Inherent powers cannot be used to review an earlier tax reference judgment; recall application held not maintainable.

In a reference under Section 256 of the Income-tax Act, the High Court's jurisdiction is advisory and limited to the questions referred. It cannot use inherent powers under Section 151 of the Code of Civil Procedure to recall, delete, or modify observations in an earlier reference judgment where the relief would amount to review. The Court held that the proper remedy against such observations, if available, lay in appeal rather than recall under inherent jurisdiction. The application was therefore not maintainable and was refused.

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Issues: (i) Whether the High Court could recall or modify the earlier reference judgment under its inherent powers in a proceeding under the Income-tax Act, 1961.

Analysis: The application sought deletion of observations made in the earlier judgment. The Court held that in a reference under Section 256 of the Income-tax Act, 1961, its jurisdiction is advisory and confined to the questions referred. If the requested relief would amount to review of the earlier judgment, the High Court cannot exercise inherent power under Section 151 of the Code of Civil Procedure, 1908 to grant it. The Court also noted that the proper remedy against such observations, if any, lay in appeal and not in recall under inherent powers.

Conclusion: The application was not maintainable as it in substance sought review of the earlier order, and the Court refused to recall or modify the judgment.

Final Conclusion: The proceeding was rejected because inherent jurisdiction could not be used to review a reference decision.

Ratio Decidendi: In a reference proceeding, the High Court cannot invoke inherent powers under Section 151 of the Code of Civil Procedure, 1908 to do what would amount to a review of its earlier advisory judgment.

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