TMI Blog1969 (10) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the total income of the assessee. The assessee preferred an appeal to the Appellate Assistant Commissioner but the appeal was unsuccessful. This was followed by a further appeal to the Income-tax Appellate Tribunal and in this appeal the assessee succeeded in getting the relief claimed by it. The Commissioner of Income-tax, who is the petitioner before us, thereupon prepared an application to be presented to the Income-tax Appellate Tribunal for referring certain questions of law arising out of the order of the Income-tax Appellate Tribunal and this application for reference was dispatched by him by registered post to the office of the Income-tax Appellate Tribunal at Bombay on 9th August, 1968. It was common ground between the parties that the return of income for the assessment year 1961-62, having been filed by the assessee before the commencement of the Income-tax Act, 1961 (hereinafter referred to as " the new Act "), the proceedings for assessment were governed by the Indian Income-tax Act, 1922 (hereinafter referred to as " the old Act "), and the application for reference made by the Commissioner was, therefore, governed by section 66, sub-section (1), of the old Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lief is well-founded. Section 66, sub-section (3), has, in our opinion, no application to the facts of the present case. Section 66, sub-section (1), allows a period of sixty days within which the assessee or the Commissioner may file an application for reference and this period of sixty days is to be calculated from the date on which the assessee or the Commissioner, as the case may be, is served with notice of the order of the Income-tax Appellate Tribunal. Section 66, sub-section (3), proceeds to state what remedy shall be available to the assessee or the Commissioner if the Income-tax Appellate Tribunal erroneously rejects the reference application as time-barred. That sub-section says : " 66. (3) If on any application being made under sub-section (1) the Appellate Tribunal rejects it on the ground that it is time-barred, the assessee or the Commissioner, as the case may be, may, within two months from the date on which he is served with notice of the rejection, apply to the High Court, and the High Court, if it is not satisfied of the correctness of the Appellate Tribunal's decision, may require the Appellate Tribunal to treat the application as made within the time allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... late Tribunal had the power, the Income-tax Appellate Tribunal would have certainly condoned the delay, but the Income-tax Appellate Tribunal felt unable to do so, as in its view there was no provision which conferred power on it to condone delay for sufficient cause. The question is whether this view taken by the Income-tax Appellate Tribunal is correct. Now it was not disputed on behalf of the Commissioner that unlike the proviso to section 256, sub-section (1), of the new Act, there was no provision in the old Act which empowered the Income-tax Appellate Tribunal to relieve the Commissioner against the period of limitation prescribed in section 66, sub-section (1), but the argument of the Commissioner was that by reason of section 29, sub-section (2), of the Limitation Act, 1963, section 5 of that Act was applicable and if the Commissioner satisfied the Income-tax Appellate Tribunal that he had sufficient cause for not preferring the application for reference within the prescribed period as he had done in the present case, the Income-tax Appellate Tribunal had power to condone delay and to admit the application for reference. This attempt on the part of the Commissioner to invok ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , appeal or application " without any words of limitation and, therefore, it might appear at first blush to be a plausible argument that any application, whether made to a court of law or to any other authority, would be within the language of the section. But a clear scrutiny of the scheme of the Limitation Act, 1963, shows that the sweep of section 29, sub-section (2), is not so broad and its ambit not so wide. If we turn to the third division in the Schedule to the Limitation Act, 1963, we find that all the articles in the third division to applications made to the courts were governed either by the Code of Civil Procedure or the Code of Criminal Procedure. Sections 4 and 5 also postulate that the applications to which these sections can apply must be applications to courts. It is indeed difficult to believe that the Legislature could have intended to make the provisions of sections 4 to 24 applicable to applications made to authorities other than courts. If the contention of the Commissioner were right, the result would be that sections 4 to 24 would be applicable even to applications made to executive authorities. That surely could not have been the intention of the legislatur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. The scope of the various articles in this division cannot be held to have been so enlarged as to include within them applications to bodies other than courts, such as a quasi-judicial tribunal, or even an executive authority. An industrial tribunal or a labour court dealing with applications or references under the Act are not courts and they are in no way governed either by the Code of Civil Procedure or the Code of Criminal Procedure. We cannot, therefore, accept the submission made that this article will apply even to applications made to an industrial tribunal or a labour court. The alterations made in the article and in the new Act, cannot, in our opinion, justify the interpretation that even applications presented to bodies, other than courts, are now to be governed for purposes of limitation by article 137... In the long title, thus, the words 'other proceedings' have been added ; but we do not think that this addition necessarily implies that the Limitation Act is intended to govern proceedings before any authority, whether executive or quasi-judicial, when, earlier, the old Act was intended to govern proceedings before civil courts only... The Bombay High Court also at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the Limitation Act, 1963, and particularly sections 4 and 5, the articles in the third division of the Schedule of the Limitation Act, 1963, deal only with applications to courts and applications to authorities other than courts are not within the contemplation of the Limitation Act, 1963. On this view of construction of section 29, sub-section (2), it becomes necessary to consider whether the Income-tax Appellate Tribunal could be said to be a court governed by the Code of Civil Procedure or the Code of Criminal Procedure. To this question the answer is obvious. Quite apart from the wider question whether the Income-tax Appellate Tribunal is a court, it is indisputable that in any event it could not be said to be a court governed by the Code of Civil Procedure or the Code of Criminal Procedure. Section 5A, sub-section (8), of the old Income-tax Act provided in so many terms that, subject to the provisions of that Act, the Appellate Tribunal shall have power to regulate its own procedure and the procedure of Benches of the Tribunal in all matters arising out of the discharge of its functions, and in exercise of the powers conferred by this sub-section, the Appellate Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n authority must of necessity have to decide controversies between its subjects, or between itself and its subjects, whether the rights relate to life, liberty, or property. The exercise of this power does not begin until some tribunal which has power to give a binding and authoritative decision (whether subject to appeal or not) is called upon to take action. " The courts are tribunals invested with the judicial power of the State and their authority is derived from the Constitution or some Act of the legislature constituting them. Their number, as pointed out by Hidayatullah J., as he then was, in Harinagar Sugar Mills v. Shyam Sunder Jhunjhunwala, is ordinarily fixed and they are ordinarily permanent, and can try any suit or cause within their jurisdiction. Their number may be increased or decreased, but they are almost always permanent and go under the compendious name of " courts of civil judicature ". This is of course a compendious name which includes riot only civil courts but also criminal courts. With the growth of civilisation and the problems of modern life, particularly the vast increase in Government activity in a welfare State, a large number of administrative tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " courts " is meant courts of law and by " tribunals ", those bodies of men who are appointed to decide controversies arising under certain special laws. Their procedures may differ but the functions are not essentially different. Both exercise the judicial power of the State and it is often difficult to distinguish between them. There is no single test that can be applied to determine whether a particular tribunal is a court or a mere judicial tribunal. Lord Stamp said that the real distinction is that courts have " an air of detachment ". But this is more a matter of age and tradition and is not of the essence. Many tribunals, in recent years, and particulary the Income-tax Appellate Tribunal have acquitted themselves so well and with such detachment as to make this test wholly insufficient. But broadly speaking it may be stated that a "court " in the strict sense is a tribunal constituted by the State as a part of the ordinary hierarchy of courts of law invested with the State's inherent judicial power. It is, to quote from the judgment of Hidayatullah J. in Harinagar Sugar Mills case " a part of the ordinary hierarchy of courts of civil judicature maintained by the State under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Supreme Court in Brajnandan Sinha v. Jyoti Narain. But even these requisites do not furnish an infallible test for determining whether the power exercised is a judicial power. Lord Simonds, delivering the opinion of the Judicial Committee of the Privy Council pointed out in Labour Relations Board of Saskatchewan v. John East Iron Works : "...there are many positive features which are essential to the existence of judicial power, yet by themselves are not conclusive of it.. . " And Lord Sankey L.C., speaking on behalf of the Judicial Committee in Shell Co. of Australia v. Federal Commissioner of Taxation, enumerated a number of negative propositions on the subject : (1) A Tribunal is not necessarily a court in this strict sense because it gives a final decision. (2) Nor because it hears witnesses on oath. (3) Nor because two or more contending parties appear before it between whom it has to decide. (4) Nor because it gives decisions which affect the rights of subjects. (5) Nor because there is an appeal to a court. (6) Nor because it is a body to which a matter is referred by another body. Now so far as the Income-tax Officer is concerned it can hardly be contended that he is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income-tax Act. It is not governed by the Code of Civil Procedure, but as set out in section 5A, sub-section (8), of the old Income-tax Act, it has power to regulate its own procedure, and in fact it has made the Appellate Tribunal Rules, 1946. Rule 32A of these Rules provides that the proceedings before the Income-tax Appellate Tribunal shall not be open to the public. Moreover, the Income-tax Appellate Tribunal is not fettered by technical rules of the law of evidence and is entitled to act on material which may not be accepted as evidence in a court of law. Section 37, sub-section (1), of the old Income-tax Act, no doubt, confers on the Income-tax Appellate Tribunal the same powers as are vested in the court under the Code of Civil Procedure, but as already pointed out above, those powers are limited only in respect of certain specified matters. This provision also shows that the Income-tax Appellate Tribunal is not a court in the strict sense of the term. It has merely some of the trappings of the court and the existence of these trappings of the court is not sufficient to convert it into a court. These circumstances leave no doubt that the Income-tax Appellate Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... understood and section 33, sub-section (3), enacted by the Central Legislature was, therefore, valid. The view taken in this decision was followed by a Division Bench of the Andhra Pradesh High Court consisting of Subba Rao C. J. and Jaganmohan Reddy J. : Satyanarayanamurthi v. Income-tax Appellate Tribunal. So also in Commissioner of Income-tax v. Walchand and Company, Shah J., speaking on behalf of the Supreme Court, accepted as an indisputable proposition that the Income-tax Appellate Tribunal is not a court. He said : " It is necessary to emphasise that, though the tribunal is not a court, it is invested with judicial power to be exercised in a manner similar to the exercise of power of an appellate court acting under the Code of Civil Procedure. " This statement of the law was reaffirmed by the Supreme Court in a subsequent decision in Income-tax Officer v. K. M. Mohammed Kunhi. It is well known that the Income-tax Appellate Tribunal is not a court but it exercises judicial powers. The Tribunal's powers in dealing with appeals are of the widest amplitude and have in some cases been held similar to and identical with the powers of an appellate court under the Code of Civ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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