RAJESWARI EXPORT HOUSE Vs. INCOME TAX APPELLATE TRIBUNAL

JUDGEMENT

(1.) The Senior Standing Counsel for the Government of India (Taxes) takes notice on behalf of the respondents.

(2.) By this writ petition the petitioner seeks the issue of a writ of mandamus directing the first respondent, the Income Tax Appellate Tribunal to ignore the judgment in ITR 121 of 1981 and pass final orders in ITA 133 of 1973-79 under S.260(1) of the Income Tax Act in conformity with a subsequent decision of a Full Bench of this court reported in Commissioner of Income Tax v. Issac ( 1987 (2) KLT 429 ). The decision in ITR 121 of 1981 is inter partes on a reference made by the Income Tax Appellate Tribunal, Cochin Bench at the instance of the revenue. The question was whether the Inspecting Assistant Commissioner had jurisdiction to impose penalty under S.271(1)(c) of the Income Tax Act after sub-s. (2) of S.274 was omitted by the Taxation Law (Amendment) Act, 1975 which came into force on 1-4-1976. This court following an earlier Division Bench decision in ITR 1 of 1979 reported in Kunhimuhammed and Bros. v. CIT (Ker.) (152 ITR 691) held that the Inspecting Assistant Commissioner continues to nave jurisdiction even after the deletion of sub-s. (2) of S.274 and the reference was accordingly answered in favour of the revenue. A Full Bench of this court in Isaac's case (1987 (2) KLT 429) has however taken the view that the IAC. ceased to have jurisdiction to impose penalty under S.271(1)(c) of the Income Tax Act after sub-s. (2) of S.774 was omitted by the Taxation Law (Amendment) Act 1975. Since the appeal is even now pending before the first respondent Tribunal, the petitioner seeks a direction for its disposal in accordance with the later decision in Issac's case.

(3.) As earlier stated the decision in ITR 121 of 1981 is inter partes and the Tribunal is bound to pass final orders in conformity with the judgment therein. Sub-s. (1) of S.260 of the Income Tax Act expressly enjoins the Tribunal to "pass such orders as are necessary to dispose of the case conformably to such judgment".