Commissioner of Income Tax vs Wazir Chand and Co. (P.) Ltd.

R.K. Gulati, J.—This application under sub-section (2) of section 256 of the income tax Act, 1961 (''the Act''), it appears to us, is misconceived and is not maintainable. The Commissioner, Lucknow feeling aggrieved by an order of the Tribunal, made on an application to it under sub-section (1) of section 256, for making a reference to this Court on the questions set out in the application. The Tribunal by its order dated 9-3-1990 drew up a statement of the case and circulated it to the parties. However, by its order dated 21-8-1990 the Tribunal recalled its earlier order and refused to forward the statement of the case to this Court, observing as under: In spite of number of opportunities given to the Commissioner of income tax the annexures are not filed. We, therefore, recall the draft statement of the case prepared and decline to draw up a statement of the case, since reference without annexures cannot be made to the Hon''ble High Court. For this we find support from the decision of Bombay High Court in the case of Commissioner of Income Tax Vs. John Fowler (I) Ltd. and others, .

It is in this background that the present application under sub-section (2) of section 256 has been filed proposing the same question that were raised in the application u/s 256(1). We have heard the learned counsel for the parties. A plain reading of sub-section (2) of section 256 would show that this sub-section entitles an assessee or the Commissioner, as the case may be, to apply to the High Court for a direction to the Tribunal to state the case where the Tribunal refuses to do so on the ground that no question of law arises. In other words, the sine qua non of availing of the jurisdiction of the High Court under sub-section (2) of section 256 is that the Tribunal had declined to state the case to the High Court on the ground that no question of law arises from its order. In the present-case, the Tribunal has not refused to refer the case on that ground. It rejected the reference application on the ground that the revenue had failed to supply the annexures mentioned in the draft statement despite several opportunities being allowed in that regard. In this view of the matter, in our opinion the applicant is not entitled to question the correctness of the order passed u/s 256(1) by taking recourse to sub-section (2) of that section. The Remedy of the applicant, if any, may lie elsewhere. The application in our opinion, is wholly misconceived.

We may refer to a decision of this Court in Govind Singh Bhagwan Singh Vs. Income Tax Officer I(VI), Now District Ward C, , in which the view taken was that where an application u/s 256(1) made to the Tribunal to state a case and refer to the High Court is rejected on the ground that it is barred by limitation, no application u/s 256(2) to the High Court to direct the Tribunal to state the case, lies. In that case it was noticed that subsection (2) of section 256 entitles an assessee to apply to the High Court for an order requiring the Tribunal to state the case and refer it, where the application u/s 256(1) had been refused by the Tribunal on the ground that no question of law arises. The view taken by us finds support from the earlier decisions of this Court.

For what has been stated above, this application is rejected as not maintainable. The assessee shall be entitled to its costs, which we assess at Rs. 125.