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TMI Blog2012 (8) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... eserve Bank of India (for short 'the RBI') in 1995. The RBI granted the permission in its letter dated 01.03.1995 subject to the conditions stipulated therein. The permission letter dated 01.03.1995 of the RBI stated that the liaison office of the petitioner was for the purpose of undertaking purely liaison activities viz. to inspect the quality, to ensure shipments and to act as a communication channel between head office and parties in India and except such liaison work, the liaison office will not undertake any other activity of a trading, commercial or industrial nature nor shall it enter into any business contracts in its own name without the prior permission of the RBI. The petitioner also obtained permission on 19.06.2000 from the RBI for opening an additional liaison office in Bangalore on the same terms and conditions as mentioned in the letter dated 01.03.1995 of the RBI. 3. On 10.12.2009, the petitioner filed an application before the Authority for Advance Rulings (for short 'the Authority') on the questions relating to its transactions in its liaison office in India set out in Annexure-II to the application. Questions No. 1 to 6 as set out in Annexure-II to the applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g and sale of the products imported by the applicant from India accrues to the applicant in India. (2) The applicant has a business connection in India being its liaison office located in India. (3) The activities of the Liaison Office in India are not confined to the purchase of goods in India for the purpose of export. (4) The income taxable in India will be only that part of the income that can be attributed to the operations carried out in India. This is a matter of computation. (5) The Indian Liaison Office involves a 'Permanent Establishment' for the applicant under Article 5.1 of the DTAA. (6) In terms of Article 7 of the DTAA only the income attributable to the Liaison Office of the applicant is taxable in India." Aggrieved, the petitioner has challenged the impugned order on various grounds mentioned in this special leave petition. 5. On 10.02.2012, we passed orders calling upon the learned counsel for the parties to first address us on the question of maintainability of special leave petitions filed either by the assessee or by the Department against the advance rulings of the Authority. Learned counsel for the parties referred to the provisions of Chapter XIX-B of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Constitution before the High Court or under Article 136 of the Constitution before this Court. Under Article 226 of the Constitution, the High Court can issue writs of Certiorari and Prohibition to control the proceedings of not only a subordinate court but also of any person, body or authority having the duty to act judicially, such as a tribunal. Under Article 227 of the Constitution, the High Court has superintendence over all courts and tribunals throughout the territory in relation to which it exercises jurisdiction. Under Article 136 of the Constitution, this Court may, in its discretion, grant special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any court or tribunal in the territory of India. Hence, we have to decide whether the Authority, if not a court, is a tribunal within the meaning of expression in Articles 136 and 227 of the Constitution and whether the Authority has a duty to act judicially and is amenable to writs of Certiorari and Prohibition under Article 226 of the Constitution. 7. The meaning of the expression "tribunal" in Article 136 and the expression "tribunals" in Article 227 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether the Authority pronounces upon the rights or liabilities arising out of the Act. Section 245N(a) of Chapter XIX B which defines "advance rulings" is extracted herein below: "245N. In this Chapter, unless the context otherwise requires,- (a) "advance ruling" means- (i) a determination by the Authority in relation to a transaction which has been undertaken or is proposed to be undertaken by a non-resident applicant; or (ii) a determination by the Authority in relation to the tax liability of a non-resident arising out of a transaction which has been undertaken or is proposed to be undertaken by a resident applicant with such non-resident, and such determination shall include the determination of any question of law or of fact specified in the application; (iii) a determination or decision by the Authority in respect of an issue relating to computation of total income which is pending before any income-tax authority or the Appellate Tribunal and such determination or decision shall include the determination or decision of any question of law or of fact relating to such computation of total income specified in the application: [Provided that where an advance ruling has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hairman and two Members) in Cyril Eugene Pereira, In re. [1999] 239 ITR 650] and at page 672 of the ITR, the Authority held: "Thus, sub-section (2) of section 245S has limited the binding nature of the ruling to the case of the applicant in respect of the transaction in relation to which the advance ruling is sought and to the Commissioner and authorities subordinate to him only in respect of the applicant and the transaction involved. This is not to say that a principle of law laid down in a case will not be followed in future. The Act has made the ruling binding in the case of one transaction only and the parties involved in that case in respect of that transaction. For other transactions and for other parties, the ruling will be of persuasive nature." The Authority, thus, held that the advance ruling of the Authority is binding in the case of one transaction only and the parties involved in respect of that transaction and for other parties, the ruling will be of persuasive nature. The Authority, however, has clarified that this is not to say that a principle of law laid down in a case will not be followed in future. This decision of the Authority in Cyril Eugene Pereira, In re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ution. We may cite some authorities in support of this view. In Kihoto Hollohan v. Zachillhu and Others (supra), the question raised before this Court was whether Paragraph 6(1) of Schedule-X of the Constitution providing that the decision of the Speaker or the Chairman on the question of disqualification of a member of the Legislature will be final would exclude judicial review under Articles 136, 226 and 227 of the Constitution and this Court held that the finality clause in Paragraph 6 of the Schedule-X of the Constitution does not completely exclude the jurisdiction of the Courts under Articles 136, 226 and 227 of the Constitution, though it may limit the scope of this jurisdiction. In Jyotendrasinhji v. S.I. Tripathi and Others (supra), this Court held that the provision in Section 245-I of the Income Tax Act, 1961, declaring that every order of settlement passed under sub-section (4) of Section 245D shall be conclusive as to the matters stated therein would not bar the jurisdiction of the High Court under Article 226 of the Constitution or of this Court under Article 136 of the Constitution. Considering the settled position of law that the powers of this Court under Article 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titution. Nonetheless, we do understand the apprehension of the Authority that a writ petition may remain pending in the High Court for years, first before a learned Single Judge and thereafter in Letters Patent Appeal before the Division Bench and as a result the object of Chapter XIX-B of the Act which is to enable an applicant to get an advance ruling in respect of a transaction expeditiously would be defeated. We are, thus, of the opinion that when an advance ruling of the Authority is challenged before the High Court under Articles 226 and/or 227 of the Constitution, the same should be heard directly by a Division Bench of the High Court and decided as expeditiously as possible. 13. The only other question which we have to consider is whether we should entertain this petition under Article 136 of the Constitution or ask the petitioner to approach the High Court under Articles 226 and/or 227 of the Constitution. Article 136 of the Constitution itself states that this Court may, "in its discretion", grant special leave to appeal from any order passed or made by any court or tribunal in the territory of India. The words "in its discretion" in Article 136 of the Constitution mak ..... X X X X Extracts X X X X X X X X Extracts X X X X
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