2021 (5) TMI 192 - HC - Income Tax

Writ petitions challenging Settlement Commission's order dismissed for jurisdictional issues

The Court dismissed the writ petitions challenging the Settlement Commission's order under the Income Tax Act, citing jurisdictional issues. The Madras ... Settlement Commission under section 245D(4) - petitioner prayed for a direction to the first respondent Settlement Commission rehear the case for a fresh - HELD THAT:- The Honourable Supreme Court while passing its order in Commissioner of Customs and Central Excise versus Gao Ispat Ltd [2009 (7) TMI 1225 - SC ORDER] has not not considered any of the decisions rendered in the context of territorial jurisdiction of the High Courts under Article 226 of the Constitution of India. The Honourable Supreme Court in Kusum Ingot’s And Alloy versus Union of India [2004 (4) TMI 342 - SUPREME COURT] has observed that even though in a given case, where the original authority is constituted at one place and the appellate authority is constituted at another, a writ petition would be maintainable at both the places as order of the appellate authority constitutes a part of cause of actionnever the less ultimately held that even if a small part of cause of action arises within the territorial jurisdiction of the High Court, the same by itself may not be considered to be a determinative factor compelling the High Court to decide the matter on merits. In appropriate cases, the Court may refuse to exercise its discretionary jurisdiction by invoking the doctrine of forum conveniens . As the writ petitions have not been admitted, and since the contesting respondents have raised objection regarding the jurisdiction at the time of admission that the contesting respondents are located outside the jurisdiction of this court and within the jurisdiction of the courts in Karnataka, these writ petition are liable to be dismissed on the ground of forum conveniens. Issues:Challenge to impugned order of Settlement Commission under section 245D(4) of the Income Tax Act, 1961; Jurisdictional issue regarding maintainability of writ petition before the Madras High Court; Application of the doctrine of forum conveniens in determining jurisdiction.Analysis:The petitioner filed writ petitions challenging the order passed by the Settlement Commission under section 245D(4) of the Income Tax Act, 1961, seeking a rehearing of the case. The impugned order rejected the petitioner's application to settle the case for the assessment years 2008-09 to 2015-16. A preliminary objection was raised regarding the maintainability of the writ petition before the Madras High Court, as the contesting respondents were within the jurisdiction of the Karnataka High Court.During the hearings, reference was made to a Division Bench order in a similar case and a Supreme Court decision emphasizing the importance of filing petitions in the appropriate jurisdiction. The Supreme Court's position on territorial jurisdiction under Article 226 of the Constitution of India was highlighted. The Court also referred to a Supreme Court judgment regarding the doctrine of forum conveniens, stating that a small part of the cause of action within the territorial jurisdiction may not be determinative in compelling the High Court to decide the matter on merits.As the writ petitions were not admitted and the contesting respondents raised objections regarding jurisdiction, being located outside the Madras High Court's jurisdiction, the Court invoked the doctrine of forum conveniens. Consequently, the Court dismissed the writ petitions, granting the petitioner the liberty to seek remedy before the jurisdictional High Court in Karnataka in accordance with the law. No costs were awarded, and the connected writ miscellaneous petitions were closed.