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TMI Blog1990 (1) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... .e. the order dated 13-71989 was served on the Chief Commissioner of Income-tax, Delhi on 28th of July, 1989 in accordance with the provisions of section 254(3) of the Income-tax Act as amended by the Direct Tax Laws Amendment Act, 1987 w.e.f. 1-4-1988. The present applications were presented in the Tribunal on 9-11-1989. There was thus a delay of 44 days. The Chief Commissioner of Income-tax appears to have sent a copy of the order to the Commissioner of Income-tax, Delhi-III on 12-9-1989. The Commissioner of Income-tax who is the applicant before us now claims that the period of limitation should start from the date on which the order of the Tribunal was served on him namely 12-9-1989 and reckoned from that date the applications filed were in time and were not barred by limitation. According to the report of the Registry, on the other hand the order of the Tribunal having been, served on the Chief Commissioner of Income-tax on 28th July, 1989, the limitation period should start from that date and so reckoned the applications were out of time. 3. A notice pointing out the above defect was served on the Commissioner and the Commissioner submitted a reply dated 26-12-1989. In this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned counsel for the assessee Sri C.S. Agarwal submitted that under section 254(3) of the Income-tax Act, a copy of the order passed by the Tribunal has to be sent either to the Chief Commissioner or to the Commissioner unlike the earlier provision of law which was in force till 31-3-1988 according to which the orders of the Tribunal have to be sent only to the C.I.T. By virtue of the Direct Tax Laws Amendment Act, 1987 the provisions of section 254(3) were amended w.e.f. 1-4-1988 to provide that the copy of the Tribunal's order should be sent to the Chief Commissioner or to the Commissioner. The Tribunal has the option either to send the copy of its order to the Chief Commissioner or to the Commissioner and if in exercise of that option, the order was served on the Chief Commissioner, the obligation on the part of the Tribunal to serve the orders stood discharged and, therefore, the date for counting the limitation should start from the date on which the order was served on the Chief Commissioner. The Department cannot now contend that the date of service by the thief Commissioner or the Commissioner alone should be taken into consideration in as much as that was not contemplated u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the Chief C.I.T. A similar difficulty arose before the Law was amended w.e.f. 1-4-1988 and the matter reached the Bombay High Court by way Writ Petition. The Board considered the matter in all its aspects and after taking the advice of the Law Ministry, came to the view that since the Income-tax Appellate Tribunal was not in a position to know nor has the necessary machinery to ascertain as to the changes made in the jurisdiction of the Commissioner of Income-tax and since the Income-tax Act provided service of the orders of the Tribunal on the Commissioner, that service on one Commissioner whether he held jurisdiction or not of the concerned case, should be regarded as the proper service and enjoined a duty upon that C.I.T. to take steps forthwith to remit the order to the concerned C.I.T. so as to enable him to file the reference application within the prescribed time. It was also clearly pointed out in this instruction that the change in the address must be informed to the Registry of the Tribunal as expeditiously as possible but the responsibility has been placed upon the transferring Commissioner to forward the applications to the concerned Commissioner and the date of limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of the Tribunal's order by the Chief Commissioner. It could not be said of no consequence. The Legislature must be conscious of the provisions of section 256(1) when it amended the provisions of section 254(3) by providing that a copy of the order of the Tribunal may be sent to the Chief Commissioner as an alternative to the Commissioner. The amendment in sub-section (3) could not have been intended to grant the revenue an undesired privilege of extending the period of limitation prescribed under section 256(1) indefinitely. If that was so, the instruction given by the Board referred to above would have no meaning at all. If the contention of the Commissioner of Income-tax was accepted then the Chief Commissioner may keep the order with him indefinitely for any length of time thereby extending the period of limitation beyond 60 days. As is evident from the facts of the present case, the Chief Commissioner took a long time in sending the copy of the order to the concerned Commissioner although both of them were located in the same town. The anxiety of the Legislaure to give a quick disposal to the reference applications is writ large even in section 256(1), as sub-section (1) requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cess of Law, a meeting was arranged between the President and the Chief C.I.T. to sort out this problem and in that meeting, an understanding was evolved that the Chief C.I.T. Delhi would act as the agent of the Tribunal and orders should be served on him with a slip attached and that he would make arrangements to serve the orders on the concerned C.I.T. along with the slips and that the slips would be sent to the Tribunal as soon as they were served on the concerned Commissioner and it was in that context that it was agreed that the date of service on the concerned Commissioner by the Chief Commissioner would be regarded as the date of service for counting limitation u/s 256(1). Such a practice was arrived at some time in the year 1986 or 1987 but long before 1-4-1988. That the amendment brought to section 254(3) w.e.f. 1-4-1988 permitting the Tribunal to serve orders on the Chief Commissioner also, the understanding automatically lapsed and the Chief Commissioner was receiving orders w.e.f. 1-4-1988 not in terms of the understanding but in compliance with the specific provisions of section 254(3). The understanding would not, therefore, hold any more good and valid and would be c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e gave the receipt of the notice of the order, perhaps by mistake as 7-7-1977 though the said mistake was pointed out to the Tribunal by filing a misc. petition and by explaining that the order of the Tribunal was received by the CIT, Pune on 1-9-1977. The Tribunal dismissed the misc. application as well as the reference application as time barred. The Tribunal pointed out that even though in column 10 of the form of appeal, the ITO stated the address to which the notices must be sent to him, he did not convey to the Registry the change in the address. The Board then filed a writ petition against the Tribunal's order before the Bombay High Court. Dismissing the writ petition, the Bombay High Court made the following observation : " The order of the Tribunal shows that the representative of the Commissioner was not in a position to clarify in spite of the query from the Tribunal and to the date of the order in which the jurisdiction was transferred from ITO Bombay to ITO Thane, the jurisdiction could as well have been transferred on any date before 23-8-1977. It is not clear why the copy received by the Commissioner, Bombay on 7-7-1977 was not returned forthwith to the Tribunal an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. The Board then pointed out that in case it is not possible to do so, a request should be made to the Appellate Tribunal to allow the application to be presented within a further period of 30 days. Then the Board pointed out that in case where the transfer of jurisdiction took place after the Tribunal had passed the order u/s 254(1), the service of the Tribunal's order on the transferring Commissioner would be valid notwithstanding the transfer of the case records to another Commissioner's charge before the date of such service. It again placed the responsibility upon the transferring Commissioner to immediately forward the Tribunal's order to the concerned Commissioner for necessary action by pointing out that the limitation would run from the date of the service of the order on the transferring Commissioner. A role has also been assigned to the Departmental Representative to ascertain the change in the jurisdiction and inform the Tribunal on a prescribed proforma for that purpose for use by the D.Rs. 9. When such were the clear instructions of the Board which shows the anxiety of the Board to conform to the limitations prescribed under the Income-tax Act and when this instruc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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