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2024 (2) TMI 703 - HC - Income TaxOrders of assessment passed by HC not adhered / complied with - HC directing assessing authority as required to undertake the exercise of fact finding by determining the Fair Market Value of the Shares in question as required in the Explanation to Section 56 - Income from other sources - Determining the FMV of the shares in terms of Explanation to Section 56(2)(viib) - assessing authority imposed tax treating the said 'Share Premium' as “Income from Other Sources” - Tribunal held that the provisions of Section 56(2)(viib) cannot be invoked in the case of assessee company when cash or asset is transferred by a mother to her daughter - directions issued by this Court in [2019 (5) TMI 952 - MADRAS HIGH COURT], viz., that the assessing authority would undertake the exercise of fact finding by determining the fair market value of the shares in terms of Explanation to Section 56(2)(viib) was not adhered / complied with. HELD THAT:- To a pointed question as to whether the impugned order has been made in compliance with the directions of this Court, no response was forthcoming. It is thus evident that the direction of this Court has not been complied. Any order contrary / disregarding the direction of this Court cannot be sustained as it renders the order bad for want of jurisdiction, in this regard it may be relevant to refer to the decision of the Hon'ble Supreme Court in the case of East India Commercial Co. Ltd. v. Collector of Customs,[1962 (5) TMI 23 - SUPREME COURT] to hold that the law declared by the highest court in the State is binding on authorities or tribunals under its superintendence, and that they cannot ignore it either in initiating a proceeding or deciding on the rights involved in such a proceeding. If that be so, the notice issued by the authority signifying the launching of proceedings contrary to the law laid down by the High Court would be invalid and the proceedings themselves would be without jurisdiction. In view of the same, the impugned order is set aside and the writ petition stands disposed of. It is open to the assessing officer to complete the assessment orders in compliance with the directions issued by this court.
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