Rukmani Bai Vs. Commissioner of Income Tax. - Court Judgment

Excerpt:
head note: income tax reference--question of fact--return bona fide belief for not filing the return. ratio: question as to whether assessee had a bona fide belief for not filing the return is a question of fact. held: the tribunal and the other authorities have consistently found that there was no reason for the assessee to have harboured a belief that she was not required to file the return and in fact as per the observation of the tribunal, material evidence had been suppressed by the assessee in this behalf thus, leading to inference against the assessee. the question of bona fide belief was essentially one of the fact and cannot give rise to any question of law justifying reference to this court under section 256(2) of the income tax act. application: also to current assessment years a. y.: 1975-76 and 1976-77 income tax act 1961 s.256(2) - constitution of india 1055. article 141; [a.k. patnaik, c.j., dipak misra, abhay gohil, s. samvatsar, & s.k. gangele, jj] dismissal of slp arising from decision of high court whether binding precedent decision of division bench in rama and company v. state of madhya pradesh, [2007(ii) mpjr 229] overruled by full bench of same high court prior to delivery of decision of full bench order passed in division bench decision assailed in slp before supreme court dismissal of slp by short reasoned order, though declaration of law, but high court is bound to follow earlier decisions in field regard being had to concept of precedents as per law laid down by apex court and larger bench decision in jabalpur bus operators association, reported in [2003(1) mpjr 158]. court clarifies that dr. jaidev siddha v. jaiprakash siddha, 2007(2) mpjr (fb) 361; air 2007 mp 269 (fb) is not impliedly overruled in view of dismissal of slp articles 226 & 227; [a.k. patnaik, c.j., dipak misra, abhay gohil, s. samvatsar, & s.k. gangele, jj] power to issue writ under article 226 - [per majority] the high courts exercise original jurisdiction under article 226 of the constitution and supervisory jurisdiction and the power of superintendence under article 227 of the constitution. but, an eloquent and fertile one, a writ of certiorari is issued in exercise of original jurisdiction. whenever word supervisory has been used in the context of article 226 it is in contrast with the appellate or revisional jurisdiction. when a writ is issued under article 226 of the constitution in respect of courts or tribunals it is done in exercise of original jurisdiction and the parameters are different than article 227 of the constitution of india. it is worth noting that the power under article 227 was there in a different manner under the government of india act. power of superintendence is distinct from the exercise of power of revisional or supervisory jurisdiction which is a facet of the power of superintendence. the confusion occurs when one applies the principle of equivalence or equates the exercise of supervisory power and power of superintendence with original or supervisory jurisdiction. there is an acceptable nuance between the concept of jurisdiction and exercise of power by certain parameters. both do come within the fundamental concept of judicial review but the jurisdiction exercised is different when under article 226 a writ is issued it is issued in exercise of original jurisdiction whether against a tribunal or inferior courts or administrative authorities. the word superintendence has not been used in article 226 of the constitution. it is also evident that the term writs is not referred to in article 227. on a scrutiny of article 227 it would be crystal clear that power of superintendence conferred on the high courts is a power that is restricted to the courts and tribunal in relation to which it exercises jurisdiction. on the contrary the power conferred on the high court under article 226 is not constricted and confined to the courts and tribunals but it extends to any person or authority. be it noted, article 226 as has been engrafted in the constitution covers entirely a new area, a broader one in a larger spectrum. when the legislature has used the terms in exercise of original jurisdiction and supervisory jurisdiction it has to be understood that they are used in contradistinction in the constitutional context as has been interpreted by the apex court. the words of the section have to be understood to mean exercise of powers under article 226 of the constitution of india which is always original. -- m.p. samaj ke kamjor vargon ke krishi bhumi hadapne sambandhi kuchakron se paritran tatha mukti adhiniyam [3/1977]. section 2: writ appeal maintainability from order of single judge-when permissible held, maintainability of a writ appeal from an order of the learned single judge would depend upon many an aspect and cannot be put into a strait jacket formula. it cannot be stated with mathematical exactitude. it would depend upon the pleadings in the writ petition, nature of the order passed by the single judge, character and the contour of the order, directions issued, nomenclature given and the jurisdictional prospective in the constitutional context are to be perceived. it cannot be said in a hyper-technical manner that an order passed in a writ petition, if there is assail to the order emerging from the inferior tribunal or subordinate courts has to be treated all the time for all purposes to be under article 227 of the constitution of india. it would depend upon the real nature of the order passed by the learned single judge. the pleadings also assume immense significance. it would not be an over emphasis to state that an order in a writ petition can fit into the subtle contour of articles 226 and 227 of the constitution in a composite manner and they can co-inside, co-exist, overlap or imbricate. in this context it is apt to note that there may be cases where the single judge may feel disposed or inclined to issue a writ to do full and complete justice because it is to be borne in mind that article 226 of the constitution is fundamentally a repository and reservoir of justice based on equity and good conscience. it will depend upon factual matrix of each case. dr. jaidev siddha v. jaiprakash siddha, 2007(2) mpjr (fb) 361: air 2007 mp 269 (fb) is not impliedly overruled in view of dismissal of slp preferred against order reported in rama and company v. state of madhya pradesh [2007 (2) mpjr 229 (db) (mp)]. s. k. kulshrestha, j. :the applicant seeks reference under s. 256(2) of the it act, 1961 of the following questions stated to be arising out of the order of the tribunal pertaining to the asst. yrs. 1975-76 & 1976-77 :'asst. yr. 1975-76 :1. whether the order upholding the penalty is vitiated in law as having been passed ignoring material evidence on record regarding additions and renovations in house from february, 1973 to dewali 1974 and not during financial year 1974-75 alone and there was substantial agricultural income of the assessee besides grains business income of her husband.2. whether, the presumption that the assessee concealed taxable income of rs. 15,000 when the assessee had tax-free agricultural income of about rs. 9000 for 6 years and her husband separate business income of about rs. 5,000 and those years were cheap years, was rational and reasonable so as to attract penalty.3. whether, on the facts and in the circumstances of the case, the tribunal was right in law in holding that the assessee was guilty of failing to furnish the return of income without reasonable cause under s. 271(1)(a) of the l.t. act.4. whether, on the facts and in the circumstances of the case, the order of the tribunal holding that the assessee did not establish that she had a bona fide belief that her income was much below taxable limit is reasonable and rational.5. whether, the levy of penalty under s. 271(1)(a) is justified and valid in law.6. whether, penalty under s. 271(1)(a) levied while the assessment was still protective was valid in law'.asst. yr. 1976-77 :1. whether the presumption that the assessee concealed taxable income of rs. 30,000 or furnished inaccurate particulars of income when the assessees only source was tax-free income from agriculture for the last 7 years and expenses on children were being met out of her husbands grains business income was reasonable and rational so as to attract penalty for not filing the return in time.2. whether, on the facts and in the circumstances of the case the tribunal was right in law in holding that the assessee was guilty of failing to furnish the return of income without reasonable cause under s. 271(1)(a) of the it act.3. whether, on the facts and in the circumstances of the case, the order of the tribunal holding that the assessee did not establish that she had a bona fide belief that her income was much below taxable limit is reasonable and rational.4. whether, the levy of penalty under s. 271(1)(a) is justified and valid in law.5. whether, penalty under s. 271(1)(b) levied while the assessment was still protective was valid in law.2. the assessee did not file the returns on assumption that her income was below the taxable limit. the ao completed the assessment and found that the income of the assessee was above the taxable limit. the assessee, therefore, filed an appeal in respect of the said assessment years and the tribunal also held that the income was above the taxable limit. before the taxing authority and the tribunal, the case of the assessee was that the returned income was much below the taxable limit and the additions which were finally confirmed by the tribunal were on the basis of unexplained investment in the immovable properties. the aac after discussing the legal position had observed that the income of the assessee had already been confirmed by the tribunal and that it was much above the taxable limit. the penalties under s. 271(1)(a) and 273(b) of the it act were also levied. however, the ito was directed to recompute the quantum of penalty under s. 271(1)(a) for the assessment years in question and as regards penalty under s. 273(b), it was observed that ito had imposed minimum penalty.3. a second appeal was filed in the tribunal which was decided by the tribunal in ita nos. 148 to 151/jab/83 by order dt. 7th february, 1991 (annex.-h). the tribunal found that the assessee had not been able to establish that she had a bona fide belief that her income was much below the taxable limit. the tribunal also observed that the assessee had withheld the material and as such adverse inference was drawn. the tribunal observed that there could not have been any savings from the agricultural income of the assessee upto 20th august, 1975 and an addition of rs. 30,000 was therefore made by the ito as undisclosed income in the hands of the assessee. the addition was however sustained in the sum of rs. 25,000 and the penalty levied was confirmed.4. the assessee filed an application under s. 256(1) for seeking reference of the question of law which was rejected by the tribunal by order dt. 12th december, 1991 (annex.-k) and hence the present application under s. 256(2) of the act has been filed.5. we have heard the learned counsel for the parties and perused the record.6. the learned counsel for the applicant has referred to the decision in cit vs . r. k. golecha of the rajasthan high court, hindustan steel ltd. vs . state of orissa : [1972]83itr26(sc) of the supreme court, cit vs. shri krishandas agarwal & ors. [1946] 14 itr 799 of this court and cit vs. baroda tin works (1996) 135 ctr (guj) 126 of the gujarat high court and has contended that if there has been delay in filing of the return under a bona fide belief that the assessee did not have the income requiring such a return of income the penalty could not have been imposed. we are unable to agree with the contention of the learned counsel in the facts of the present case. the tribunal and the other authorities have consistently found that there was no reason for the assessee to have harboured a belief that she was not required to file the return and in fact as per the observation of the tribunal, material evidence had been suppressed by the assessee in this behalf thus, leading to inferences against the assessee. the question of bona fide belief was essentially one of the fact and cannot give rise to any question of law justifying reference to this court under s. 256(2) of the it act. accordingly, we find that the questions stated in the application and reproduced hereinabove do not arise in the present case.7. in the result, this application is dismissed but with no order as to costs.