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The judgment involves the interpretation of whether the action of the Income-tax Officer under section 197(3) of the Income-tax Act, 1961 is appealable under section 248 of the Act. Summary: The case concerns a limited company for the assessment year 1978-79, where the assessee declared a dividend of Rs. 64,80,000 and claimed relief under section 80J of Rs. 23,28,917. The Income-tax Officer issued a certificate under section 197(3) of the Act, determining that only 20% of the dividend represented profits exempt under section 80J, despite the assessee's application for 35.94%. The Commissioner of Income-tax (Appeals) rejected the appeal against this certificate, stating that no appeal was provided under section 246 or 248 of the Act. The Tribunal, however, held that the Income-tax Officer's order under section 197(3) was appealable, leading to a reference to the High Court. The High Court emphasized that the right of appeal is a statutory right, not inherent, and can only be exercised if provided by the statute. Section 246 of the Act does not allow for an appeal against an order under section 197(3), with the only relevant provision being section 248, which pertains to persons denying liability to deduct tax under sections 195 and 200. As section 197(3) only grants the right to make an application to the Income-tax Officer, without provision for appeal, the Tribunal erred in deeming the Income-tax Officer's action appealable under section 248. Consequently, the High Court ruled against the appeal and in favor of the Revenue. In conclusion, the High Court held that the Income-tax Officer's action under section 197(3) is not appealable under section 248 of the Income-tax Act. The question posed was answered in the negative, and no costs were awarded in this case.
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