COMMISSIONER OF INCOME TAX Vs. VOORA SREERAMULU CHETTY NO 2

JUDGEMENT

(1.) THIS is an application for a certificate permitting an appeal to His Majesty in Council from an order of this court in an Income-tax matter. The respondent has taken the preliminary objection that this Court has no power to grant a certificate in this case.

(2.) THE respondent applied to the Commissioner of Income-tax to state a case on a question arising under Section 25(3) of the Income-tax Act. THE Commissioner, relying on the decision of this Court in N. A. S. V. Venkatachalam Chettiar v. THE Commissioner of Income-tax, Madras, refused to state a case on the ground that the order was not prejudicial within the meaning of Section 66(2) read with Section 33. In Venkatachalams Case an application was filed in the office of the Income-tax officer for a refund of income-tax under the provisions of Section 48 of the Act. THE application was rejected and the Commissioner refused to interfere by an order under Section 33. THE applicant then applied to the Court under Section 66(3). As the order of the Commissioner was not one enhancing the assessment and as it was considered that it was not "prejudicial" to the petitioner the Court held that the application by him to the Commissioner under Section 66(2) was incompetent. As some doubt was felt as to the correctness of this decision when the case out of which the present application arises came before the Court, a reference was made to a Full Bench of five Judges, and the answer given to the reference was that an order refusing to interfere with a prejudicial order was itself prejudicial. Consequently it was held that Venkatachalam Chettiar v. THE Commissioner of Income-tax, Madras, had been wrongly decided. On receipt of the answer given by the Full Bench to the question referred, the Bench dealing with the petition directed the Commissioner of Income-tax to state a case on the point of law involved. THE Commissioner of Income-tax desires to challenge the correctness of decision of the Full Bench in an appeal to his Majesty in Council.

(3.) GENTLE, J. - I agree and wish to add a few words. It is conceded that under Section 66-A(2) of the Income-tax Act there is no authority for this Court to grant a certificate in this matter permitting an appeal to His Majesty in Council, and the application is really based upon the provisions of Clause 40 of the Letters Patent. This clause does provide an appeal from a preliminary or interlocutory decision "as aforesaid". "As aforesaid", it is conceded by Mr. Patanjali Sastri refers to the proceedings contemplated by Clause 39 of the Letters Patent. In my opinion this matter is not a final judgment, decree or order within the contemplation of Clause 39. Since it has been held by their Lordships of the Judicial Committee in Tata and Iron Steel Co., Ltd. v. Chief Revenue Authority of Bombay that there is no appeal under Clause 39 of the Letters Patent from a decision of the High Court in an income-tax matter it must follow that there can be no appeal and no authority for this Court to grant a certificate permitting an appeal to His Majesty in Council under the provisions of Clause 40 of the Letters Patent. For these reasons I agree with the views expressed by my Lord the Chief Justice that this application should be dismissed.