Law:

Section:

When Tribunal follows certain principles, it cannot shirk its responsibility after laying down principle of law without applying same to facts and circumstances of case at hand, even though it might go in favour of assessee who had not preferred any appeal Section 254 of the Income-tax Act, 1961 - Appellate Tribunal - Orders of - Assessment year 1990-91 - Whether when Tribunal follows certain principles, it cannot shirk its responsibility after laying down principle of law without applying same to facts and circumstances of case at hand, even though it might go in favour of assessee who had not preferred any appeal - Held, yes - Whether in case on principle laid down it appears that order appealed against is contrary to principle so laid down then Tribunal cannot allow order to remain intact after having laid down law unless there are other reasons for not interfering with order - Held, yes - Whether cannot leave matter in a fluid state deciding principle in favour of one of parties and passing an order in favour of other against whom principle has been laid down - Held, yes FACTS The assessee was carrying on the business of undertaking contracts in respect of which mobilisation fees were being received from time to time. Initially, the assessee used to maintain accounts on the basis of the completion of the contracts; but from the assessment year 1988-89, the assessee had changed the mode of accounting and started showing receipt of mobilisation fee on the basis of pro rata performance of the contract in that particular assessment year and offered it to tax. In respect of the assessment years 1988-89 and 1989-90, the Commissioner (Appeals) had held that the amount would become taxable on the completion of the contract when the bank guarantee would be released and, thus, post- poned the taxability till the completion of the contract. On second appeal, the Tribunal by a consolidated order had laid down the principle of pro rata receipt of the mobilisation fees on the basis of the pro rata performance of the contract and did not agree with the postponement of the taxability till the completion of the contract and had allowed these two appeals with regard to these…

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