Supreme Court

Pr. Commissioner Of Income Tax vs. ABC Papers Limited

MANU/SC/1016/2022

18.08.2022

Direct Taxation

High Court within whose jurisdiction the Assessing Officer has passed the order, shall continue to exercise the jurisdiction of appeal

Present appeals give rise to an important question concerning appellate jurisdiction of High Courts under Section 260A of the Income Tax Act, 1961 against judgments of Income Tax Appellate Tribunals. As Benches of the ITAT are constituted to exercise jurisdiction over more than one state, each state having a separate High Court, question arose as to which of the High Court is the appropriate Court for filing appeals under Section 260A of IT Act.

The legal structure under the IT Act commencing with Assessing Officer, the Commissioner of Appeals, ITAT and finally the High Court under Section 260A of IT Act must be seen as a lineal progression of judicial remedies. Culmination of all these proceedings in question of law jurisdiction of the High Court under Section 260A of the IT Act is of special significance as it depicts the overarching judicial superintendence of the High Court over Tribunals and other Authorities operating within its territorial jurisdiction.

The jurisdiction of a High Court stands on its own footing by virtue of Section 260A read with Section 269 of the IT Act. While interpreting a judicial remedy, a Constitutional Court should not adopt an approach where the identity of the appellate forum would be contingent upon or vacillates subject to the exercise of some other power. Such an interpretation will clearly be against the interest of justice. Under Section 127 of IT Act, the authorities have the power to transfer a case either upon the request of an assessee or for their own reasons. Though the decision under Section 127 is subject to judicial review or even an appellate scrutiny, this Court for larger reasons would avoid an interpretation that would render the appellate jurisdiction of a High Court dependent upon the executive power. As a matter of principle, transfer of a case from one judicial forum to another judicial forum, without the intervention of a Court of law is against the independence of judiciary.

Appeals against every decision of the ITAT shall lie only before the High Court within whose jurisdiction the Assessing Officer who passed the assessment order is situated. Even if the case or cases of an assessee are transferred in exercise of power under Section 127 of the IT Act, the High Court within whose jurisdiction the Assessing Officer has passed the order, shall continue to exercise the jurisdiction of appeal. This principle is applicable even if the transfer is under Section 127 of IT Act for the same assessment year(s). The order passed by the High Court refusing to exercise jurisdiction is set aside. Appeal allowed.

Tags : ITAT order High Court Jurisdiction

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