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TMI Blog1979 (1) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... r has filed under O. 47, r. 1 and s. 151, C.P.C., read with s. 260 of the I.T. Act, 1961, would lie. The learned counsel for the revenue opposing the application would urge that no such application would lie. He points out that under s. 256(1) of the I.T. Act, 1961, the assessee or the Commissioner may require the Tribunal, by an application in the prescribed form, to refer to the High Court any question of law arising out of such order of the Tribunal under s. 254. If the Tribunal is satisfied that a question of law arises, it may draw up a statement of the case and refer it to the High Court. If the Tribunal refuses to state the case on the ground that no question of law arises, the assessee or the Commissioner, as the case may be, within the time stipulated in the provision may apply to the High Court, and the High Court may, if it is not satisfied with the correctness of the decision of the Tribunal, require the Tribunal to state the case and to refer it and on receipt of such requisition, the Tribunal shall state the case and refer it accordingly. After the High Court takes a decision on the question, a copy of the judgment in the matter will have to be sent under the seal o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ? (b) Is the Tehri Darbar entitled to a refund of the amount already paid, i.e., Rs. 25,000 ? " The High Court (the same judges who heard the previous case heard the second reference also) answered the first question in the affirmative and held that the State was not liable to pay the balance of Rs. 18, 294-14-0 and that it was entitled to a refund of Rs. 25,000 already paid. The Commissioner appealed to the Privy Council. The Privy Council accepting the contention of the Commissioner said that though they might be prepared to endorse the view taken by the Allahabad High Court as to the true meaning of s. 3 of the Act of 1922, the former judgment of November 21, 1929, rendered by the High Court had not been appealed against and whether right or wrong must govern the relations of the parties in the particular case. The Privy Council further observed : " It is to be noticed that under section 66(5) of the Act of 1922, the judgment of the High Court is to contain the grounds upon which the decision is founded : that a copy of the judgment is to be sent to the Commissioner, and that the case is to be disposed of by the income-tax authorities ' comformably to such judgment '. Und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anation to section 271(1)(c) was introduced subsequent to that assessment year, the Explanation was not applicable as it had no retrospective effect. At the instance of the revenue the Tribunal referred to the High Court the question whether the Tribunal was correct in law in holding that the Explanation to section 271(1)(c) was not applicable to the case. In answering the reference, the court observed : ' the income returned was, therefore, less than 80 per cent. of the total income assessed. The Explanation to section 271 (1)(c) was thus directly attracted... The act of furnishing inaccurate particulars had taken place after the amendments were introduced in the section. Imposition of penalty by the Inspecting Assistant Commissioner was, therefore, justified ......... The year of assessment has nothing to do with the question of liability arising under section 271(1)(c) of the Income-tax Act, 1961. And to apply the section as amended to an act committed after the amendment is not to give the section retrospective effect. The only question is whether the elements of the section had been satisfied when the act was committed '. The petitioner applied to the court under section 256 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... long as we follow the system of jurisprudence we have been following the law will continue to make that power available. Errors can creep in and there can be omissions, and if there are accidental errors or omissions, we conceive that we have the jurisdiction to correct those errors and rectify those omissions. The principle is that no act of a court shall ever injure a party. We have been referred by counsel for the department to three decisions, the earliest of which is in CIT v. Tehri-Garhwal State [1934] 2 ITR 1 (PC). A passage from page 8 had been quoted for the proposition that if this court had construed a statute in a particular manner in answering a question referred to it by the Income-tax Appellate Tribunal, that construction cannot be replaced by another even if the court is satisfied that the earlier construction laid on it is erroneous. What the court in that case was ordered to do was to reverse the decision taken by the court for which of course this court has no jurisdiction. That is not the matter before us and we do not think that the decision has any application. Similarly, the decision in Seth Mathuradas v. CIT [1940] 8 ITR 412 (Nag) lays down the same propos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... directs that an appeal shall lie to a court already established, then that appeal must be regulated by the practice and procedure of that court. The learned judge had referred to the observations in National Telephone Co. Ltd. v. Postmaster-General [1913] AC 546 (HL) made by Lord Chancellor Viscount Haldane where it was said that when a question is stated to be referred to an established court without more, it imports that the ordinary incidents of the procedure of that court are to attach, and also that any general right of appeal from its decision likewise attaches. The same principle had been expressed by the Privy Council in Adaikappa Chettiar v. Chandrasekhara Thevar, AIR 1948 PC 12. That decision stated that where a legal right is in dispute and the ordinary courts of the country are seized of such dispute the courts are governed by the ordinary rules of procedure applicable thereto and an appeal would lie if authorised by such rules notwithstanding that the legal right claimed arises under a special statute which does not in terms confer a right of appeal. The learned judge had also referred to the decision in Secretary of State for India v. Chellikani Rama Rao [1916] ILR 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the High Court because it is a court and is unrelated to and independent of the nature of its jurisdiction, in regard to the power of review, unless it is expressly conferred, that cannot be so exercised. The power of review is not conferred on the High Court in the matter of a reference under the I.T. Act. In the absence of specific conferment of power it is too much to say that the High Court could exercise that power. Exercising of the review power cannot be in the exercise of an inherent power as Chief Justice Govindan Nair so clearly pointed out in K. Ahamad v. CIT [1974] 96 ITR 29 (Ker) [FB]. The High Court exercising inherent power in a reference under the Indian I.T. Act, 1922, acts there independent of the powers conferred under the Civil Procedure Code. We are in agreement with the view expressed by the Nagpur High Court as early as in 1940 in Seth Mathuradas v. CIT [1940] 8 ITR 412, that the court when acting under the powers conferred by s. 66 of the Indian I.T. Act, 1922 (corresponding to present s. 256 of the Act, 1961), was exercising a special jurisdiction and that its proceedings were not governed by the Code of Civil Procedure. In the present application for revi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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