THANTHI TRUST Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is an application for stay of collection of income -tax pending the reference in T. C. No. 1240 of 1979, relating to the assessment year 1968 -69. The learned counsel for the petitioner contended that from 1962 to 1967, the petitioner had been crediting the account of the educational institution with the amounts in question, that the I. T. Dept. did not raise any objection whatever, that suddenly with reference to the assessment year 1968 -69, a new Income -tax Officer changed his view and took the stand that the mere crediting of the account was not enough, that the amounts should have been actually paid in order to attract the exemption under s. 11 of the I. T. Act, and that, otherwise the petitioner was liable to pay the tax, and that, accordingly, the petitioner had been subjected to tax. According to the learned counsel for the petitioner, the said action of the Income -tax Officer is the subject -matter of a few writ petitions pending on the file of this court, as well as of the reference in question. It is pending the reference under s. 256 of the I. T. Act, 1961, that the petitioner prays for the stay of collection of Rs. 5, 64, 056.

(2.) THE learned counsel for the Department, Thiru A. N. Rangaswami, raised a preliminary objection that this court has no jurisdiction to grant stay of the collection of the tax pending a reference under s. 256 of the I. T. Act, and in support of this contention he relied on an unreported judgment of the Calcutta High Court in Dwarka Prasad Bajaj vs Commissioner of Income -tax.

(3.) FROM the above passage, it is clear that the Supreme Court not only did not disapprove of the decision of the Andhra Pradesh High Court referred to already, but might be taken to have approved of the decision of the Andhra Pradesh High Court. The learned counsel for the Department contended that the question before the Supreme Court was different, namely, whether the Appellate Tribunal had power to grant stay of collection of tax or not and on that question the decision of the Andhra Pradesh High Court referred to above had no bearing. Still so long as the Supreme Court has referred to the judgment of the Andhra Pradesh High Court and also referred to the rationale behind the conclusion reached by that court, without expressing any disapproval, we must proceed on the basis that the Supreme Court had approved of the reasoning behind the decision of the Andhra Pradesh High Court in the case referred to above. In view of this, we cannot hold that the unreported decision of the Calcutta High Court can be acted upon.