1. This is ah application under Section 66(3), Income-tax Act. The petitioner is the karta of a Hindu undivided family and as such made his return for the assessment year 1944-45. The Income-tax Officer made an assessment by his order dated 25-3-1949. There was an appeal therefrom to the Appellate Assistant Commissioner, who passed his order on 30-4-1951 reducing the assessment. An appeal was then preferred to the Income-tax Appellate Tribunal which was disposed of finally on 19-1953. The notice of the order under Sub- section (4) of Section 33 was served upon the petitioner on31-1-1955.
On 30-3-1953, the petitioner sent by registered post from Devakottai an application under Section 66 (1), Income-tax Act, requiring the Appellate Tribunal to state a case and refer certain questions of law to this court. On the same day the requisite fee of Rs. 100 was sent by Money order through the post office at Devakottai to the Income-tax Appellate Tribunal, Madras. The application was received by the officer of the Income-tax Appellate Tribunal, on 31-3-1953, but the Money order was received on 2-4-1953, one day late, the last day being 1-4-1953. The Appellate Tribunal rejected the application as barred by time. The Tribunal held that as the money order was received only on 2-4-1953 the application should be deemed to have been filed only on that day. Thereupon, the petitioner filed the present application. Section 66(3) of the Act runs thus: 'If on any application being made under Sub-section (1) the Appellate Tribunal rejects it on the ground that it is time barred, the assessee or the Commissioner, as the case may be, may within two months from the date on which he is served with notice of the rejection, apply to the High Court, and the High Court, if it is not satisfied of the correctness of the Appellate Tribunal's decision, may require the Appellate Tribunal to treat the application as made within the time allowed under Sub-section (1).' The material portion of Section 66(1) of the Act runs thus:
'Within sixty days of the date upon which he is served with notice of an order under Sub-section (4) of Section 33 the assessee or the Commissioner may, by application in the prescribed form, accompanied where application is made by the assessee by a fee of one hundred rupees, require the Appellate Tribunal to refer to the High Court any question of law arising out of such order, and the Appellate Tribunal shall within ninety days of the receipt of such application draw up a statement of the case and refer it to the High Court;'
2. The petitioner contends that the Appellate Tribunal's decision that his application under Section 66(1) was barred by time is not correct.
3. It is common ground that the Appellate Tribunal had no power to condone the delay, if any, inasmuch as Section 5, Limitation Act, is not made applicable to an application under Section 68(1), though it has been made applicable to an application under Sub-section (2) or (3). The only question, therefore, is whether the Appellate Tribunal was right in holding that the application was barred by time, as the money order was received one day too late.
4. At the end of the petitioner's application under Section 66(1), he made the following statement: 'Rs. 100 being the application fee is sent by money order today.'
5. There is no dispute as to the fact that on 30-3-1953 the petitioner did sent a money order for Rs. 100 and the coupon attached to the money order form contained a specific reference to the application. It is also not disputed that in the ordinary course the money order despatched on 30th March from Devacottai would be received in Madras on the succeeding day, 31st March. Indeed, the registered letter sent on the same day did reach the Tribunal's office on 31st March. In these circumstances, the petitioner contends that there has been compliance with the requirements of Section 66(1).
Learned counsel for the petitioner first argued that the principle of Section 27, General Clauses Act, should be applied to this case. That section runs thus:
'where any Central Act or Regulation made after the commencement of this Act authorises or requires any document to be served by post whether the expression 'serve' or either of the expressions 'give' or 'sent' or any other expression is used then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, prepaying and posting by registered post, a letter containing the document, and, unless the contrary is proved to have been effected at the time at which the letter would be delivered in the ordinary course of post.'
The fee of Rs. 100 must be deemed to have been received on the day on which it would have been delivered in the ordinary course of post, that is, 31st March.
Counsel for the Department relied in reply on certain rules of the Appellate Tribunal, 1946 made in pursuance of Sub-section (8) of Section 5-A, Income-tax Act, 1922. Rule 7 runs thus:
'(1) A memorandum of appeal to the Tribunal shall be presented by the appellant in person or by an agent to the Registrar at the headquarters of the Tribunal at Bombay, or to an officer authorised in this behalf by the Registrar, or sent by registered post addressed to the Registrar or to such officer.
(2) A memorandum of appeal sent by post under Sub-rule (1) shall be deemed to have been presented to the Registrar or to the Officer authorised by the Registrar, on the day on which it is received in the office of the Tribunal at Bombay, or as the case may be, in the office of such officer.'
Under Rule 36, Rule 7 is applicable 'mutatis mutandis' to an application under Sub-section (1) of Section 66. According to him, it is the date of the receipt in the office of the Tribunal that is the material date.
6. Applying Rule 7(11) read with Rule 36, it is clear that the application as such in the present case must be deemed to be in time because it was received in the office of the Tribunal on 31st March, that is, within time.
7. The question, therefore, which remains to be considered is, whether the application was not a valid application when received on that day, because it was not accompanied by the fee of Rs. 100. The ordinary meaning of 'accompany' is 'go with.' There is nothing in Section 66(1) of the Act or in any of the rules which prescribes that the fee should be enclosed along with the application. Learned Income-tax counsel admitted that it was sufficient compliance with the requirements of Section 66(1) to send along with the application a chalan from any local treasury in token of the payment of the requisite sum into that treasury. This concession probably would also imply that if the Money order receipt issued by the post office had been attached to the application, it would have been sufficient. That was not done in this case. But there was a statement at the end of the application that the money had been cent by money order on that day.
8. Before we pronounce our opinion on the point, we shall refer to the decisions cited to us bearing directly or indirectly on the point. The ruling of the Orissa High Court in -- 'Popsing Rice Mills v. Commr. of Income-tax, B. & O.', AIR 1949 Ori 53 was strongly relied on by the petitioner's counsel.
In that case, the assessee was served with notice of an order under Sub-section (4) of Section 33 of the Act on 4-12-1947. The assessee made a deposit of Rs. 100 in the Cuttack Treasury on 2-2-1948, being the sixtieth day from the date of service. That very day he sent an application to the Tribunal requiring it to refer the question to the High Court. That application was accompanied by the chalan and it was sent by registered post to the Tribunal's office at Madras. The application was received by the Tribunal on 6-2-1948, which was three days beyond the sixtieth day. The Tribunal rejected the petition as barred by limitation. The learned Judges, Ray C. J. and Panigrahi J. held that the application was in time. In their opinion, the time occupied in transmission of the application should not be computed as part of the period of limitation of sixty days, and in applying Rule 7 of the Income-tax Appellate Tribunal Rules 'mutatis mutandis' to the case of an application under Section 66(1) of the Act, Sub-rule (ii) of Rule 7 should be omitted, because presentation is not mentioned in or contemplated by Section 66(1), Ray C. J. observed thus: 'Reading Sub-section (1) of Section 66 of the Act in the light of Rule 7, so far as it prescribes the different modes of making an application to the Tribunal, the words 'require by application made to the Appellate Tribunal' may be construed to include sending an application to the Registrar or other authorised officer by registered post. In doing so, the applicant does all that he is required. in his power, to do in order to require the Tribunal to refer to the High Court any question of law arising out of Its order -- this of course is subject to the application being, in the ultimate, received by the Tribunal, For the purpose of compliance with the condition in the enactment, it is enough that the applicant puts the application into such a machinery for transmission that any delay therein and thereafter be completely beyond his control.'
This decision certainly helps the petitioner. But Mr. Rama Rao Sahib for the department has referred us to other decisions. The first of these is
-- 'Hajee Mahboob Bux Ehhan Illahi v. Commr. of Income-tax. U. P. : 18ITR72(All) , a decision of the Allahabad High Court.
The facts in that case were almost identical . with the facts in the present case. Two applications were sent by post from Allahabad to theAppellate Tribunal, Bombay Bench, on 1-12-1945. On the same day, a money order for Rs. 200 was also sent. The applications were received by the office of the Tribunal on 4-12-1945. But the money order was received only on 7-12-1945. The period of sixty days from the date of the service of the notice expired on 5-12-1945. The Appellate Tribunal rejected the applications on the ground that they were not received--within time.
The learned Judges held that though the applications were received on 4th December, that is, in time, as the fee was received only on the 7th, that is, after time, the Appellate Tribunal was justified in holding that the applications were not in order when presented, as they were not accompanied by the requisite fee. There is no discussion of the point now sought to be raised before us, and the learned Judges were more concerned with the applicability of Section 5, Limitation Act to the case before them.
'Motilal Hiralal v. Commr. of Income-tax, C. P. & Berar', AIR 1951 Nag 224 is the next case. The assessee there had time till 21-9-1949. The application was posted on 20th September and it reached the Tribunal's office on 24th September. The Tribunal dismissed the application as barred by time. The High Court of Nagpur held that the Tribunal was right. The learned Judges also held that 8. 5, Limitation Act, did not apply.
On the facts, this decision cannot directly apply to our case where admittedly the application reached the Tribunal's office in time. It may, however, be noticed that the learned Judges expressly dissented from the decision of the Orissa High Court in AIR 1949 Ori 53. In their opinion, the entire Rule 7 of the Appellate Tribunal Rules applies to applications under Section 66(1) of the Act. The reasoning in this decision is contained in the following extract from the judgment of Hidayatullah J.:
'Since the application under Section 66(1) is to 'require' the Tribunal to refer a case the obvious construction is that the 'requiring' must be within 60 days. Now a person is 'required' to do something only when he knows of it and not while the letter is lying in a post office unknown to him. The Tribunal is 'required' to refer the questions when the application reaches the Tribunal and not before. The subsection nowhere uses the phrase 'require by an application made within 60 days' which has been expounded in the Orissa High Court.'
The last of the decisions is that of the High Court of Punjab in 'Khushi Ram Raghunath Sahai v. Commr. of Income-tax', (D). In this case, the copy of the order of the Appellate Tribunal was received by the petitioner on 28-9-1950. The assessee's application under Section 66(1) was posted at Amritsar on 27-11-1950, and was 'received in the office of the Tribunal on 28-11-1950. The last day was the 27th. The Appellate Tribunal rejected the application as barred by time, and the High Court held that the Tribunal was right. Here again, on the facts, there is a vital difference between that and the present case. It suffices to mention that the learned Judges expressly dissented, as the Allahabad High Court did, from the decision of the Orissa High Court in AIR 1949 Ori 53.
9. Another case, which. was not cited at the Bar, may also toe referred to, namely, -- 'Ganesh Prasad v. Commr. of Income-tax', AIR 1942 All 251, There, the due date for the application for reference was 13-3-1939. It was filed on 16-2-1939, but it was not accompanied by a fee of Rs. 100 as required. The assessee was informed that the said sum should be remitted immediately. But it was only on 13-3-1939, the very last day of limitation, that the assessee sent the said sum by insured letter, and it was received in the office of the Commissioner of Income-tax on 15-3-1949. The Commissioner of Income-tax rejected the application, and the learned Judges of the High Court agreed with the Commissioner.
10. It will be seen that the facts in the present case are not similar to the facts in any of the case above referred to, except : 18ITR72(All) and (D), the application was posted on the last date, and in AIR 1951 Nag 224, it was posted one day before but received by the office later than the due date. In AIR 1942 All 251, though the application was posted in time, the money was not remitted till the last day.
In the case before us, the application was posted and received within time. It is not, therefore, necessary for us to decide whether the view taken by the Orissa High Court in AIR 1949 Ori 53 is right. We are inclined, however, not to agree with respect, with the learned Judges of the Orissa High Court in so far as they held that the time occupied in transmission of the application should not be computed as part of the period of sixty days. We do not wish to say more than that. The question in the present case is whether an application which was sent in time was not proper because it was not 'accompanied' by the requisite fee of Rs. 100. The facts in : 18ITR72(All) . are no doubt on all fours because there too, as here, the money order was despatched on the same day as the application by registered post, but the money order was received after the expiry of sixty days. Unfortunately, there is little or no discussion of the point now raised before us. All that the learned Judges say is:
'Prom the narration of facts given above it would appear that though the applications were received on 4-12-1945, they were not accompanied by a fee of Rs. 100 each and the fee was received oh 7-12-1945, i.e., two days after the expiry of sixty days. The appellate Tribunal was, therefore, justified in holding that the applications were not in order when presented and when the money was received and defects removed the applications had become time-barred.' We, therefore, find ourselves free to express our opinion on the point as if it were 'res integra'.
It appears to us that the words 'accompanied by a fee of Rs. 100' should not be given a too literal interpretation. It cannot obviously be contended, for Instance, if a money order for Rs. 100 is sent as the required fee and is received by the office of the Tribunal in tune but the application itself is received sometime later but also in time, that the requirements of Section 66 are not fulfilled. Or again, it the money had been paid into a treasury earlier and the application is made later, it cannot, be said that the application is not valid. 'Accompanied' cannot' mean necessarily that the sum of Rs. 100 or something representing that sum should be contained in the same envelope as the application or that both the application and the money should be delivered together at the same time. It is equally obvious that the application is not complete without the payment of the fee. In our opinion, a reasonable construction of this requirement would be that the assessee should have made the payment of the said sum in such time that in the ordinary course it would either be received or deemed to be received (as in the case of a chalan) within the time allowed.
11. Here, the assessee did pay into the post officethe said sum to the order of the Tribunal on30-3-1953 and in the ordinary course of events themoney would have reached the Tribunal the succeeding day, 31-3-1953, that is, before the duedate. Intimation of the fact of the sending ofthe money order was given in the application itself. The money had been paid and there wasno impediment in the way of the money reaching the Tribunal on or before the due date. Insuch circumstances, we think it should be heldthat the application was accompanied by the feeof Rs. 100. Rule 7(ii) of the Appellate Tribunalrules will not directly stand in the way of thisconstruction because it does not refer to the payment of the fee. We, therefore, hold that theAppellate Tribunal was not correct in its decision, that the application was not within time.We direct the Tribunal to treat the applicationas made within the time allowed under Sub-section (1) of Section 66, Income-tax Act.