K.S. RASHID AND SON vs. THE INCOME TAX INVESTIGATION COMMISSION, ETC.

CIVIL APPEAL No. 118/1952Supreme Court[1954] 1 S.C.R. 73822 January 1954Bench: 5 JudgesAuthor: MEHR CHAND MAHAJAN, BIJAN KUMAR MUKHERJEA, SUDHI RANJAN DAS, VIVIAN BOSE, GHULAM HASAN K. S. RASHID AND SON10 pages
AI SummaryDismissed

What were the facts?

The appellants, K. S. Rashid & Son, a partnership firm and its individual partners, were referred to the Income-tax Investigation Commission in 1947 due to alleged substantial income-tax evasion. The authorized official began investigations, extending them beyond March 31, 1943, despite the appellants' objections. The appellants filed petitions before the Punjab High Court seeking writs of prohibition and certiorari, or revision under Article 227, to halt the investigation. The High Court dismissed these petitions on preliminary grounds, leading to the present appeals before the Supreme Court. The appellants' core grievance was that the investigation was being conducted contrary to the provisions of the Taxation on Income (Investigation Commission) Act, 1947, and that the High Court lacked jurisdiction to entertain their petitions.

What did the Supreme Court hold?

The Supreme Court held that the Punjab High Court does have jurisdiction to issue writs under Article 226 to the Income-tax Investigation Commission located in Delhi. The Court clarified that Article 226 confers wide powers, limited only by the territory over which the High Court exercises jurisdiction and the requirement that the person or authority must be amenable to its jurisdiction by residence or location within those territories. The Court found the High Court's reasoning on this point to be unsustainable. However, regarding the second issue, the Court found it unnecessary to definitively rule on whether Section 8(5) of the Act provided an exclusive remedy. Instead, the Court noted that the appellants had already availed themselves of the remedy under Section 8(5) by filing a reference to the Allahabad High Court, which was pending. Therefore, exercising its discretion, the Supreme Court declined to interfere with the High Court's order on the ground that the appellants had already pursued an alternative and adequate remedy, making the invocation of Article 226 inappropriate at that stage. The appeals were dismissed on this discretionary ground.

What were the issues?

1. Whether the Punjab High Court has jurisdiction under Article 226 of the Constitution to issue writs to the Income-tax Investigation Commission located in Delhi, when the assessees are within the U.P. State and their original assessments were made by U.P. authorities? Assessee's contention: The Punjab High Court has jurisdiction as the Investigation Commission is amenable to its jurisdiction by location, and the writs can be issued throughout the territories in relation to which it exercises jurisdiction. Revenue's contention: The Punjab High Court does not have jurisdiction because the assessees belong to the U.P. State, and the mere location of the Commission in Delhi does not confer jurisdiction on the Punjab High Court. 2. Whether the remedy provided under Article 226 of the Constitution is available to the petitioners, or if the remedies provided within the Taxation on Income (Investigation Commission) Act, 1947, are exclusive? Assessee's contention: Article 226 is available. Revenue's contention: The Act itself provides exclusive remedies, specifically under Section 8(5), and Article 226 is not available. The High Court also raised this as a preliminary objection. The judgment notes that the High Court did not express a final opinion on this point.

Which sections of the Income-tax Act were involved?

Section 5,Section 8(5),Section 66,Section 66-A

AI-generated summary — verify with the full judgment below

1953 Dwarkadas Shrinivas of Bombay v.

The Sholapur spinning and Weaziing Co. Ltd., and Others. 1954 Jan. 22. 738 SUPREME COURT REPORTS [1954)' to our Parliament to deprive a person of his property merely by passing an Act. The two parts of the article form an integral whole and cannot be dis- associated from each other.

The result is that I agree with the order proposed by my learned brother.

Appeal allowed.

Agent for the appellant : /. N. Shroff.

Agent for respondents Nos. 1 to 4 and 6 to 8 ~ Rajinder Narain.

Agent for respondent No. 9 : G. H. Rajadhyaksha. K. S. RASHID AND SON ti. THE INCOME-TAX INVESTIGATION COMMISSION, ETC. (With connected appeals) [MEHR CHAND MAHAJAN C. J., MuKHERJEA, S. R. DAs, VIVIAN BosE and GHULAM HASAN JJ.] Constitution of India, art. 226-/uri iction of Punjab High Court to issue writs to Income-tax Investigation Commission located in Delhi-Remedy under art. 226-Discretionary-Taxation on Income (Investigation Commission) (Act XXX of 1947), ss. 5 and 8(5).

The Punjab High Court has juri iction to issue a writ under art. 226 of the Constitution to the Income-tax Investigation Commission located in Delh

The order continues below.

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