BHARGAVA, J. - (1.) APPLICATIONS Nos. 233, 240 and 243 of 1953 purport to be applications under section 21 of the Excess Profits Tax Act. They relate to appellate orders passed by the Income-tax Appellate Tribunal in appeals arising out of proceedings for assessment of excess profits tax for the three chargeable accounting periods ending on December 31, 1940, December 31, 1941, and December 31, 1942, respectively. The other three connected APPLICATIONS Nos. 234, 241 and 242 of 1953 are applications under section 66 (2) of the Income-tax Act and they are directed against appellate orders of the Tribunal passed in proceedings arising out of assessment of the applicant for the assessment years 1941-42, 1942-43 and 1943-44, the relevant previous years being concurrent with the chargeable accounting periods mentioned above. After the decision of all the six appeal which came up before the Income-tax Appellate Tribunal applications were moved before the Tribunal under section 66 (1) of the Income-tax Act or section 21 of the Excess Profits Tax Act to refer certain question of law to this court. The Income-tax Appellate Tribunal in all six cases prepared statements of the cases and referred them to this High Court. In these statements of the cases only some of the questions, which according to the applicant arose out of the appellate order of the Tribunal, were referred to this court whereas some other questions were not referred. Thereupon, the applicant moved these applications praying to this court to ask for statements of the cases from the Income-tax Appellate Tribunal in respects of those question which were not included in the statements of the case already referred to this court by the Tribunal. When these applications came up for hearing a preliminary question arose whether these applications could appropriately be presented under section 66 (2) of the Income-tax Act or whether the appropriate provision of law under which such applications could be entertained by the court would be section 66 (4) of the Income-tax Act. We, consequently, heard learned counsel for the parties on this preliminary question. It may be mentioned that though the applicants had themselves moved these applications purporting to be under section 66 (2) of the Income-tax Act, Mr. R. S. Pathak, learned counsel appearing for them, urged before us that the applications could appropriately be moved under section 66 (4) of the Income-tax Act and prayed that these applications be treated as such.
(2.) THE preliminary question that thus falls for our decision is whether in cases where an assessee makes an application under section 66 (1) of the Income-tax Act to the Tribunal to refer more than one question of law arising out of the appellate order of the Tribunal and the Tribunal only draws up a statement of the case in respect of some of the questions of law and refers it to the High Court while refuses to frame other questions of law or to draw up a statement of the case in respect of them, the appropriate provisions of law under which the aggrieved assessee can move this court is section 66 (2) of the Income-tax Act or section 66 (4) of the Income-tax Act. It appears that for the purposes of deciding this question it is necessary to make a close scrutiny of the language of the various sub-sections of section 66 so as to be able to find out which of the two provisions of the law is more appropriately applicable. We may first take up the language of section 66 (1) of the Income-tax Act. Under that provision, the assessee or the Commissioner is permitted to make an application before the Appellate Tribunal to refer to the High Court "any question of law arising out of such order" and then there is direction in this provision that the Appellate Tribunal shall draw up a statement of the case and refer it to the High Court. It is to be noted that, before the duty which the Tribunal is required to carry out by the law is put down, the language used does not follow the language in which is to be mentioned the prayer of the assessee or the Commissioner. The prayer of the assessee or the Commissioner in the application has to be one requiring the Appellate Tribunal to refer any question of law arising out of the appellate order which expression will include one question of law arising out of that order. When the Tribunals duty is laid down the Tribunal is directed to draw up a statement of the case and refer it to the High Court. This direction to the Tribunal as contained in this language thus does not follow the requirements to be mentioned in the application made by the assessee or the Commissioner. In case it had been desired that the act to be done by the Tribunal in carrying out the direction was to comply with the requirements of the assessee or the Commissioner in the application, this direction should have been in the language that the Tribunal shall refer the question or questions of law arising out of the appellate order to the High Court. The Legislature, when it preferred to give the direction to the Tribunal to state the case and refer it to the High Court instead of directing the Tribunal to refer to the High Court a question or questions of law arising out of the appellate order, clearly did so with some purpose. The purpose was that the reference to the High Court was to be not confined to a question or questions of law only but was to comprise within it the whole case. The case, in these circumstances, would consist of all questions if law arising out of the appellate order of the Tribunal on the facts and circumstances found by the Tribunal and the Tribunal is required to draw up a statement of such a case. The statement drawn up by the Tribunal would, therefore, consist of (1) questions of law arising out of the appellate order of the Tribunal and (2) facts and circumstances relevant and necessary for the determination of those questions of law. This languages also indicates what is the scope of the word "case" as used in section 66 (1) of the Income-tax Act. The word "case", as we have just indicated, must be held to comprise within it all questions of law arising out of the appellate order on the facts and circumstances which have been found to exist. There being such a case in existence, and at the same time an assessee or a Commissioner having applied to the Tribunal to refer some questions of law to the High Court as arising out of the appellate order of the Tribunal, the Tribunal has to prepare a statement of that case. Consequently, when preparing the statement of the case, the Tribunal would to have to frame the actual questions and also to include within the statement of that case statements of relevant facts and circumstances. In some cases, the Tribunal may refuse to prepare a statement of the case altogether after holding that no question of law arises out of the appellate order of the Tribunal. In other cases, the Tribunal may frame all questions of law actually arising out of the appellate order and then there may be a third class of cases where the Tribunal may prepare a statement of the case in respect of some of the questions of law arising out of the appellate order while refusing to do so in respect of other questions of law which may actually arise out of the appellate order but which, in the opinion of the Tribunal, do not arise. Since these three contingencies can arise out of the action of the Tribunal under section 66 (1) of the Income-tax Act, we have to look to the other provisions of the Act to see what further proceedings have to be taken in each of those circumstances so as to provide adequate relief to the parties concerned. In the first instance, we may take the circumstances where the Tribunal has refused to frame any question of law at all on its opinion that no such question of law arises. The remedy for the aggrieved person in such a case is provided in section 66 (2) of the Income-tax Act which applies "whenever the Appellate Tribunal refuses to state the case on the ground that no question of law arises." Section 66 (2) of the Income-tax Act thus gives a full remedy to any aggrieved person if the refusal of the Tribunal to state a case is based on the ground that no question of law arises. This provision of law on its language thus applies to case where there is a total refusal by the Tribunal to state the case and refer it to the High Court as the Tribunal was directed to do under section 66 (1) of the Income-tax Act. For such cases, therefore, there is a clear remedy under section 66 (2) of the Income-tax Act, and, when that remedy is sought by an application before the High Court under that provision of law, the High Court has to satisfy itself about the correctness of the decision of the Tribunal refusing to state the case and if it is not satisfied about the correctness of the refusal the High Court can require the Tribunal to state the case and refer it to the High Court. It is again to be noted that even under section 66 (2) of the Income-tax Act, the direction to the Tribunal is to state the case and to refer it to the High Court so that what the Tribunal has to refer to the High Court is a case which it is required to state and not merely a question of law. Under this power, therefore, the High Court can grant adequate relief to a person aggrieved by a refusal of the Tribunal to state altogether a case and to refer it to the High Court when its powers are invoked under section 66 (1) of the Act.
(3.) IN the second case, where the statement of the case which is referred by the Tribunal to the High Court under section 66 (1) of the INcome-tax Act includes within it all the questions of law which the assessee desired the Tribunal to refer to the High Court, no question would arise of the assessee making a grievance against the order of the Tribunal except that in some cases it may be found that, though the statement of the case is complete as including all questions of law arising out of the appellate order of the Tribunal, it may still be defective to the extent that it may not contain complete statements of facts and circumstances relevant for the decision of those questions. IN such circumstances, the aggrieved party can invoke the powers of the High Court under section 66 (4) of the INcome-tax Act. Apart from the right of a party to invoke the powers of the High Court, the High Court also possesses power suo motu to have the defect rectified by calling upon the Tribunal to make additions to or alterations in the statements which may have been made by the Tribunal in the case when referring the case to the High Court. This remedy under section 66 (4) in respect of the defect in the statement of a case referred is available in both cases where the statement of the case is submitted to the High Court by the Tribunal under section 66 (1) of the INcome-tax Act or where the statement of the case is submitted under section 66 (2) of the INcome-tax Act. Any defective statement as to facts and circumstances in the statement of the case prepared by the Tribunal either under section 66 (1) or 66 (2) of the Act can thus be clearly rectified if the High Court exercises its power under section 66 (4) of the INcome-tax Act. There finally remains a case where the Tribunal may have prepared the statement of the case in respect of some questions of law arising out of the appellate order while refusing to state the case in respect of other questions which may actually arise out of the appellate order but which according to the Tribunal did not arise from it. It appears that, in such a case also, the appropriate provisions of law under which relief can be granted to the aggrieved party by the High Court is section 66 (4) of the Income-tax Act. We have already indicated earlier, that both under section 66 (1) and 66 (2) of the Income-tax Act the requirements laid down by the law are that the Tribunal is to draw up a statement of the case and refer it to the High Court or state the case and refer it to the High Court. The Tribunal is required to refer the case to the High Court and not merely a question or questions of law which, in the opinion of the Tribunal, arise out of the appellate order. The case that has to be referred both under section 66 (1) and 66 (2) must be comprised of all the questions which in fact do arise out of the appellate order and the facts and circumstances which are relevant and necessary for the determination of those questions. The statement of the case prepared by the Tribunal is, therefore, required to include all these ingredients of "case". The statement would be incomplete if it did not include all questions of law arising out of the appellate order as well as facts and circumstances relevant to those questions. Similarly, when stating the case under section 66 (2) of the Income-tax Act, the Tribunal must state all the questions of law arising out of the appellate order and all the facts and circumstances relevant to them. If, when a case is referred, there is anything incomplete in the statement drawn up by the Tribunal, it must be held that the Tribunal has not properly discharged its duty which it was called upon to do under section 66 (1) and section 66 (2) of the Income-tax Act. Thereupon, the provisions of section 66 (4) of the Income-tax Act become applicable. Under this provisions of law, there is before the High Court a case referred by the Tribunal to it under section 66 (1) or section 66 (2) of the Act. The case referred appears before the High Court in the form of the statement of the case. This statement of the case will consist of questions of law and statements of facts which will complete the full statement of the case. Under section 66 (4) of the Income-tax Act, the High Court has to be satisfied that these various statements which comprise the statement of the case are sufficient to enable it to determine the question raised by the case. In case the High Court is not satisfied that it is so, the court is empowered to refer the case back to the Tribunal to make such additions to or alterations therein as the court may direct in that behalf. The High Court is empowered to refer the case back to the Tribunal for making additions to or alterations in the statement of the case whenever the High Court is not satisfied that the questions raised by the case can be appropriately determined by the statements contained in the statement of the case. The questions raised by the case would consist of not only questions which have been actually framed by the Tribunal when drawing up the case but of the appellate order of the Tribunal. The point as to which questions of law actually arise out of the Tribunals appellate order would at the initial stage be decided by the Tribunal under section 66 (1) of the Income-tax Act. If the Tribunal holds that no question of law at all arises, the Tribunal may refuse to state the case altogether whereupon the correctness of the decision of the Tribunal on the point whether any question of law does or does not arise can be scrutinized by the High Court under section 66 (2) of the Income-tax Act. In other case, where the Tribunal forms a correct opinion as to some questions of law arising out of the appellate order and draws up a statement of the case in respect of them and refers it to the High Court, whereas it forms a wrong opinion about other questions of law and refuses to state the case in respect of those questions and to refer it to the High Court, the occasion for the High Court to consider the opinion of the Tribunal would arise when the statement in the case which has already been referred to the High Court comes up for scrutiny before the High Court under section 66 (4) of the Income-tax Act, when the High Court can either act suo motu or on the move of any of the parties aggrieved. The statements contained in the statement of the case would at that stage be open to examination by the High Court and these statements which would be scrutinised by the High Court would include questions of law already framed, questions of law not framed but which are raised by the case, and facts relevant and necessary for determining all such questions of law. In case the High Court finds that the statements contained in the statement of the case are defective in any respect, the High Court can for the removal of that defect refer the case back to the Tribunal under section 66 (4) of the Income-tax Act. It is significant to note that though at the earliest stage in sub-section (1) of section 66 the Legislature used the expression "question of law arising out of the appellate order" and permitted an aggrieved person to require the Tribunal to refer the question to the High Court, under subsequent provisions where the powers of the High Court are enumerated, the Legislature has always used the words "case and question of law raised by the case" instead of using the expression "question of law or questions of law." Thus under section 66 (4) of the Income-tax Act what the High Court is to satisfy itself about if whether the statements in the case referred to it already by the Tribunal are sufficient to enable it to determine the questions raised by the case and not merely the questions of law which the Tribunal may have actually referred to the High Court. Under section 66 (5) again, the High Court, upon hearing of such a case, is directed to decide the questions of law raised by the case and not merely questions of law which may have been referred by the Tribunal to it.;