JUDGMENT
J.M. Panchal, J.
1. In this appeal, which is filed under Section 260A of the Income-tax Act, 1961, the appellant has claimed that six substantial questions of law as suggested in para. 20 of the memo of appeal arise for consideration of the court. However, after hearing the parties, we are of the opinion that only one substantial question of law arises for our consideration. The appeal is, therefore, ordered to be admitted and the following question of law is formulated for consideration of the court.
“Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal, Ahmedabad Bench ‘B’, has substantially erred in law in deciding I, T. A. No. 1374/Ahd of 1992 filed by the appellant when the appellant’s advocate could, not remain present under the impression that, hearing of the appeal would be adjourned as was repeatedly adjourned on the ground that the Bombay High Court had not decided special civil application filed by Shri Mrugesh Jaykrishna ?”
2. Mr. M. R. Bhatt, learned counsel, waives service of notice on behalf of the respondents.
3. Having regard to the facts of the case, the appeal is taken up for final disposal today.
4. On March 19, 1985, the Customs authorities had seized US dollars 5,04,526 as well as foreign travellers cheques of the value of US dollars 48,500 and apprehended one Mr. C, S. Amin as well as the appellant at Sahar International Airport, Bombay. The appellant as well as Mr. Amin claimed before the Customs authorities that the foreign exchange seized belonged to one Mr, Mrugesh Jaykrishna who had given the same to them for carrying to Hongkong and the USA. After seizure of the foreign currency, adjudication proceedings were initiated by the Customs authorities under the provisions of the Customs Act as well as the Foreign Exchange Regulation Act and the order in original was passed by the adjudicating authority. In appeal by Mr. Amin, the order of the adjudicating authority was set aside by the appellate authority and the matter was remanded to the adjudicating authority for enhancement of fine imposed on Mr. Mrugesh Jaykrishna. That order is challenged by Mr. Mrugesh Jaykrishna in a petition before the Bombay High Court which has admitted the matter and granted stay of the order impugned therein.
5. After obtaining the information from the Customs authorities, income-tax proceedings were initiated against Mr. Amin and Mr. Mrugesh Jay-Krishna. The assessing authority found that Mr. Mrugesh Jaykrishna was the owner of the money and therefore addition of Rs. 46,57,400 was made in his hands on substantive basis. However, in order to protect the interests of the Revenue and as the money was allegedly seized from the appellant, the assessing authority also made protective assessment of the money found and seized in the hands of the appellant as well as Mr. Amin. The Assessing Officer further added Rs. 6,400 in the hands of the appellant on substantive basis on the statement of the appellant that he had purchased US dollars 400.
6. Subsequently, it was found by the Assessing Officer that, while making addition of the foreign currency found and seized, the wrong exchange rate was applied. He, therefore, reopened the assessment and added Rs. 11,96,191 on account of the difference in the reassessment proceedings.
7. The appellant as well as Mr. Mrugesh Jaykrishna challenged the original as well as reassessment orders made in their hands. The Commissioner of Income-tax (Appeals) confirmed the assessment on substantive basis in the hands of Mr. Mrugesh Jaykrishna, but in the case of the appellant, the addition of the value of foreign currency amounting to Rs. 46,57,400 was deleted. The Commissioner of Income-tax (Appeals), however, sustained the addition of Rs. 6,400. Feeling aggrieved, the Revenue preferred I. T. A. No. 1374/Ahd of 1992 and challenged the deletion of Rs. 46,57,400, where-
as the appellant preferred I. T. A. No. 1160/Ahd of 1992 against the sustenance of addition of Rs. 6,400.
8. As observed earlier, the Assessing Officer had made reassessment to assess the correct income in terms of the Indian rupee as according to him, the wrong exchange rate was applied in computing the rupee value of the dollar in the original assessment. The Income-tax Appellate Tribunal took up and disposed of the appeal arising from the reassessment proceedings and set aside the order of the Commissioner of Income-tax (Appeals) vide its order dated August 17, 1994, following its earlier order dated August 17, 1994, in the case of Mr. Mrugesh Jaykrishna wherein the matter was restored to the file of the Commissioner of Income-tax (Appeals) for a fresh disposal. The appellant, therefore, filed Miscellaneous Application No. 69/Ahd. of 1994 and R. A. No. 1662/Ahd of 1994 against the above referred to order of the Tribunal. On October 12, 2000, Mr. K. H. Kaji, who was appearing as counsel for the appellant, could not attend the hearing assuming that the appeal would be adjourned because the Bombay High Court had yet not decided the writ petition filed by Mr. Mrugesh Jaykrishna. However, the appeal was called on for hearing on October 12, 2000, and a request for adjournment made by the appellant who was personally present before the Tribunal was turned down by the Tribunal. The Tribunal, after hearing the appellant who argued his case jn person, has remanded the matter to the Commissioner of Income-tax (Appeals) by judgment dated October 17,2000, which has given rise to the present appeal.
9. Learned counsel for the appellant submitted that, previously, the hearing of the appeal was adjourned repeatedly on the ground that the Bombay High Court had not decided the petition filed by Mr. Mrugesh Jaykrishna, and therefore, without affording opportunity of being heard to learned counsel for the appellant, the appeal could not have been taken up for hearing by the Tribunal on October 12, 2000. What was urged was that the im-pugned order has been passed in violation of the principles of natural justice, and therefore, the appeal should be accepted.
10. Mr. Akil Kureshi, learned counsel for the Revenue, submitted that the record of the case does not indicate that previously the hearing of the appeal was repeatedly adjourned on the ground that the Bombay High Court had not decided the petition filed by Mr. Mrugesh Jaykrishna and as the appellant had presented his case in person, the impugned order should not be set aside on the ground that sufficient opportunity of being heard was not afforded to the appellant.
11. We have heard learned counsel for the parties and taken into consideration the orders which are produced on the record of the appeal.
12. In para. 7 of the impugned order, the Tribunal has reproduced a part of the Tribunal’s earlier order dated August 17, 1994, rendered in the case of Mr. Mrugesh Jaykrishna which is as under :
“28. We have considered the above submissions regarding the present status of the adjudication order. We have also gone through the appellate order of the Collector of Customs (Appeals) in the case of Shri C. S. Amin and a copy of the writ petition filed by the assessee before the Bombay High Court and the order of the court granting interim stay as stated above. Having considered the above we do not agree with the contention of the learned Departmental Representative that the adjudication order of the Deputy Collector of Customs stands nullified by the subsequent order of the Collector of Customs (Appeals) as ‘remand does not mean nullification’. It is also clear that the operative part of the order of the Collector of Customs (Appeals) directed remanding back the matter on a limited aspect and did not as such quash and set aside the entire adjudication order as a whole. In any case even as per the interim order of the High Court, the aforesaid directions of the Collector of Customs (Appeals) came to-be stayed. Thus, the present status of the adjudication order is in a legal flux. As a matter of fact, the Commissioner of Income-tax (Appeals) has taken contradictory stands inasmuch as while he accepts that the case of the Revenue is based on the proceedings before the Customs authorities the subsequent adjudication proceedings before the adjudicating authority, the Collector of Customs and before the Bombay High Court are not binding on the income-tax authorities. Such a contradictory stand, in our view, has no meaning in the eyes of law. In fact, as stated above, the proceedings before the Customs authorities have not come to an end but are continued before the Bombay High Court. The outcome of such proceedings before the High Court will be decisive in adjudicating upon the ownership of the foreign exchange. Hence, in our considered opinion, it will be desirable on the part of the authorities below to wait till the Bombay High Court decides the vital issue of foreign currency seized by the Customs authorities.
29. To sum up, the issue is restored back to the file of the Commis
sioner of Income-tax (Appeals) to adjudicate de novo keeping in view our
observations/directions (supra) after giving an opportunity of being heard
to both the parties.” ,;
13. The above quoted order makes it evident that the Appellate Tribunal in the case of Mr. Mrugesh Jaykrishria was of the view that the outcome of the proceedings before the Bojnbay High Court was to be decisive in adjudicating upon the question of ownership of the foreign currency. Under the circumstances, we have no hesitation in accepting the claim of the appellant that the hearing of the appeal was repeatedly adjourned by the Tribunal on the ground that the Bombay High Court had not decided the special civil application of Mr. Mrugesh Jaykrishna. In any view of the matter, the record makes it manifest that Mr. K. H. Kaji, learned counsel, was representing the appellant before the Tribunal and when the matter was called on for hearing oh October 12, 2000, he could not remain
present to argue the case for the appellant. If the Tribunal was of the view that, it was not necessary to wait till the outcome of the petition filed by Mr. Mrugesh Jaykrishna, the reasonable request made by the appellant who was present before the Tribunal to adjourn the proceedings to enable his learned advocate to argue the case ought to have been accepted by the Tribunal, more particularly, when the matter has a chequered history and determination of complicated questions of law and facts is involved. In our view, a fair opportunity of presenting the case was not afforded to the appellant by the Tribunal, and therefore, the impugned order is liable to be set aside.
14. For the foregoing reasons, the appeal succeeds. The order dated October 17, 2000, rendered by the Tribunal in I. T. A. No. 1374/Ahd of 1992 which is impugned in the appeal is set aside. As the impugned order is set aside, all the proceedings before the Tribunal shall revive. The Tribunal is directed to dispose of all the proceedings pending before it on the merits and in accordance with law after affording reasonable opportunity of being heard to the appellant. There shall be no order as to costs.