2004 (6) TMI 14 - HC - Income Tax

Consolidated appeal - court fee - Since the consolidated appeal represents different causes of action giving rise to separate appeals since consolidated into one therefore court fee would be payable in respect of each appeal under section 260A - in an appeal under section 260A of the Income-tax Act 1961 against one consolidated order it would be open to the respective parties to make good the deficit court fees as may be directed by the court or before the ultimate order is passed. In the event deficit court fees are not paid then the order passed on such consolidated appeal would not be effective so far as the defaulting party is concerned. The deficit court fees may be paid within six months or at the time of disposal of the appeal as the case may be or within such time as the court may extend.

Summary

Issues Involved:
1. Whether one appeal under section 260A of the Income-tax Act, 1961, can be maintained against a consolidated order disposing of several appeals by the Tribunal.
2. The prevailing practice in the Calcutta High Court regarding filing appeals against consolidated orders.
3. The necessity of paying court fees for each assessment year in a consolidated appeal.
4. The distinction between the jurisdiction under sections 256 and 260A of the Income-tax Act.
5. The applicability of Civil Procedure Code provisions to appeals under section 260A.
6. The procedure for handling consolidated appeals and the payment of court fees.

Detailed Analysis:

1. Maintainability of One Appeal Under Section 260A:
The court examined whether a single appeal under section 260A can be maintained against a consolidated order disposing of multiple appeals by the Tribunal. It was argued that each appeal gives rise to a separate cause of action, even if the assessee is the same. Consequently, even if one appeal is permitted, the question arises whether one or more court fees are to be paid.

2. Prevailing Practice in Calcutta High Court:
Historically, the Calcutta High Court followed a practice where only one application for reference was filed against a consolidated order of the Tribunal, as directed on February 3, 1992. This practice continued even after the introduction of section 260A, with both the assessee and the Department filing one appeal against a consolidated order covering multiple assessment years.

3. Necessity of Paying Court Fees:
The court emphasized that even if one appeal is preferred against a consolidated order, it represents multiple causes of action. Therefore, court fees must be paid for each cause of action. The court referred to sections 10 and 17 of the Court Fees Act, which mandate the payment of sufficient court fees before proceeding to deliver judgment.

4. Jurisdiction Under Sections 256 and 260A:
The court differentiated between the advisory jurisdiction under section 256 and the appellate jurisdiction under section 260A. Under section 256, the High Court provides an opinion on a question of law, which does not dispose of the appeal before the Tribunal. In contrast, under section 260A, the High Court exercises appellate jurisdiction and decides the case involved in the appeal.

5. Applicability of Civil Procedure Code Provisions:
The court noted that section 260A(7) of the Income-tax Act incorporates the provisions of the Civil Procedure Code (CPC) relating to appeals to the High Court. This means that even if a consolidated order is passed, each assessment year and each assessee's cause of action must be treated separately, requiring the payment of court fees for each.

6. Procedure for Handling Consolidated Appeals:
The court concluded that one consolidated appeal can be permitted against a consolidated order for convenience. However, this consolidated appeal must represent the causes of action for each assessment year and each assessee separately. Consequently, court fees must be paid for each cause of action. The court also provided for extending the time to make good the deficit court fees under section 149 of the CPC.

Conclusion:
The court held that against a consolidated order involving multiple assessment years or assessees, one appeal can be filed, but court fees must be paid for each cause of action. This order applies prospectively and to pending cases, not to any appeal disposed of before this date. The Registrar was directed to notify relevant authorities and propose amendments to the Original Side Rules relating to references and appeals under the Income-tax Act, 1961.

Order:
The court directed that court fees be paid for each appeal under section 260A against each assessment year and each assessee. Deficit court fees must be paid within six months or at the time of disposal of the appeal, as directed by the court. This order is prospective and applies to pending cases. The Registrar was instructed to notify the necessary parties and propose amendments to the rules.