule 11 of the Appellate Tribunal Rules provides that the appellant shall not, except by leave of the Tribunal, urge or be heard in support of any ground not set forth in the memorandum of appeal, but the Tribunal, in deciding the appeal, shall not be confined to the grounds set forth in the memorandum of appeal or taken by leave of the Tribunal under this rule; provided that the Tribunal shall not rest its decision on any other ground unless the party who may be affected thereby has had a sufficient opportunity of being heard on that ground.

   In the context of the power of the first appellate authority u/s 250(5), it has been held that it will be erroneous to think that section 250(5) confers a new power upon the first appellate authority. The provision should be looked upon as controlling the discretion of the first appellate authority with regard to its right to refuse an appellant to raise a new ground and the legislature suggests that, ordinarily, the first appellate authority should allow a new ground to be taken unless it is satisfied that the omission on the part of the appellant was willful and unreasonable {see, Ramgopal Ganpatrai & Sons Ltd. v/s. Commissioner of Excess Profit Tax - [(1953) 24 ITR 362, 372 (Bom)]} This discretion (to allow additional ground) has to be exercised judicially and if it is found that the discretion has not so been exercised, it can be interfered with and corrected by the higher authorities or the High Court. Merely because a ground was not taken in the memo of appeal, the party should not suffer; denial to take up an additional ground, if it is necessary for proper adjudication of the matter, will amount to denial of justice. This applies to the second appellate authority as well. The Full Bench of the Bombay High Court (in Ahmedabad Electricity Co. Ltd. vs. CIT - [(1993) 199 ITR 351 (Bom)] had occasion to deal with the issue of additional ground before the Appellate Tribunal. After exhaustive analysis of the legal position, the Court held that Rule 11 together with Rule 29 of the Appellate Tribunal Rules (regarding production of additional evidence before the Tribunal) indicate that the scope of inquiry before the Tribunal can be wider than the points which are raised before the Tribunal. The Tribunal, therefore, would ordinarily have the power to allow additional points to be raised before it so long as they arise from the subject matter of the proceedings and not necessarily only the subject matter raised in the memorandum of appeal. The word 'thereon' in section 254 does not in any manner restrict the jurisdiction of the Appellate Tribunal. The words which prescribe the extent of jurisdiction of the Tribunal under Section 254 are the words "may pass such orders ... as it thinks fit."

   Accordingly, it can be said that the Tribunal has jurisdiction to permit additional grounds to be raised before it even though they may not arise from the order of the first appellate authority, as long as these grounds are in respect of the subject matter of the entire tax proceeding; provided, of course, ample opportunity is given to the other side to meet these new grounds of appeal. Gainful reference can also be made to the old Supreme Court judgment in the case of Hukumchand Mills Ltd. vs. CIT - [(1967) 63 ITR 232, 237-8 (SC)] wherein the apex court has held that Rules 12 and 27 of the Appellate Tribunal Rules, 1946 (pari materia with Rules 11 and 27, respectively, of the present Appellate Tribunal Rules) are not exhaustive of the powers of the Appellate Tribunal. The rules are merely procedural in character and do not, in any way, circumscribe or control the power of the Tribunal u/s. 254(1). However, due note also need be taken of the Full Bench Andhra Pradesh High Court judgment in case of CIT v/s. Late Begum Noor Banu - [(1993) 204 ITR 166 (AP) (FB)], wherein this Bombay High Court view has been dissented from.

   In any case, an assessee can be permitted to expand his claim by including therein certain items on the same subject matter.

   As regards the procedure, there is no prescribed rule of limitation for filing additional ground; the same can be filed at any time before the appeal is decided. The appellant can make such request for leave to urge additional ground any time before or at the time of hearing. Strictly speaking, such leave need not be in writing, it can be oral also. All that is required is a permission to raise additional ground and a proper notice to the other side so that it should know what challenge it has to meet. In fact, the Tribunal is competent to allow the appellant to raise, at the time of hearing of the appeal, an additional ground even without a formal amendment of the memorandum of appeal. Further, there is also no requirement that application urging additional ground be verified or should bear court fee stamp. Moreover, leave to urge a new plea or to take up a new ground may be implied and the very fact that it was taken up, urged and considered may be taken into account to show that it was formally granted.

   However, it is desirable to seek such leave in writing, setting forth clearly the additional grounds so raised and the reasons leading to the same. Further, it is also desirable to see that the application for the additional ground is properly registered /filed and to see that the same is disposed of / heard either earlier or along with the appeal.

   It may not be possible for an appellant to raise additional ground when the appeal is before Third Member.
    

4. Claim made for the first time

   Generally, if there is no decision of the first appellate authority (and no ground is taken in the appeal filed before him) on a particular portion of the assessment, it cannot be said that the assessee is aggrieved by the decision of the first appellate authority in not granting such relief to him. On the other hand, there is nothing in the Act or the Rules or the Appellate Tribunal Rules which prevents a party from taking a ground in the memorandum of appeal before the Tribunal, which it had not urged before the first appellate authority or the assessing officer. Nor there is anything which prohibits a party from raising a ground in the memorandum of appeal, which may require the Tribunal to investigate into a question of fact, provided the appellant, in so doing, does not ask for permission to lead additional evidence in support of the ground raised by him in the memorandum of appeal. What a party is not entitled to do before the Tribunal, without first obtaining the leave of the Tribunal, is to urge a ground which it had not mentioned in the grounds of appeal or to lead additional evidence, either documentary or oral or by way of filing affidavits. Of course, the Tribunal may refuse permission to the appellant to raise a new ground of fact for the first time which necessitates for its decision the production of fresh evidence, even though the Tribunal at an earlier stage had granted permission to produce affidavits and other evidences pertaining to the new ground. However, a pure question of law or a plea which could be considered on the evidence already on record can, for the first time, be raised and pleaded before the Tribunal. On such plea being taken, the Tribunal is under statutory obligation to entertain the plea and decide the same, no matter at what stage it was taken. Similarly, question of limitation / jurisdiction can be raised before the Tribunal, though the assessee did not raise such question before the assessing officer or the appellate authority, provided such question can be decided on the basis of the facts on the record. This is on the reasoning that a question of limitation raises a plea of want of jurisdiction and it is a question of law. Same consideration will apply if such point to be raised goes to root of the question. In view of this, even if specific challenge to reassessment proceeding on the ground of limitation was not taken up earlier, the challenge to the entire reassessment proceeding is enough for the Tribunal to adjudicate upon the validity of reopening. However, a contention based on the regularity of the proceeding or otherwise cannot properly be allowed to be urged for the first time in an appeal unless such irregularity in the proceeding occasioned grave failure of justice. Similarly, in explaining the delay in filing the return, the assessee is not required to incorporate all the reasonable causes in the explanation to the officer and the Tribunal will be justified in considering a cause not so incorporated in such explanation. Similar considerations will apply with respect to the powers and/or duties of first appellate authority while entertaining a claim for the first time. Apart from any statutory restriction, it is the inherent jurisdiction of every appellate authority to deal with the order appealed against on any ground of law that is applicable to the facts or circumstances of the case. Similarly, merely because an appellant would have succeeded on question of law before the authority below can surely be no ground for debarring the appellant from taking that ground for the first time before an appellate authority. It, therefore, follows that the first appellate authority should entertain and consider a claim where the claim was not made before the assessing officer but there was evidence or material on record to support such claim. At the same time, the Tribunal cannot be said to have exercised its discretion arbitrarily if it refuses to permit a party to raise an entirely new point involving additional evidence or investigation into fresh facts, which point was within the knowledge of the party and could have been raised at an earlier stage. Still, it is only in a case where the assessee had an opportunity to put forward a plea but fails to avail of that opportunity before the assessing officer, it could be said that he cannot raise such a plea before the appellate authority for the first time. Gainful reference can also be made to the Supreme Court judgment in the case of Jute Corporation of India Ltd. vs. CIT - [(1991) 187 ITR 688, 694-95 (SC)] which distinguished its earlier judgment in Gurjargravures (P) Ltd.'s case [ (1978) 111 ITR 1 (SC)] - where it was held that the appellate authority was justified in not entertaining a claim for exemption that was neither made before the assessing officer nor there was any material on record supporting such a claim - and held, though not specifically overruling the same, that the said earlier judgment should be taken to be an authority on the particular facts and circumstances of that case only. Similar view has been adopted by the Bombay High Court in CIT vs. Western Rolling Mills (P) Ltd.- [(1985) 156 ITR 54 (Bom)]. Gujarat High Court had, in a case reported in New India Industries Ltd. vs. CIT - [(1994) 207 ITR 1010 (Guj)], occasion to go through the decision of the Supreme Court in Jute Corporation's case and summarised its ratio, in nutshell, by observing as follows:

   "It is evident that over and above the cases where a claim is made but there is no material on record or where material is on record but no formal claim is made, an assessee can, even when no claim is made and no material is on record, request the appellate authority to permit him to raise an additional point on the ground that the assessee could not raise that point earlier for justifiable reason."

   The issue seems to be concluded by the later judgment of the apex court in the case of National Thermal Power Co. Ltd. - [(1998) 229 ITR 383 (SC)], wherein the Court has held that there is no reason to restrict the power of the Tribunal under section 254 only to decide the grounds which arise from the order of the CIT (A). The Tribunal should not be prevented from considering questions of law arising in assessment proceedings, although not raised earlier. The Court, in fact, applied the observations of the Court in Jute Corporation's case - which were with respect to the power of first appellate authority - to the power of the Tribunal.

   At the same time, a note may also be taken of the Punjab & Haryana High Court decision in CIT vs. Oswal Woollen Mills Ltd.- [(1987) 163 ITR 484 (Punj)] wherein it has been held that when all material is available on record, a relief claimed at appellate stage on basis of that material is not a fresh claim. Similarly, expansion of a claim is not to be regarded as raising a new claim. As such, the Tribunal, for the first time, can deal with another aspect of the same addition. In any case, even where the consequences of acceptance of an assessee's plea would involve granting a larger amount as deduction than was demanded at the stage of assessment, the Tribunal would have jurisdiction to consider such a plea. Similarly, where an assessee has made a claim at assessment stage, though for a lower amount, a claim could not be shut out in limine at appellate stage merely because the appellate authority has to go into a larger question in a matter of quantum on same subject of claim, or because the claim is sought to be put forward from a different angle.

   Similarly, the Tribunal can take up a ground for consideration, which apparently was conceded before the first appellate authority.
    

5. Cross-objections to an Appeal

   If an assessee or the assessing officer exercises his right under Section 253(1) or (2), as the case may be, and prefers an appeal to the Tribunal against an order of the first appellate authority and the appeal is not rejected in limine under rule 12 of the Appellate Tribunal Rules, a notice is given by the Tribunal to the respondent informing him of the fact of such filing, also enclosing the memorandum and grounds of appeal. Section 253(4) enables the respondent to file, within thirty days from the date of receipt of such notice, a memorandum of cross-objections, in Form No.36A, against any part of the order of the first appellant authority.

   The respondent has been given such right even though he himself has not filed any appeal to the Tribunal against the order of first appellate authority. The right to file a memorandum of cross-objections is an independent right given to the opposite party in an appeal and it is in addition to the independent right of appeal which may or may not be exercised by the assessee under section 253(1) or by the assessing officer at the instance of the Commissioner under section 253(2) of the Act. It is not possible to read any restriction in section 253(4), which has the effect of restricting this right to file a cross-objection. In a given case, it is quite possible that certain matters may not be agitated either by the Commissioner or the assessee by way of appeal, but if any appeal is filed either by the assessee or the assessing officer, then the opposite party might consider it necessary to file a cross-objection in respect of such matters which were not thought fit originally to be agitated by way of an independent appeal. It is common experience that orders under the Act decide several questions of controversy between the Revenue and the assessee and if, in a given case, either party chooses to restrict his appeal only to certain questions or findings, having regard to a positive right to file a cross-objection, he can, on second thoughts, be permitted to challenge the finding which not originally challenged in the appeal, provided, of course, the cross-objection is filed in the manner prescribed by law. Therefore, a cross-objection filed by an assessee can not be rejected on the ground that the assessee has already preferred an appeal. Further, the cross objections need not be confined to the points taken by the opposite party in the main appeal. The word "against any part of the order ..." of the CIT (A) are wide enough to cover a situation, for example, where the Revenue has challenged the order of the CIT (A) on the merits regarding the quantum of the tax liability, but the assessee in cross-objections can challenge the order of the CIT (A) not only on the quantum of the tax amount but also on other points. On a point of law, there is no difference between an appeal and a cross objection.

   There is no fee prescribed for filing of such cross-objections. Rule 22 of the Appellate Tribunal Rule stipulates that a cross objection so filed shall be registered and numbered as an appeal and all the rules, so far as may be, shall apply to such appeal.

   At the same time, where the assessee has succeeded wholly before the first appellate authority, there is no scope for filing a cross-objection. Importance of filing cross-objections can be gauged from the Allahabad High Court judgment, reported in Pahulal Ved Prakash v/s. [(1990) 186 ITR 589 (All)], wherein it has been held that the Tribunal, while dealing with the appeal, in absence of any cross appeal or objection, cannot give a finding adverse to the appellant which would make his position worse than that was under the order appealed against.
    

6. Applications u/s. 158A

   If an assessee claims that a question of law arising in his case for a particular assessment year, pending before the assessing officer or any appellate authority, is identical with the question of law arising in his case for another assessment year and reference or appeal in respect thereof is pending before the High Court or the Supreme Court, the assessee can furnish a declaration in Form 8 to the effect that the decision in the pending reference/ appeal shall govern the case so pending before the authority. This will help to avoid repetitive appeals. Such declaration can be filed only by the assessee, either before the assessing officer or the appellate authorities. It may be noted here that the reference / appeal must be pending in the assessee's own case and not in some other assessee's case, even if the issue is identical. In practice, however, it is noticed that this provision is not being much availed of by the assessees in general.
    

7. The Procedure

   As regards appeal before Tribunal, the Appellate Tribunal Rules lays down the procedure. Attention may be paid to the suggestions made by the Registrar for guidance of assessees with regard to the appeals, applications and cross-objections filed before the Tribunal as reported in 79 ITR (Journal) 1. Similarly, attention may be paid to the Notice issued by the Registrar regarding recommendations of the Mallimath Committee, which is reported on page 50 of the Income Tax Review, January 1994. It should be noted that these are only recommendatory in nature and are not mandatory.
    

8. The Fees

   As regards the fees payable for filing of appeals, it should be noted that there was no fee payable while filing an appeal before the first Appellate authority. However, with effect from 1-10-98, for the appeals filed on or after that date, a scale of fees is prescribed by the Finance Act, 1998 which is based on the assessed income by the Assessing Officer, which is as under -
   
   Assessed Income Fees

   a.	One hundred thousand rupees or less than one hundred thousand rupees	Rs. 250
   b.	More than one hundred thousand rupees but less than two hundred thousand rupees	Rs. 500
   c.	More than two hundred thousand rupees	Rs. 1,000
   d.	Where the subject matter of appeal is not covered under either of the above	Rs. 250
   	In case of appeals under the W.T. Act and other Acts	Rs. 250

   
   Similarly, the revised structure of the fees payable for appeals preferred before the Tribunal is as under -

   1. Where assess total income is Rs. 1 Lakh or less fees payable is Rs. 500/-.

   2. Where assess total income is more than Rs. 1 Lakh but not more than Rs. 2 Lakh fees payable is Rs. 1,500/-.

   3. Where assess total income is more than Rs. 2 Lakh 1% of assessed Total Income or Rs. 10,000/- wherever is less is the fees payable.

   4. Fees payable for Stay Application is Rs. 500/-.

   5. Fees payable for Miscellaneous Application is Rs. 50/-.

   The term `assessed income' for this purpose, it seems, means assessed as per the original order, not as per the revised income recomputed in the order giving effect to the appellate order. Similarly, as per the latest ruling by the Special Bench of the I.T.A.T., Kolkata, in the case of Bidyut Kumar Sett v/s. ITO - [(2005) 92 ITD 148 (Kol) (SB)], in a case of concealment penalty u/s 271(1)(c), appeal against such order will be governed by clause (a), (b) or (c), as the case may be, and not by the residuary clause (d). As regards the fee with respect to an assessment order assessing loss, though the view being vigorously canvassed is that the negative should be ignored, this view is not free from doubt.

   It should also be noted that as per the provisions of Section 249(4), no appeal before the first appellate authority can be admitted unless, at the time of filing of the appeal, where a return had been filed by the assessee, the assessee has paid the entire tax due on the income returned by him. Where no return has been filed by the assessee, the assessee should have paid an amount equal to the amount of advance tax which was payable by him. For this purpose, the tax due does not include interest element. It should be kept in mind that there is no power given to any authority to exempt any assessee from operation of this provision as far as the cases where a return has been filed by the assessee are concerned. In such a case, to be on a safer side, it is advisable to pay such tax as soon as possible, preferably before the appeal is taken up for hearing, and seek for condonation of delay in filing the appeal on a proper ground. However, in a case where no return is filed, the power is given to condone such delay in making the payment for any good or sufficient reason.
    

9. Miscellaneous
    

   1. The Tribunal, in deciding a case, should not be unduly influenced by trivial procedural technicalities. The memo of appeal should be liberally seen and entertained. No specific formula is necessary for seeking relief at the hands of a court or Tribunal, if the necessary grounds have been taken in the appeal memo. {CIT vs. Calcutta Discount Co. Ltd. - [(1973) 91 ITR 8, 11 (SC)]}
       

   2. As regards an appeal before the Tribunal, in supporting the decision of the first appellate authority, the respondent may support it on any ground other than the one on which the first appellate authority had come to his conclusions. But such a ground must arise on the records of the assessment proceedings and the facts in respect thereof should be on record. No new ground can, generally, be allowed to be raised for the first time before the Tribunal by the respondent. Thus, when the department files an appeal for an increase in the assessed income, the subject matter of the appeal is the increase claimed by the department and the assessee respondent can urge any ground of defence, even though it might have been rejected by the first appellate authority, for showing that there should be no increase. That the assessee is not liable to be assessed at all is also a ground for showing that there should be no further increase and the assessee may resist the appeal on this ground also. In an appeal filed by the Revenue, granting relief to the assessee on a ground other than the ground given by the CIT (A) is within the powers of the Tribunal. The right of an assessee is not restricted to the pleas raised by him.
       

   3. A ground not taken in the appeal against original assessment may be taken in an appeal against fresh assessment after remand when it relates to jurisdiction of the assessing officer to make the assessment. However, in reassessment proceedings, a claim, which has been disallowed in the original assessment order, cannot be permitted to be agitated again. Similarly, if the correctness of the remand order is not challenged through appropriate proceedings, it will not be open to review it when the matter comes again before that authority in appeal. As such, a direction of CIT (A) in an earlier order cannot be agitated in an appeal against his later order. Similarly, in an appeal against penalty, it is not open for the aggrieved assessee to challenge validity of assessment order.
       

   4. if, for the reasons recorded by the departmental authorities in rejecting a contention raised by the assessee, grant of relief to him on another ground is justified, it would be on to the departmental authorities and the Tribunal, and indeed they would be rather under a duty, to grant that relief. The right of the assessee to relief is not restricted to the plea raised by him. {see, CIT v/s. Mahalaxmi Textiles Mills Ltd.- [(1967) 66 ITR 710, 713 (SC)]} At the same time, the Kerala High Court in CIT v/s. Cochin Refineries Ltd. - [(1988) 173 ITR 461 (Ker)] has held that if a party before the Tribunal is aggrieved by a particular finding, it ought to have challenged the same in order to avail a relief on that court. Where no relief on a particular point is sought for by the aggrieved party, it is not, ordinarily, within the jurisdiction of the Tribunal to grant such a relief which was not sought before it.
       

   5. Consent does not give jurisdiction to any authority and if there is an inherent want of jurisdiction in an authority, the failure of the aggrieved party to challenge the jurisdiction of the said authority or it giving in to or accepting such jurisdiction will not estopped the aggrieved assessee to challenge the jurisdiction before higher authority in an appeal.
       

   6. If, by an order u/s. 263, Commissioner makes some observations which are not tentative conclusions and, after recording clear findings on the controversial points, decides the issues on merits, then it will be open to the Tribunal, on an appeal filed by the aggrieved assessee, to go into the merits of the assessee's claim and arrive at opinion or conclusion after considering the records and facts and circumstances of the case. In such a case, if the Commissioner takes the view that the assessment should be made afresh since it is not made after proper inquiries, the proper course for him would be not to express any final opinion as regards the controversial points.
       

   7. Though a particular claim is made in profit & loss account, nothing prevents an assessee to put a different claim in the final computation sheet submitted before the assessing officer or, as a matter of fact, before higher authorities. This is on the reasoning that there is no estoppel against statute. Similarly, the principle of res judicata strictly does not apply to income tax proceedings and, therefore, an assessee can always challenge an action of the assessing officer in a particular year, even though he might have not agitated - and accepted - such action in past. However, one should be care full while relaying upon such principles and the same should not be tired to be extended to the level of absurdity or unfairness.
       

   8. If, during the progress and passage of proceedings from the taxing authority to appellate authority, subsequent events occur, the appellate authority has to examine and evaluate the same and mould the relief accordingly. This is so because for making the right or remedy claimed by the party just and meaningful, as also legally and factually in accord with the current realities, the appellate authority can, and in many cases must, take cognizance of events and developments subsequent to the institution of the proceedings; provided the rules of fairness to both the sides are scrupulously obeyed. As such, a ground/ additional ground based on the event occurring subsequent to the date of the order challenged can, in appropriate case, be entertained.
       

   9. ix. Where an assessee has made a statement of facts, he can have no grievances if the taxing authority taxes him in accordance with that statement. If he can have no grievances, he can file no appeal. Therefore it is imperative, if the assessee's case is that his statement had been wrongly recorded or that he made it under mistaken belief of fact or of law, that he should make an application for rectification to the authority who passed the order based upon the statement. Until rectification is so made, an appeal is not competent. [Rameshchandra & Co. v/s.- [(1987) 168 ITR 375 (Bom)]
       

   10. Appeal can certainly be preferred against a protective assessment, the challenge can be on the ground that the assessee denies his liability to be assessed under the Act or objects to status under which he is assessed, as the case may be.
        

10. Practical Hints

    There is no specific format or strait jacket formula for preparation of grounds of appeal. It should be kept in mind, while preparing grounds of appeal, that basically they serve the purpose of intimating the appellate authority the issues on which the appellant is aggrieved and the background giving rise to the same. Detailed arguments and contention are to be reserved for the hearing of the appeal. At the same time, the appellate authority should - and is entitled to - know, so also the respondent, about all the alternative pleas and prayers on which the case of the appellant rest. The following are some of the points that should be kept in mind in this regard:
     

    1. Grounds of appeal should be precise and not vague or argumentative. In this regard, a Bombay Tribunal decision in R.S. Insulator Corporation of Gujarat v/s. ITO should be kept in mind, wherein the Tribunal dismissed the appeal of the assessee, following the Delhi Tribunal decision reported in 38 ITD 320, on the ground that the grounds of appeal were not in conformity with the Rule 19 (2) of the Appellant Tribunal Rules. At the same time, even if a ground is vague, if it is specifically argued, the Tribunal cannot refuse to adjudicate it.
        

    2. It is better if the main or the most important ground is taken first and second most important ground thereafter and so on. This will help both, the appellant and the appellate authority.
        

    3. Issue-wise proper heading and numbering should be done.
        

    4. All the alternative pleas should be incorporated and nothing should be left out to be raised at the time of hearing.
        

    5. Statement of facts should also be precise and should contain only facts and not arguments. Unnecessary details should be avoided.
        

    6. The above points will equally apply to the prayers contained in the memo also.
        

    7. If an appeal is filed belatedly, application for condonation of delay, explaining the reasons, supported by evidences and the requisite affidavit, should be filed along with the appeal and the appellant should not wait till the preliminary objection is taken at the time of hearing.
        

    8. When an appeal is filed against the order of CIT (A), the respondent has to be Assessing Officer who has passed the order. When appeal is filed against the order of Commissioner under section 263, the respondent has to be Commissioner.
        

    9. When appeal is filed against penalty order under section 271(1)(c), Assessment Order is also required to be furnished, alongwith appeal.

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