Commissioner of Income-tax Vs. Mohinder Lal - Court Judgment

Excerpt:
- sections 80 (2) & 89 & punjab motor vehicles rules, 1989, rules 85 & 80: [t.s. thakur, cj, jasbir singh & surya kant, jj] appeal against orders of state or regional transport authority imitation held, a stipulation regarding the period of limitation available for invoking the remedy shall have to be strictly construed. that is because any provision by way of limitation is in the nature of a restraint on the remedy provided under the act. so viewed two inferences are clear viz., (1) sections 80 and 89 of the act read with rule 85 of the rules make it obligatory for the authorities making the order to communicate it to the applicant concerned and (2) the period of limitation for any appeal against the order is reckonable from the date of such communication of the reasons would imply communication of a copy of the written order itself, a party who knows about the making of an order cannot ignore the same and allow grass to grow under its feet and do nothing except waiting for a formal communication of the order or to choose a tenuous plea that even though he knew about the order, he was waiting for its formal communication to seek redress against the same in appeal. if a party does not know about the making of the order either actually or constructively it may claim that the period of limitation would start running from the date it acquires knowledge of the making of an order but one cannot understand how a party, who has acquired knowledge of the making an order either directly or constructively can ignore the same and belatedly seek redress just because the authority making the order had made a default in formally communicating the order to him. allowing a party to do so would amount to placing a premium on the lack of diligence of a party, who is remiss in seeking a remedy that was available to it. therefore, knowledge whether actual or construction of the order passed by the state or regional transport authority should result in commencement of the period of limitation. thus,. in cases where the state or regional transport authority has not communicated the order of refusal passed to the persons concerned, the period of limitation for filing an appeal would commence from the date when the parties concerned acquire knowledge of passing of the said order. - it is no doubt well-settled that the right of appeal is a substantive right and it gets vested in a litigant no sooner the lis is commenced in the court of the first instance, and such right or any remedy in respect thereof will not be affected by any repeal of the enactment conferring such right unless the repealing enactment either expressly or by necessary implication takes away such right or remedy in respect thereof. ' it is true that under clause (c) of the proviso to section 4 of the central act, xxx of 1956 (which corresponds to section 6(e) of the general clauses act, 1897), it is provided that a remedy or legal proceeding in respect of a vested right like a right to an appeal may be instituted, continued or enforced as if this act (meaning the repealing act) had not been passed.d. s. tewatia, j.1. the following question which has been referred by the tribunal at the instance of the commissioner of income-tax, jullundur, for the opinion of this court pertains to the jurisdiction of the inspecting assistant commissioner to decide the question of penalty and the consequent imposition of penalty of rs. 58,000 by him, vide order dated february 25, 1978, under section 271(1)(c) of the income-tax act :'whether the tribunal has been right in law in holding that the penalty amounting to rs. 58,000 imposed by the inspecting assistant commissioner, vide order dated february 25, 1978, under section 271(1)(c) of the income-tax act, in pursuance of a reference admittedly made under section 274(2) on december 23, 1976, was without jurisdiction in view of the fact that sub-section (2) of section 274 had been omitted by section 65 of the taxation laws (amendment) act, 1975, with effect from april 1, 1976?'2. mr. ashok bhan, appearing for the petitioner, has canvassed that the order dated december 13, 1979, of the tribunal holding that the inspecting assistant commissioner had no jurisdiction to deal with the question of imposition of penalty under section 271(1)(c) of the income-tax act (hereinafter referred to as 'the act'), on the date he passed the order imposing penalty, i.e., february 25, 1978, because as a result of the taxation laws (amendment) act, 1975 (hereinafter referred to as 'the amending act'), which took effect from april 1, 1976, the income-tax officer alone was competent to deal with the question of imposition of penalty and the jurisdiction of the inspecting assistant commissioner envisaged under sub-section (2) of section 271 of the act stood abolished as a result of the deletion of sub-section (2) of section 274 with effect from april 1, 1976, as a result of the amending act, ran counter to the division bench decisions of this court in cit v. raman industries cit v. sadhu ram cit v. mela ram jagdish raj & co. and telu ram raunqi ram v. cit besides the decisions of other high courts, namely, cit v. r. ochhavlal & co. [1976] 105 itr 518, cit v. royal motor car co. : [1977]107itr753(guj) laltaprasad goenka v. cit : [1983]143itr924(bom) , continental commercial corpn. v. ito : [1975]100itr170(mad) cit v. eastern development corpn. : [1982]135itr516(cal) , addl. cit v. dr. khaja khutabuddinkhan : [1978]114itr905(ap) and cit v. balabhai & co. : [1980]122itr301(guj) .3. perusal of the judgment of the tribunal dated december 13, 1979, would show that the tribunal, inter alia, has based its decision on the allahabad high court judgment in cit v. om sons : [1979]116itr215(all) , which view has been reiterated by the same high court in a judgment in cit v. pearey lal radhey raman : [1979]117itr319(all) .4. mr. gupta, appearing for the respondent, has added to the above list, the karnataka high court judgment in r. abdul azeez v. cit 0065/1980 : [1981]128itr547(kar) and later the allahabad high court judgments in ganesh dass ram gopal v. iac of i.t. : [1983]142itr101(all) and mohd. oais & co. v. cit : [1983]142itr104(all) .5. from the above, it is clear that the various high courts have taken a contrary view in regard to the existence of jurisdiction of the inspecting assistant commissioner on the date he passed the order if before that as a result of the provision giving him jurisdiction in the matter has been amended in a way depriving him of the jurisdiction to deal with the question of imposition of penalty.6. there is also difference of opinion as to whether the relevant date is the date on which the income-tax officer has made a reference to the inspecting assistant commissioner or the date on which he had initiated penalty proceedings on his file for the purpose of seeing as to whether on the date on which the inspecting assistant commissioner passed the order, he had the requisite jurisdiction to deal with the matter or not.7. mr. gupta on behalf of the respondent, has questioned the basic postulate that the right to have a cause tried in a given forum is not a vested interest. mr. gupta asserts that what is a vested right is a right to the remedy. the forum where the right is to be asserted or remedy is to be sought pertains to the procedure. since the procedural law is admittedly given retrospective effect in that it applies even to pending cases, the forum where the right to a remedy can be pursued is the one which is described in the procedural law of the day. mr. gupta sought support for his above submission from maria christine de souza v. soddar maria zurna pereiro pinto, : air1979sc1352 , and drew pointed attention to the following observations of their lordships (p. 1354):'the contention that since the right of appeal had been conferred by the portugese code, the forum where it could be lodged was also governedby the portuguese code cannot be accepted. it is no doubt well-settled that the right of appeal is a substantive right and it gets vested in a litigant no sooner the lis is commenced in the court of the first instance, and such right or any remedy in respect thereof will not be affected by any repeal of the enactment conferring such right unless the repealing enactment either expressly or by necessary implication takes away such right or remedy in respect thereof. this position has been made clear by clauses (b) and (c) of the proviso to section 4 of the central act xxx of 1956 which substantially corresponds to clauses (c) and (e) of section 6 of the general clauses act, 1897. this position has also been settled by the decisions of the privy council and this court (vide colonial sugar refining co. ltd. v. irving [1905] ac 369 and garikapati veeraya v. n. subbiah choudhry : [1957]1scr488 , but the forum where such appeal can be lodged is indubitably a procedural matter and, therefore, the appeal, the right to which has arisen under a repealed act, will have to be lodged in a forum provided for by the repealing act. that the forum of appeal and also the limitation for it, are matters pertaining to procedural law will be clear from the following passage appearing at page 462 of salmond's jurisprudence (12th edn.): 'whether i have a right to recover certain property is a question of substantive law, for the determination and the protection of such rights are among the ends of the administration of justice ; but in what courts and within what time i must institute proceedings are questions of procedural law, for they relate merely to the modes in which the courts fulfil their functions.' it is true that under clause (c) of the proviso to section 4 of the central act, xxx of 1956 (which corresponds to section 6(e) of the general clauses act, 1897), it is provided that a remedy or legal proceeding in respect of a vested right like a right to an appeal may be instituted, continued or enforced as if this act (meaning the repealing act) had not been passed. but this provision merely saves the remedy or legal proceeding in respect of such vested right which it is open to the litigant to adopt notwithstanding the repeal but this provision has nothing to do with the forum where the remedy or legal proceeding has to be pursued. if the repealing act provides a new forum where the remedy or the legal proceedings in respect of such vested right can be pursued after the repeal, the forum must be as provided in the repealing act.' 8. mr. gupta also referred us to the karnataka high court decision in r. abdul azeez's case 0065/1980 : [1981]128itr547(kar) , which had followed the ratio of the aforesaid decision of the supreme court.9. if there is no vested right to a forum for trying a case or for hearing an appeal or revision, the forum being a part of the procedural law, thenwe are afraid, the decisions relied upon by mr. ashok bhan, including those which have been rendered by this court, do not appear to lay down the correct law. since the division bench decisions of this court are binding upon us, the appropriate course available to us is to refer the reference for decision to a larger bench. we, therefore, direct the office to place the papers of this case before the acting chief justice for constituting the larger bench.