1984 (10) TMI 2 - HC - Income Tax

Summary

Issues:
1. Negligence and default on the part of the Department in supplying annexures for references under section 256(1) of the Income-tax Act, 1961.
2. Whether incomplete references without annexures should be considered properly made references.
3. Consequences of default in supplying annexures by the applicant before the Tribunal.
4. Clarification on default responsibility when annexures are sent for verification and not attested by the Department.

Analysis:
The judgment delivered by DESAI J. and BHARUCHA J. addresses three references involving limited companies and a person from the Mafatlal family, highlighting a pattern of negligence and default by the Department in providing required annexures for the references under section 256(1) of the Income-tax Act, 1961. The Tribunal forwarded only the statement of case without annexures to the High Court, indicating the Department's failure to comply. The Court emphasizes that such incomplete references should not be considered properly made references and instructs the Tribunal to post the matter for directions and revoke the order of reference if the applicant fails to supply annexures after due notice. The Court sets a clear directive for handling incomplete references, emphasizing the importance of providing complete documentation.

Furthermore, the judgment clarifies that if annexures are sent for verification and not attested by the Department, the responsibility for default lies with the Department and not the applicant. The Court emphasizes that penalizing the applicant for the Department's default would be unjust. In all three matters under consideration, the Court observes gross default on the part of the Department from the outset. Consequently, the references are returned to the Tribunal with unanswered questions due to the applicant Commissioners' failure to prosecute the same. The Court instructs the office to implement the order by November 30, 1984, emphasizing the need for compliance with the directives provided in the judgment to rectify the default and negligence displayed by the Department in handling the references under the Income-tax Act, 1961.