Court refuses to address query without Tribunal order. Non-statutory circulars can't override Tribunal's referral right. The court declined to answer the referred question due to the absence of the Tribunal's order under section 254 of the Income-tax Act, emphasizing its ...
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Court refuses to address query without Tribunal order. Non-statutory circulars can't override Tribunal's referral right.
The court declined to answer the referred question due to the absence of the Tribunal's order under section 254 of the Income-tax Act, emphasizing its essential nature in resolving the issue. Additionally, the court dismissed the argument regarding the applicability of a Central Board of Direct Taxes (CBDT) circular, asserting that non-statutory circulars cannot override the Tribunal's statutory right to refer a case to the court under section 256(1) of the Act. The case was disposed of accordingly.
Issues Involved: 1. Absence of the Tribunal's order u/s 254. 2. Applicability of the Central Board of Direct Taxes (CBDT) circular regarding the referral of matters to the court.
Summary:
Issue 1: Absence of the Tribunal's Order u/s 254 The court addressed the preliminary objection raised by the assessee's counsel, Mr. Aggarwal, regarding the absence of the Tribunal's order u/s 254 of the Income-tax Act, 1961. The court upheld this objection, emphasizing that the Tribunal's order is a "basic document" essential for answering the referred question of law. The court cited several precedents, including CIT v. Bombay Master Printers Association [1984] 146 ITR 339 (Bom) and Mar Thoma Rubber Co Ltd. v. CIT [1992] 102 CTR 9 (Ker), to support the necessity of having all basic materials before it to effectively answer the question. The court concluded that without the Tribunal's order, it is not possible to answer the reference.
Issue 2: Applicability of CBDT Circular Mr. Aggarwal also contended that the matter should not have been referred to the court due to a CBDT circular, given the small amount of tax involved and the long pendency of the matter. However, the court found no merit in this argument. It clarified that the circulars which do not have statutory force are not enforceable, referencing CIT v. Imperial Surgical Co. Pvt. Ltd. [1991] 192 ITR 646 (SC) and Janta Metal Works v. ITO [1990] 186 ITR 458 (All). The court further stated that the statutory right of the Tribunal to refer a case to the court u/s 256(1) of the Act cannot be taken away by a circular. The court cited CIT v. Anjum M. H. Ghaswala [2001] 252 ITR 1 (SC) to reinforce that only circulars issued u/s 119 of the Act have statutory force.
Conclusion The court declined to answer the referred question due to the absence of the Tribunal's order, which is crucial for an effective resolution. The matter was disposed of accordingly.
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