H.K. BOSE C.J. - This is an application for a certificate under article 133(1) of the Constitution in respect of an order of a division bench of this court passed upon an application made under section 66(2) of the Indian Income-tax Act.
The petitioner company lent and advanced certain sums of money to a company known as Vishnu Industrial Co. (Private) Ltd., New Delhi, and the interest which the petitioner company received in respect of the loans was duly assessed by the income-tax authorities as interest on investment under section 10 of the Income-tax Act. The said Vishnu Industrial Co. (Private) Ltd. went into liquidation on September 29, 1954. At that time a sum of Rs. 2,85,792 was found due and payable by the said company to the petitioner company. In its return submitted to the income-tax authorities in respect of the assessment year 1955-56 (accounting year 1954-55) the said sum of Rs. 2,85,792 was sought to be written off as bad debt. The Income-tax Officer, Companies District II, however, by his order, dated December 29, 1955, rejected the petitioner company to write off the said sum of Rs. 2,85,792 as bad debt. The petitioner company thereupon preferred an appeal to the Appellate Assistant Commissioner, but this was dismissed on July 23, 1957. An appeal preferred by the petitioner company to the Appellate Tribunal against the said order of the Appellate Assistant Commissioner was also dismissed on November 21, 1959. The petitioner then moved the Income-tax Appellate Tribunal for stating a case with regard to certain alleged questions of law under section 66(1) of the Income-tax Act. The Appellate Tribunal rejected the said application. Thereupon this Court was moved under section 66(2) of the Income-tax Act for calling upon the Appellate Tribunal to state a case on the said questions, but this Court summarily rejected the application by its order dated January 2, 1961. It is against this order that the petitioner company now intends to prefer an appeal to this Supreme Court.
On behalf of the respondent a preliminary objection has been taken to the effect that the order of division bench dated January 2, 1961, is not a judgment, the decree or final order, within the meaning of article 133 of the Constitution and, as such, no appeal lies to the Supreme Court.
Reliance has been placed on behalf of the respondent on a decision of the Supreme Court in Seth Premchand Satramdas v. The State of Bihar. This was an appeal from an order of the Patna High Court, declining to call upon the Board of Revenue to state the case under section 21(3) of the Bihar Sales Tax Act with reference to an assessment made under that Act. The High Court of Patna had granted leave to appeal to the Federal Court following a full bench decision of the Lahore High Court in Feroze Shah Kaka Khel v. Commissioner of Income-tax. The Supreme Court, however, referred a special bench decision of the Patna High Court in Sri Mahant Harihar Gir v. Commissioner of Income-tax, where it was held that no appeal lay to His Majesty in Council under clause 31 of the Letters Patent of the Patna High Court from an order of the High Court dismissing an application under section 66(3) of the Income-tax Act (a provision similar to section 21 of the Bihar Sales Tax Act) to direct the Commissioner of Income-tax to state a case and approved of that case as laying down the correct law. The Supreme Court further pointed out that in order that an appeal lie to the Supreme Court, the order appealed against has to be either a judgment, decree or final order, but an order dismissing an application under section 21(3) of Bihar Sales Tax Act to direct the Board of Revenue to state a case and refer it to the High Court could not be regarded as an final order within the meaning of clause 31 of the Letters Patent of the Patna High Court in as much as such an order was advisory or consultative, and standing by itself it did not bind or affect the rights of the party, though the ultimate order passed by the Board of Revenue might be based on the opinion expressed by the High Court. It was further held by the Supreme Court that such an order passed by the High Court was not an order which passed in the exercise of either its appellate or its original jurisdiction within the meaning of clause 31 of Letters Patent of the Patna High Court.
The question whether an order of the High Court passed under section 66(2) of the Income-tax Act dismissing an application for the directing the Income-tax Appellate Tribunal to state the case is a judgment decree or final order, within meaning of article 133 of the Constitution from which an appeal lies to the Supreme Court came up for consideration before Punjab High Court in the case of Pehlad Rai and Company v. Commissioner of Income-tax and a division bench of that court, following the decision of the Supreme Court, to which reference has already been made, held that such an order passed by the High Court in the exercise of its jurisdiction under section 66(2) of the Income-tax Act was not a judgment, decree, or final order within the meaning of article 133 of the Constitution, and no appeal from such a decision was competent. The application for leave to appeal was, therefore, dismissed.
Similarly, in a decision of the Madras Court in Omar Salay Mohammed Sait v. Commissioner of Income-tax, Rajamannar C.J. held an order refusing an application under section 66(2) of the Income-tax Act for a direction to the Income-tax Appellate Tribunal to state a case and refer the question of law to the High Court was not an order from which an appeal lay to the Supreme Court under article 133 of the Constitution or sections 109 and 110 of the Code of Civil Procedure. The learned Chief Justice referred to the decision of Patna High Court which was approved by the Supreme Court in the case of Seth Premchand Satramdas v. State of Bihar and it was also pointed out by the learned Chief Justice that the full bench ruling of the Lahore High Court in the case of Feroze Shah v. Commissioner of Income-tax could no longer be regarded as good law in view of the observations of the Supreme Court in Seth Premchands case.
It appears to us that inasmuch as an order passed in an application under section 66(2) of the Income-tax Act cannot be said to dispose the case finally or by its own force to bind or affect the rights of the parties to such an application, such an order cannot be said to be a judgment, decree or final order, within the meaning of the expression, as used in article 133(1) of the Constitution. We, therefore, hold that no appeal lies to the Supreme Court from the order, which was passed by the division bench of this court on January 2, 1961, and this application must therefore be dismissed with costs.
DEBABRATA MOOKERJEE J. - I agree.