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TMI Blog2017 (8) TMI 537X X X X Extracts X X X X X X X X Extracts X X X X ..... Sr. Adv. Mr. S. Udaya Kumar Sagar, Adv. Ms. Bina Madhavan, Adv. Ms. Akanksha Mehra, Adv. Mr. Mrityunjai Singh, Adv. Ms. Swati Bhardwaj, Adv. Mr. Piyush Dwivedi, Adv. Mr. Pareteek Dhir, Adv. Ms. Ramandeep Kaur, Adv. For M/s. Lawyer S Knit Co, AOR Mr. Mukesh Kumar Maroria, AOR And Ms. Anil Katiyar, AOR For the Respondent : Mr. G. Prakash, AOR Mr. Jishnu M.L. Adv. Ms. Priyanka Prakash, Adv. Ms. Beena Prakash, Adv. Ms. Anil Katiyar, AOR And Mr. Ramesh Babu M. R., AOR JUDGMENT A.K. SIKRI, J. By amendment in the Income Tax Act, 1961 (hereinafter referred to as the IT Act ) in the year 1998, Section 260A was inserted providing for statutory appeal against the orders passed by the Income Tax Appellate Tribunal. In this very Section, under sub-section (2)(b), court fees on such appeals was also prescribed which was fixed at ₹ 2,000/-. However, sub-section (2)(b) of Section 260A prescribing the aforesaid fee was omitted by amendment carried out in the said Act, with effect from June 01, 1999. It was presumably for the reason that insofar as court fee payable on such appeals are concerned, which are to be filed in the High Court, it is the State Legislature whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld be payable as per the unamended provisions. The High Court has not accepted this plea of the appellant and has held that any appeal filed on or after October 26, 2002 shall be governed by Section 52A of the 1959 Act. 4) The appeals are filed both by the writ petitioner, whose writ has been dismissed, as well as the Income Tax Department. The Commissioner of Income Tax (Appeals) has not accepted the decision of the High Court and the reason for that is obvious. Numerous appeals under Section 260A of the IT Act are filed by the Department as well and the Department also gets hit by the aforesaid Section 52A of the 1959 Act, as interpreted by the High Court. 5) Learned counsels appearing for the assessee as well as Income Tax Department submitted that the right of appeal is a matter of substantive right and not merely a matter of procedure. Therefore, this right becomes vested in a party when the proceedings are first initiated and before a decision is given, by the inferior court. Therefore, the relevant date for paying the court fee would be when the proceedings are initiated in the lowest court and not when the appeal is filed in the High Court. In support of this propos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence was also made to another judgment of this Court in State of Bombay v. Supreme General Films Exchange Ltd. (1960) 3 SCR 640) In that case the issue was whether in the absence of provision giving retrospective effect to certain amendments to court fee payable with effect from April 01, 1954, the court fee payable on appeal was payable according to the law in force at the time of the filing of the suit prior to this date or the law in force at the time of the filing of the appeal. This Court held that an impairment of the right of appeal by putting a new restriction thereon or imposing a more onerous condition is not a matter of procedure only; it impairs or imperils a substantive right and an enactment which does so is not retrospective unless it says so expressly or by necessary intendment. 7)When the proceedings originate in the form of a suit filed in the lowest court, it is easy to ascertain that date of filing which becomes governing date for the purpose of payment of court fee in respect of appeals, as vested right accrues on the date of filing of the initial court proceedings. How it is to be translated in tax matters? This was explained in Hardeodas Jagann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... force of Section 52A of the 1959 Act; and (ii) such a vested right stands impaired and/or made conditional retrospectively expressly or by necessary intendment . He, thus, submitted that it was imperative to have requisite foundational facts to demonstrate the aforesaid two conditions. According to him, however, the issue appears academic as no assessee has come forward as aggrieved by levy of court fee under Section 52A of the 1959 Act in a case in which appeal is filed where assessment is made and/or disputed demand in appeal is raised prior to October 26, 2002. Nor the details are available of the appeals filed by the Income Tax or Wealth Tax Departments where assessments are reversed in part of full and/or disputed demand is quashed by the Commissioner (Appeals) or Income Tax Appellate Tribunal prior to October 26, 2002, particularly number of such appeals pending before the High Court of Kerala, if at all. In any case, in the other appeals filed, if any, for the tax demands negatived by the appellate authorities prior to October 26, 2002, this issue of court fees does not appear to have been kept alive for grant of any effective relief. He cited few judgments in suppor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er October 01, 1998, vested right of appeal in the High Court had accrued. Same was the position qua Department in respect of those cases where the demand raised by the Department stood negatived by the appellate authority after October 01, 1998. 14) In the present case, as noted above, when Section 260A of the IT Act was introduced by way of amendment with effect from October 01, 1998, it contained provision in the form of clause (2) of sub-section (2) thereof relating to payment of court fee as well. As per that provision, fixed court fee of ₹ 2,000/- was provided. This provision was, however, omitted with effect from June 01, 1999. The court fee became payable as per Section 52 of the 1959 Act. The amendment in question in the 1959 Act, i.e. Section 52A, was made effective from March 06, 2003. This provision has not been made retrospective. 15) We, therefore, are not able to subscribe to the aforesaid view of the High Court and set aside the same. In fine, we hold as under: (i) Wherever assessee is in appeal in the High Court which is filed under Section 260A of the IT Act, if the date of assessment is prior to March 06, 2003, Section 52A of the 1959 Act shall ..... X X X X Extracts X X X X X X X X Extracts X X X X
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