TMI Blog2004 (6) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... is no inherent power in this court to grant interim orders while exercising revisional power under section 23 or appellate power under section 24 of the Act. Reliance was placed on the decision in M.E.C. Wires v. State of Karnataka [1999] 113 STC 391 (Karn), in support of the said contention. The division Bench which heard the application was of the view that the decision in M.E.C. Wires [1999] 113 STC 391 (Karn), required reconsideration for the following reasons: (a) When the High Court entertains a revision petition, being satisfied prima facie that the order of the Tribunal suffers from errors which give raise to substantial questions of law, denial of interim stay on the ground that there is no express provision would result in serious and irreparable injury. This is more so because if ultimately it is found that the assessee is not liable, he will not even be entitled to interest on the tax paid, having regard to the proviso to sub-section (6) of section 23. (b) The revisional power conferred on the High Court empowers the court to reverse, affirm or amend the order against which the revision petition is filed (or to remit the matter to the Appellate Tribunal) and pass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate orders. It is submitted that if the legislative intent was to bar grant of stay by High Court, a similar provision would have been made in section 23. On the other hand, learned Government Advocate submitted, on behalf of the Revenue, that the inherent power of the court cannot enlarge or expand the power or jurisdiction expressly conferred upon the court nor can the inherent power be exercised so as to violate any express provision of law. He submitted "that the assumption of an inherent power to grant stay would militate against the express provisions of sub-section (6), which requires the assessee to pay the tax in regard to the assessment notwithstanding the fact that he has filed a revision petition. He submitted that if the legislative intent was to confer the power of stay, it would have made a specific provision for grant of interim stay as has been done in the provisos to sections 20(3)(b) and 22(5). The learned Government Advocate submitted that absence of a specific conferment of power to issue interim stay shows a legislative intent that there should be no stay in proceedings under section 23 or 24 of the Act. Statutory provisions: Sub-section (1) of se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicable to such appeals, the provisions of sub-section (6) of section 23, as they apply in relation to the revision petitions under section 23(1) of the Act. Section 13 relates to payment and recovery of tax. Sub-section (3) thereof provides that any tax assessed or any other amount due under the Act from a dealer or any other person, may, without prejudice to any other mode of collection, be recovered as arrears of land revenue or by attachment/sale or as arrears of excise revenue (in the case of dealers in liquor) or as fine imposed by a Magistrate. The proviso to sub-section (3) of section 13 clearly contemplates grant of interim orders in exercise of revisional jurisdiction and it is extracted below: "Provided that where a dealer or other person who has appealed or applied for revision of any order made under this Act and has complied with an order made by the appellate or the revising authority in regard to the payment of the tax or other amount, no proceedings for recovery under this sub-section shall be taken or continued until the disposal of such appeal or application for revision." Analysis: The statute does not contain any express bar prohibiting the grant of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been expressly provided in the code or against the intention of the Legislature. In Arjun Singh AIR 1964 SC 993, the Supreme Court held as under: ". . . It is common ground that the inherent power of the court cannot override the express provisions of the law. In other words, if there are specific provisions of the Code dealing with a particular topic and they expressly or by necessary implication exhaust the scope of the powers of the court or the jurisdiction that may be exercised in relation to a matter the inherent power of the court cannot be invoked in order to cut across the powers conferred by the Code. The prohibition contained in the Code need not be express but may be implied or be implicit from the very nature of the provisions that it makes for covering the contingencies to which it relates . . . " In Ram Chand AIR 1966 SC 1899, the Supreme Court held thus: ". . . The inherent power of a court is in addition to and complementary to the powers expressly conferred under the Code. But, the power will not be exercised if its exercise is inconsistent with, or comes into conflict with, any of the powers expressly or by necessary implication conferred by the other provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The right of appeal is a substantive right and the questions of fact and law are at large and are open to review by the Appellate Tribunal. Indeed, the Tribunal has been given very wide powers under section 254(1), for it may pass such orders as it thinks fit after giving full hearing to both the parties to the appeal. If the Income-tax Officer and the Appellate Assistant Commissioner have made assessments or imposed penalties raising very large demands and if the Appellate Tribunal is entirely helpless in the matter of stay of recovery, the entire purpose of the appeal can be defeated if ultimately the orders of the departmental authorities are set aside . . . It is a firmly established rule that an express grant of statutory power carries with it, by necessary implication the authority to use all reasonable means to make such grant effective. . . The powers which have been conferred by section 254 on the Appellate Tribunal with widest possible amplitude must carry with them by necessary implication all powers and duties incidental and necessary to make the exercise of those powers fully effective . . ." (emphasis(1) supplied) In Commissioner of Income-tax, Delhi v. Bansi Dhar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder the scheme, the appeal is kept pending before the Tribunal and the appellate jurisdiction is retained by the Tribunal, but the High Court exercises an advisory or consultative jurisdiction . . . . . . The jurisdiction exercised by the High Courts is purely advisory, it is not that of a Civil Court exercising original, or any appellate or revisional, jurisdiction. Therefore, the powers and jurisdiction of the High Courts and in certain cases of the Supreme Court, are those which are expressed and conferred upon them and also those which inhere in the exercise of that jurisdiction or are ancillary or those which subserve the exercise of that function and jurisdiction of giving advice. The Special Jurisdiction of the High Court under section 256 (of Income-tax Act, 1961) does not deprive it of judicial character or its inherent power, it was submitted. This, in our opinion, does not solve the question because the High Court in answering a reference indubitably acts in a judicial capacity and must be implied to have powers which are necessary to discharge the obligations in exercising (1)Here italicised. its jurisdiction of giving advice conferred by the special provisions o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... comes akin to that of a second appeal under section 100, C.P.C. While there is no doubt that the power of revision or appeal, only with reference to a "question of law" is narrower than the power of appeal with reference to "questions of fact and law", for (1)Here italicised. the purpose of considering whether there is incidental power of stay, there is no difference between appellate and revisional power. In fact, sub-section (4) of section 23 enabling the High Court to reverse, affirm or amend the order of the Tribunal or remand the matter to the Tribunal or pass "such other order in relation to the matter as the High Court thinks fit" makes it clear that the revisional power is on par with appellate power, in so far as the incidental or ancillary powers are concerned. We will next consider whether sub-section (6) of section 23 acts as a bar on the power to grant stay. Sub-section (6) does not relate to the power of the High Court to pass interim orders during the pendency of revision. It does not bar or prohibit, granting of stay, pending disposal of the revision petition. It only requires the assessee to pay the tax in regard to the assessment made irrespective of the fact th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 13(3) shall be taken or continued until the disposal of such revision petition. Three provisions of the Act, viz., sections 21, 22-A and 23 relate to exercise of power of revision. Sections 21 and 22-A relate to exercise of suo motu revisional power, where the authority empowered is of the view that any order by an inferior authority, is prejudicial to the interests of the Revenue. The question of stay, obviously, does not arise in such circumstance. Therefore, when the proviso to section 13(3) refers to an interim order made in a revision regarding payment of tax or other amounts and further provides that no proceedings for recovery shall be taken or continued until disposal of the revision, it refers only to the exercise of power of revision under section 23. It follows that section 13(3) impliedly recognises the power of the High Court to grant stay or pass other interim orders in regard to the amount due, in proceeding under section 23. Thus, we are of the considered view that the inherent or incidental power of this court with reference to revisional jurisdiction under section 23 or appellate jurisdiction under section 24, will include the power to grant stay pending dispos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 45(7) by appealing to section 151 of the Code of Civil Procedure. It is impossible to hold that in a matter which is governed by the Act, an Act which enacts a statutory prohibition, there can be implied in the court outside the limits of the Act a general discretion to dispense with its provisions: see Maqbul Ahmed v. Onkar Pratap Narain Singh AIR 1935 PC 85. It is wellsettled that inherent jurisdiction or power is inherent in a court and section 151 of the Code of Civil Procedure does not confer such jurisdiction or power on the court but merely saves it because it already exists there. But inherent jurisdiction of a court can be invoked only when there are no specific provisions to meet the necessities of a case. Where there are specific provisions such as in this case the inherent jurisdiction cannot be invoked. To exercise the power of stay when there is a clear provision to the contrary in the Act is to fly in the face of the statute." In Champaklal Nanabhai v. Commissioner of Sales Tax, Maharashtra State [1993] 89 STC 37 (Bom), the Bombay High Court considered the provisions of section 61(6) of the Bombay Sales Tax Act, 1959 which provided that payment of the am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or employing such means as are essentially necessary to its execution and that the statutory power carries with it the duty in proper cases to make such orders for staying proceeding as will prevent the appeal if successful from being rendered nugatory.' Be it noted that the above proposition enunciated by the Supreme Court will hold good only where there is no express provision one way or the other. There is no room to apply the doctrine of incidental or implied powers when the Legislature makes a specific provision debarring the grant of stay or otherwise placing fetters on the appellate or revisional authority to grant stay. The power to decide the appeal or revision need not always be coupled with the power to pass interim orders to maintain status quo and the like." (emphasis(1) supplied) These decisions by the Delhi, Bombay and Andhra Pradesh High Courts make it clear that the power to grant stay has been recognised as incidental or ancillary to the power of revision or appeal. But, in view of the express bar contained in the relevant statute against grant of stay, it was held that the High Court could not grant stay. These decisions will not therefore be of any assistan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rly considered by the division Bench. With great respect to the learned Judges, we are unable to agree with the reasoning therein. In our view, the decision in M.E.C. Wires [1999] 113 STC 391 (Karn) is not good law in the light of the principles laid down in Mohammed Kunhi [1969] 71 ITR 815 (SC), reiterated in Bansi Dhar [1986] 157 ITR 665 (SC); AIR 1986 SC 421. The State expressed an apprehension that granting of stay will impede collection of tax. The answer is found in the case of Mohammed Kunhi [1969] 71 ITR 815, where the Supreme Court observed: "A certain apprehension may legitimately arise in the minds of the authorities administering the Act that, if the Appellate Tribunal proceeded to stay recovery of taxes or penalties payable by or imposed on the assessees as a matter of course, the Revenue will be put to great loss because of the inordinate delay in the disposal of appeals by the Appellate Tribunal. It is needless to point out that the power of stay by the Tribunal is not likely to be exercised in a routine way or as a matter of course in view of the special nature of taxation and revenue laws. It will only be when a strong prima facie case is made out that the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X
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