Substantial Question of Law – Appeal to High Court – High Court cannot decide the appeal without framing a question of law.

The Revenue filed connected wealth-tax appeals against the order of the Tribunal holding that cash in hand in excess of Rs.50,000 in the hands of the assessee who were all individuals, did not form part of the asset u/s. 2(ea)(vi) of the Wealth-tax Act. The High Court allowed the appeal holding that cash in hand in excess of Rs.50,000 held by the individual assessees formed part of assets under section 2(ea)(vi). The individual assesses approached the Supreme Court. The learned counsel for the assessee’s contended that the High Court had committed an error by not framing substantial question of law as per the provisions of section 27A(3) of the Wealth-tax Act, 1957. The Supreme Court held that the appeal under the aforesaid section could be admitted only when a substantial question of law is involved in the appeal and according to s/s. (4), of the question of law has to be formulated by the High Court.

The Supreme Court found that the such a question had not been framed and without framing question of law, the appeal had been decided by the High Court. The Supreme Court therefore remitted the matter to the High Court so that a substantial question of law could be framed, if any, and the appeal be heard again.