MUHAMMAD MUNIR, J. - (1.) THIS order will extend to Civil Appeals Nos. 2-D, 3-D, 4-D, 5-D and 29 of 1957, which, the question of their competency having been reserved, were preferred by special leave of this Court. The appeals are by different assessees and arise out of separate orders of the High Court of Dacca declining to require the Tribunal to state a case under sub-s. (2) of S. 66 of the IT Act, 1922, and later dismissing their applications for a certificate for leave to appeal to this Court. There is only one point which has to be determined in these appeals, and that is whether an appeal to the Supreme Court lies from an order of the High Court under sub-s. (2) of S. 66 of the IT Act refusing an assessee's application to direct the Tribunal to state a case. Though the appellants, when the petitions for special leave to appeal were presented to this Court, were labouring under some confusion, it is now stated before us that the appeals are directed against the High Court's orders, all made before the Constitution came into force, refusing to direct the Tribunal to state a case under sub-s. (2) of S. 66 and that such an appeal, on the authority of the Lahore High Court's decision in Feroze Shah vs. CIT, (1931) ILR 12 Lah 166 (Punj) lies under cl. 29 of the Letters Patent as of right and without any certificate except as to the value of the matter in issue, as well as under S. 109 r/w S. 110 of the CPC. Having heard counsel at length we are of the view that such an appeal does not at all lie.
(2.) BEFORE the provision that now occurs as sub-s. (2) of S. 66-A of the IT Act Act appeared on the statute book there was no express reference in the IT Act to an appeal to His Majesty in Council, and it was held by the Privy Council in Tata Iron and Steel Co. Ltd. vs. Chief Revenue Authority of Bombay (1923) ILR 47 (Bom) 724, that the High Court in entertaining and giving opinion on a reference under the IT Act exercises a consultative jurisdiction and that the opinion given by it is not a final judgment, decree or order within the meaning of cl. 39 of the Letters Patent, from which an appeal would lie to His Majesty in Council. As on this interpretation of the Act the assessees as well as the Department were deprived of the benefit of the High Court's opinion on complicated questions of law in important cases under the IT Act, the Act was amended in 1925 by the insertion of S. 66-A, sub-s. (2) of which provided that an appeal shall lie to His Majesty in Council from any judgment of the High Court delivered on a reference made under S. 66 in any case which the High Court certifies to be a fit one for appeal to His Majesty in Council. It must follow from the aforesaid decision of the Privy Council that the present Supreme Court's jurisdiction to entertain a statutory appeal in matters arising under the IT Act is limited to the case mentioned in sub-s. (2) and that such jurisdiction can be invoked only where the High Court has delivered a judgment on a reference made to it under S. 66 and also certified the case to be a fit one for appeal to the Supreme Court. In the present cases, therefore, no judgment having been delivered by the High Court on any reference under S. 66, and the High Court not having certified the appeal to be a fit one for appeal to the Supreme Court, no appeal lies and the High Court, even if it had so wished, could not have given leave to appeal to this Court. Sub-s. (2) of S. 66-A has been interpreted by the Privy Council in Delhi Cloth & General Mills Co. Ltd. vs. CIT (1928) ILR 9 (Lah) 284, as excluding from any right of appeal cases which fall within the requirements of S. 110 of the CPC and as confining that right to cases which are certified to be otherwise fit for appeal to His Majesty in Council, even though the amount involved in them be Rs. 10,000 or upwards and the High Court in its opinion may have differed from the opinion of the Tribunal. It is obvious, therefore, that where the question is whether an appeal to the Supreme Court lies in an income-tax matter, the question has first to be decided not with reference to ss. 109 and 110 of the CPC, but solely on the terms of sub-s. (2) of S. 66-A of the Act, though once the case is held to fall within that sub- section, the provisions of the Code relating to appeals to the Supreme Court will apply to the appeal as if it were an appeal from a decree of a High Court. The correctness of the Lahore decision in Feroze Shah's case (supra) appears to have been doubted by the Privy Council itself in Feroze Shah's vs. CIT (1933) 1 ITR 219 (PC), though there was no pronouncement on the subject. It seems, however, to be clear to us that when a High Court rejects an assessee's application under sub-s. (2) of S. 66 and declines to call upon the Tribunal to state a case, it does not act in exercise of its original or appellate jurisdiction but only in exercise of a special statutory jurisdiction conferred on it by the IT Act, and that the Lahore High Court was plainly wrong in that case in assuming, without any discussion of the question, that the jurisdiction exercised by the High Court in such cases is original and in holding that for that reason an appeal lay as of right to His Majesty if the amount of the tax involved was or exceeded Rs. 10,000. As pointed out by the Dacca High Court in the present case, the Lahore case has not been followed anywhere in the Indo-Pakistan sub-continent and has been held by the Supreme Court of India in Seth Prem Chand Satram Das vs. State of Bihar (1951) 19 ITR 108 (SC), to have been wrongly decided. If the view taken in the Lahore case were held to be correct, it would lead to the apparent absurdity that, if the Tribunal refuses to state a case because no question of law in involved and the High Court agreeing with the Tribunal dismisses and application under sub-s. (2) of S. 66, an appeal would lie to the Supreme Court as of right if the value of the subject-matter is Rs. 10,000, or more, whereas in a case the Tribunal and the High Court both agree that the matter gives rise to a question of law, but the High Court, in the circumstances of the case, feels that the case is not a fit one for appeal to the Supreme Court, no appeal would lie to the Supreme Court. In our judgment no appeal lies in these cases either under cl. 39 of the Letters Patent or under S. 109 r/w s. 110 of the CPC. Clause 39 of these Letters and cl. (b) of S. 109 of the Code are not applicable because the High Court in refusing the application under sub-s. (2) of S. 66 did not act in the exercise of its original jurisdiction and cl. (a) of S. 109 of the Code does not apply because the High Court in refusing that application did not exercise any appellate jurisdiction. And S. 110 of the Code is not in point because that section refers back only to cases mentioned in cls. (a) and (b) of S. 109. As regards S. 109(c) an appeal would lie under that provision only if the High Court certified a case to be a fit one for appeal and that Court did not consider the present cases as satisfying that requirement.
(3.) THE appeals are therefore dismissed. In view of the fact that the appellants came to this Court on the authority of a reported decision we direct the parties to bear their own costs here.;