1954 (1) TMI 1 - SC - Income Tax

Article 226 territorial scope affirmed; discretionary writ relief refused where statutory remedy under Section 8(5) was invoked and pending.

Article 226 territorial jurisdiction extends throughout a High Court's territorial limits and requires the person or authority to be amenable by residence ... Jurisdiction under Article 226 of the Constitution - Prerogative writs - Amenability to jurisdiction by residence or location - Discretionary nature of writ jurisdiction - Availability of alternative statutory remedy - Reference to High Court under Section 8(5) of the Investigation Commission Act, 1947 as alternative remedyJurisdiction under Article 226 of the Constitution - Amenability to jurisdiction by residence or location - Prerogative writs - Whether the Punjab High Court could be deprived of jurisdiction to issue writs in respect of proceedings before the Income tax Investigation Commission merely because the petitioners' original assessments related to another province and the Commission was located in Delhi. - HELD THAT: - The Court held that the earlier Privy Council decision in Ryots of Garabandho v. Zemindar of Parlakimedi (Parlakimedi) was not determinative of the scope of Article 226 under the Constitution. The Constitution conferred new and wider powers on all High Courts to issue prerogative writs, subject to two limits: the writs must run throughout the territories over which the High Court exercises jurisdiction, and the person or authority to whom the writ is directed must be within those territories and amenable to its jurisdiction by residence or location. The Parlakimedi observations were context specific to the pre Constitution charter limits and the particular substantive connection (settlement of rents in Ganjam) in that case; they do not support a rule that the mere fact that assessments were made elsewhere or that subsequent proceedings would be taken by Income tax authorities in another province automatically ousts the territorial jurisdiction of a High Court. On that basis the Court found the Punjab High Court's conclusion - that the mere location of the Commission in Delhi could not confer jurisdiction on it - unsustainable.The contention that the Punjab High Court lacked jurisdiction under Article 226 on the grounds relied upon by the High Court was rejected.Discretionary nature of writ jurisdiction - Availability of alternative statutory remedy - Reference to High Court under Section 8(5) of the Investigation Commission Act, 1947 as alternative remedy - Whether the Supreme Court should grant relief under Article 226 notwithstanding the existence of a statutory remedy under the Investigation Commission Act and the fact that a reference under that procedure was pending. - HELD THAT: - The Court declined to express a final view on whether Section 8(5) of the Investigation Commission Act excludes Article 226 altogether. It reiterated the settled principle that writ jurisdiction under Article 226 is discretionary, and a High Court may refuse to exercise it where an adequate alternative remedy exists. Here the appellants had availed themselves of the procedure in Section 8(5) and a reference to the High Court of Allahabad was pending. In these circumstances, and because the statutory scheme provided a remedy (including a reference to a Bench of not less than three Judges), the Supreme Court held it would not, in exercise of its supervisory jurisdiction, permit the appellants to invoke Article 226 at that stage. The Court also noted that any omission by the Income tax authorities to refer specific matters under the statutory procedure is itself remediable under the Act or, in case of gross miscarriage of justice, by special leave to this Court.Relief under Article 226 was refused on discretionary grounds because an adequate statutory remedy under the Investigation Commission Act had been invoked and was pending.Final Conclusion: Although the Court found the Punjab High Court's conclusion on territorial jurisdiction unsustainable and accepted that Article 226 jurisdiction could in principle extend where the authority is amenable to the Court's territorial jurisdiction, the appeals were dismissed because the appellants had an alternative statutory remedy under Section 8(5) of the Investigation Commission Act which they had invoked and which was pending; accordingly the Court declined to exercise writ jurisdiction and made no order as to costs. Issues: (i) Whether the Punjab High Court had jurisdiction under Article 226 of the Constitution to issue writs in respect of Investigation Commission proceedings located in Delhi and concerning assessees whose original assessments were in U.P.; (ii) Whether the remedy provided by Section 8(5) of the Taxation on Income (Investigation Commission) Act, 1947, excluded or precluded the exercise of the discretionary jurisdiction under Article 226 and whether relief should be refused because an alternative statutory remedy had been availed of.Issue (i): Whether the Punjab High Court could issue writs under Article 226 in respect of Investigation Commission proceedings located in Delhi affecting assessees assessed in U.P.Analysis: The Court examined the scope of Article 226 as conferring new and wide powers on all High Courts, subject to two limitations: the writs must operate throughout the territories in relation to which the High Court exercises jurisdiction, and the person or authority to whom the writ is directed must be within those territories and amenable to its jurisdiction by residence or location. The Privy Council decision in Parlakimedi was considered in context and distinguished on the basis that its reasoning arose from pre-Constitution limited prerogative-writ jurisdiction; subsequent constitutional provisions alter the territorial analysis. The Court held that jurisdiction must be determined by substance with reference to Article 226's territorial and amenability conditions rather than by rigid application of Parlakimedi.Conclusion: The Punjab High Court had jurisdiction under Article 226 to entertain writs in the present matter; the High Court's contrary conclusion based on Parlakimedi cannot be sustained. The conclusion is against the appellants on no substantive point of jurisdiction.Issue (ii): Whether Section 8(5) of the Taxation on Income (Investigation Commission) Act, 1947, provides the sole remedy excluding Article 226 relief, and whether the High Court should decline to exercise its discretionary jurisdiction because the appellants have availed the statutory remedy.Analysis: The Court observed that it was unnecessary to decide finally whether Section 8(5) wholly excludes Article 226; Article 226 is a discretionary remedy and a High Court may refuse to grant relief if an adequate alternative remedy exists. The factual position showed that the appellants had already invoked Section 8(5) and a reference under that provision to the High Court of Allahabad was pending. Given availability and invocation of the statutory remedy, and the discretionary nature of Article 226, it would be improper for the Court to exercise writ jurisdiction at this stage.Conclusion: The Court refused to exercise its discretionary jurisdiction under Article 226 because an adequate alternative remedy under Section 8(5) had been availed and was pending; this conclusion operates against the appellants and supports dismissal of their appeals.Final Conclusion: The appeals are dismissed; although the Punjab High Court's jurisdictional reasoning was set aside, the Court declined to grant discretionary relief under Article 226 in view of the alternative statutory remedy having been pursued, resulting in dismissal of the appeals without costs.Ratio Decidendi: A High Court's power under Article 226 extends throughout the territorial limits of its jurisdiction and requires the person or authority to be amenable by residence or location within those limits; however, Article 226 remains discretionary and may be refused where an adequate alternative statutory remedy exists and has been properly invoked.