COMMISSIONER OF INCOME-TAX vs. FARDAHMED ABDULSAMAD

ITR/15/1990HC GujaratGJHC24013202199004 October 2001Author: HONOURABLE MR. JUSTICE MOHIT S. SHAH,HONOURABLE MR. JUSTICE D.A.MEHTA2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court declined to answer the questions referred by the revenue. This decision was based on the common ground between the parties that the High Court should follow its own prior judgment in the assessee's own case, specifically Income Tax Reference No. 202 of 1986, decided on August 13, 2001. In that previous reference, the Court had declined to answer the questions raised. Consequently, the present reference was disposed of without answering the questions. The ratio decidendi is that where a High Court has already decided a similar reference for the same assessee, it will follow its previous decision and decline to answer a subsequent reference on identical or similar issues, especially when both parties consent to this course of action. No specific finding was given on the merits of the ITAT's order or the Commissioner's order.

What were the facts?

The Commissioner of Income-tax (CIT) referred two questions of law to the High Court of Gujarat at Ahmedabad concerning an assessment year not specified in the judgment. The questions arose from an order passed by the Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench "C". The ITAT had cancelled an order made by the CIT under section 263 of the Income Tax Act, 1961. The second question pertained to the taxation of trust income where the assessee was a trustee, with the ITAT holding that the income should be taxed in the hands of the trust on a substantive basis and excluded from the assessee's income. Both the revenue and the assessee agreed to follow a previous decision of the High Court in the assessee's own case (Income Tax Reference No. 202 of 1986) which had declined to answer the questions raised.

What were the issues?

The Tribunal had to decide two questions of law referred by the revenue: 1. Whether the Appellate Tribunal is right in law and on facts in cancelling the order made by the Commissioner of Income-tax under section 263 of the I.T.Act? 2. Whether the Appellate Tribunal is right in law and on facts in holding that the income of the trust in which the assessee was a trustee, is to be taxed in the hands of the trust on a substantive basis and to be excluded from the income of the assessee? Contentions: Assessee: The assessee argued that the High Court should follow its previous decision in Income Tax Reference No. 202 of 1986, where similar questions concerning the assessee were declined to be answered. Revenue: The revenue also urged the High Court to follow its decision in Income Tax Reference No. 202 of 1986, as the present reference involved the same assessee and the Tribunal had relied on its own order in the assessee's case for earlier years.

Which sections of the Income-tax Act were involved?

Section 263,Section 256(1)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

INCOME TAX REFERENCE No 15 of 1990

For Approval and Signature:

Hon'ble MR.JUSTICE M.S.SHAH 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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