- Recently settling the case of Pr. Commissioner of Income Tax-I, Chandigarh v. M/s. ABC Papers Limited, the supreme court held that against orders of Income Tax Appellate Tribunal (ITAT) will lie only before the High Court within whose jurisdiction the assessing officer is situated.
- The Apex Court clarified that even if the case is transferred in exercise of power under Section 127 of the Income Tax Act, which enables a higher authority to transfer a 'case' from one Assessing Officer to another Assessing Officer, the High Court within whose jurisdiction the Assessing Officer has passed the order, shall continue to exercise the jurisdiction of appeal. The same principle would be applicable even if the transfer under Section 27.
- A bench headed by Justice U U Lalit reiterated that the jurisdiction of a highcourt is not dependent on the location of ITAT as sometimes a Bench of the ITAT exercises jurisdiction over the plurality of states.
- ITAT is a unified forum of bench administered by the president.
- The apex court's judgement came on appeals giving rise to an important question concerning appellate jurisdiction of the High Courts under Section 260A of the Income Tax Act, 1961 against judgments of Income Tax Appellate Tribunals.
- Jurisdiction exercised by ITAT do not follow article 1 of the Indian constitution which divide the states and union territories.
- Benches are sometimes constituted in a way that their jurisdiction encompasses territories of more than one state.
- These interpretations were a result of one of the crucial issues which included that some of the ITATs have jurisdiction of more than one state which means it can have jurisdiction for more than one High Court under section 260A of the Income Tax Act.
- the apex court noticed that section 260A does not clarify which High Court will entertain the appeal thus creating confusion. This issue needed to be settled.
- In the facts of the present case, both Punjab and Haryana High Court and the Delhi High Court had refused to entertain appeal on the ground of lack of territorial jurisdiction.
- The Court noted that while doing so, both the High Courts have relied on prior decisions of their own Courts which take diametrically contradictory views.
- The court finally observed that "While interpreting a judicial remedy, a Constitutional Court should not adopt an approach where the identity of the appellate forum would be contingent upon or vacillates subject to the exercise of some other power. Such an interpretation will clearly be against the interest of justice." (livelaw.in, n.d.)
- The judgments of the Delhi High Court in CIT v. Sahara India Financial Corporation Ltd and CIT v. Aar Bee Industries Ltd were overruled by the supreme court.
"Loved reading this piece by Krisha Mehta?
Join LAWyersClubIndia's network for daily News Updates, Judgment Summaries, Articles, Forum Threads, Online Law Courses, and MUCH MORE!!"
Join LAWyersClubIndia's network for daily News Updates, Judgment Summaries, Articles, Forum Threads, Online Law Courses, and MUCH MORE!!"
