1978 (3) TMI 100 - HC - Income Tax

Jurisdiction Ruling: Delhi High Court lacked authority, case referred to Allahabad High Court. Parties to bear own costs.

Seth Banarsi Dass Gupta Versus Commissioner Of Income-Tax, Delhi (Central)

The court held that the Delhi High Court lacked jurisdiction to entertain the reference under section 66(1) of the Indian Income-tax Act, 1922, as the ... Assessing Officer, High Court Issues Involved:1. Jurisdiction of the High Court to entertain the reference under section 66(1) of the Indian Income-tax Act, 1922.2. Determination of the appropriate High Court for references when the Appellate Tribunal has jurisdiction over multiple states.Issue-wise Detailed Analysis:1. Jurisdiction of the High Court to entertain the reference under section 66(1) of the Indian Income-tax Act, 1922:The assessee, a Hindu undivided family, and the Commissioner of Income-tax filed applications under section 66(1) of the Act, leading to a reference of seven questions of law to the High Court. The primary objection raised was whether the Delhi High Court had jurisdiction to entertain the reference given that the assessee resided and conducted business in Meerut, Uttar Pradesh. The assessment orders were passed by the Income-tax Officer in Meerut, and the appeals were disposed of by the Appellate Assistant Commissioner in Meerut. Consequently, it was argued that the appropriate High Court should be the Allahabad High Court, not the Delhi High Court, despite the Appellate Tribunal, Delhi Bench, being situated in Delhi.The court examined relevant statutory provisions, including sections 5, 30, 33, 64, and 66 of the Act, and the Appellate Tribunal Rules, 1946 and 1963. It was noted that the jurisdiction of an Income-tax Officer to assess an assessee is based on the location of the business or residence of the assessee, as per section 64. However, the jurisdiction of the Appellate Tribunal is determined by the location of the office of the assessing officer, not the place of business or residence of the assessee.The court concluded that the jurisdiction of the High Court for references under section 66(1) should be determined by the location of the office of the assessing officer, aligning with the jurisdiction of the Appellate Tribunal Bench that heard the appeal. Therefore, the Delhi Bench had jurisdiction to hear and determine the appeals from Meerut, but the reference should have been made to the Allahabad High Court, not the Delhi High Court.2. Determination of the appropriate High Court for references when the Appellate Tribunal has jurisdiction over multiple states:The court considered the decision of the Madras High Court in Commissioner of Income-tax v. S. Sivaramakrishna Iyer, which suggested that the High Court's jurisdiction should be determined by the place where the assessee carries on business or resides. However, the court found this principle inapplicable for determining the High Court's jurisdiction for references under section 66(1).The court reasoned that the appropriate High Court should be determined based on the jurisdiction of the Appellate Tribunal Bench, which is guided by the location of the office of the assessing officer. This approach ensures consistency and aligns with the provisions of the Act and the Appellate Tribunal Rules.The court rejected the suggestion that the location of the Bench hearing the appeal should determine the High Court's jurisdiction, as this would result in a few High Courts having exclusive jurisdiction over all references, excluding other High Courts. Instead, the court emphasized that the High Court for references should be the one in the state where the assessing officer's office is located.Conclusion:The court concluded that the Delhi High Court did not have jurisdiction to entertain the reference, as the appropriate High Court was the Allahabad High Court. The reference was declined, and the statement of the case was returned to the Delhi Bench for appropriate action. The parties were directed to bear their own costs.