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Issues: (i) Whether references under section 256 of the Income-tax Act, 1961 and section 27 of the Wealth-tax Act, 1957 arising from specified districts had to be filed or referred to the Permanent Bench of the Patna High Court at Ranchi; (ii) Whether pending reference cases already filed at Patna were required to be transferred to Ranchi.
Issue (i): Whether references under section 256 of the Income-tax Act, 1961 and section 27 of the Wealth-tax Act, 1957 arising from specified districts had to be filed or referred to the Permanent Bench of the Patna High Court at Ranchi.
Analysis: The Court read section 256 of the Income-tax Act, 1961 with the scheme of the Act and the statutory arrangement creating the Ranchi Bench under section 2 of the High Court at Patna (Establishment of a Permanent Bench at Ranchi) Act, 1976. It held that, for reference jurisdiction, the controlling basis is the territorial area from which the assessment matter arises, and not the mere location of the Tribunal. The Permanent Bench at Ranchi was therefore the proper forum for reference matters arising from the specified districts, unless the Chief Justice directed otherwise.
Conclusion: In favour of the petitioner on this issue; the Income-tax Appellate Tribunal and the Commissioner were required to send future reference matters arising from the specified districts to the Ranchi Bench, subject to the Chief Justice's discretion to have a matter heard at Patna.
Issue (ii): Whether pending reference cases already filed at Patna were required to be transferred to Ranchi.
Analysis: The Court distinguished between the proper forum for future filing and the treatment of cases already pending. It declined to direct wholesale transfer of existing reference matters from Patna and left those pending cases to be disposed of by the Patna High Court.
Conclusion: Against the petitioner on this issue; the prayer for transfer of pending cases from Patna to Ranchi was refused.
Final Conclusion: The writ petition succeeded only to the extent of securing prospective filing and reference of covered matters to the Ranchi Bench, while the existing pending references at Patna remained there for disposal.
Ratio Decidendi: In the absence of an express contrary provision, reference jurisdiction under section 256 of the Income-tax Act, 1961 and similar reference jurisdiction under section 27 of the Wealth-tax Act follows the territorial forum created for the underlying assessment matters, and where a permanent bench has been statutorily constituted for specified districts, references arising from those districts must ordinarily go to that bench unless the Chief Justice orders otherwise.
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