COMMISSIONER OF INCOME TAX vs. ILAC LTD.

ITR/87/1986HC GujaratGJHC24010711198612 July 2001Author: HONOURABLE MR. JUSTICE ANIL R. DAVE,HONOURABLE MR. JUSTICE D.A.MEHTA2 pages
AI SummaryRemanded

What were the facts?

This case involves an Income Tax Reference filed by the revenue (Commissioner of Income Tax) at the instance of the Income Tax Appellate Tribunal, Ahmedabad Bench 'C', under Section 256(1) of the Income-tax Act, 1961. The reference concerns a question of law and fact regarding the jurisdiction of the Commissioner of Income-tax to pass an order under Section 263 of the Act. The respondent company, ILAC LTD., was ordered to be wound up. The High Court heard the learned advocate for the revenue, but no one appeared for the respondent company despite due service of notice on the Official Liquidator.

What did the High Court hold?

The High Court answered the referred question in the negative, in favour of the revenue and against the assessee. The reasoning was based on the law laid down by the same High Court in I.T.R. No. 120/86, decided on July 9, 2001. This implies that the High Court found that the Commissioner of Income-tax did have the jurisdiction to pass the order under Section 263, and therefore, the order of the Tribunal holding otherwise was incorrect. The operative direction was to dispose of the reference accordingly, with no order as to costs. The specific reasoning from the cited case (I.T.R. No. 120/86) is not detailed in this judgment.

What were the issues?

1. Whether the Appellate Tribunal has been right in law and on facts in holding that the Commissioner of Income-tax had no jurisdiction to pass an order under Section 263 of the I.T. Act, 1961, and hence his order was illegal? The revenue contended that the Tribunal erred in its finding regarding the Commissioner's jurisdiction. The assessee's contentions are not recorded in the judgment as no one appeared on their behalf. The issue hinges on the interpretation and application of Section 263 of the Income-tax Act, 1961, concerning the revisional powers of the Commissioner.

Which sections of the Income-tax Act were involved?

Section 256(1),Section 263

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

INCOME TAX REFERENCE No 87 of 1986

For Approval and Signature:

Hon'ble MR.JUSTICE A.R.DAVE and Hon'ble MR.JUSTICE D.A.MEHTA

============================================================ 1. Whether Reporters of Local Papers may be allowed : NO to see the judgements?

2.

To be referred to the Reporter or not? : NO 3. Whether Their Lordships wish to see the fair copy : NO of the judgement?

4.

Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder?

5.

Whether it is to be circulated to the Civil Judge? : NO

The order continues below.

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