Income Tax Officer vs K. Jayaraman

Chandurkar, C.J.—On notice of motion, this appeal comes up for admission today. Mr. B. Shanthakumar appear for the respondent. Heard

both sides. Appeal admitted.

This appeal filed by the revenue is to challenge the correctness of certain statement of law made by the learned single judge in his order under

appeal.

The writ petition itself was filed by the respondent for a direction that the original will dated January 1, 1977, impounded by him in pursuance of

an order dated January 15, 1985, should be returned forthwith to the respondent herein. The learned judge undoubtedly directed return of the will

on the respondent furnishing an undertaking that he will produce the original will as and when is called upon to do so and getting a xerox copy of

the will on record. But he has made certain observations, which appears to us to be unnecessary, with regard to the jurisdiction of the Income Tax

Officer to go in to the question of the truth or genuineness of the will. These observations are as follows :

In so far as the Income Tax Department, has no jurisdiction to decide the truth or genuineness of the will, I see no justification for the retention of

the will.

Learned counsel appearing on behalf of the Revenue has made it clear to us that the appeal is filed only because the Revenue is aggrieved by the

observation that the Income Tax Department has no jurisdiction to decide the truth or genuineness of the will. The other part of the order is not

challenged.

Mr. Shanthakumar of behalf of the assessee has taken the stand that observations of which grievance has been made became necessary

because of the counter-affidavit filed by the successor-income tax Officer in which in connection with the assessment order made by the earlier

Income Tax Officer he has stated that he has taken the view that said will is not a genuine document and it has been fabricated only to convert the

individual properties of the respondent herein into joint family properties.

It is not in dispute that no such finding has been recorded by the earlier Income Tax Officer in his assessment order. However, the order of the

learned judge has the effect of laying down a legal proposition with regard to the jurisdiction of the Income Tax Department and the observations

made by the learned judge have to be read independent of the averments made in the affidavit, though it may be that those observations became

necessary because of the stand taken in the counter-affidavit. However, the fact remains that the effect of the observations which the learned judge

has made is that the Income Tax Department is held to have had no jurisdiction at all to decide the genuineness of the will. We are unable to find

ourselves in agreement with the view taken by the learned judge. The authorities functioning under the Income Tax Act are authorities exercising

statutory and investigative jurisdiction. As pointed out by the Division Bench of this court in V. Datchinamurthy and Another Vs. Asst. Director of

Inspection, (Intelligence), I.T. Dept. and Another, , the Income Tax Officer is, within the limits assign to him under the Act, a Tribunal of exclusive

jurisdiction for the purpose of assessment to Income Tax and that any proceedings or adjudication on an issue in a civil litigation between the

taxpayer and an adversary of his, is not binding in any proceedings for assessment. The Division Bench has referred to the decision of the Supreme

Court in CHHATRASINHJI KESARISINHJI THAKORE Vs. COMMISSIONER OF Income Tax, BOMBAY CITY II., in which the

Supreme Court has examined the powers and jurisdiction of the Income Tax Office in relation to the assessment as contrasted with other statutory

adjudications. In the context of the determination of the question whether a receipt of money was income or was taxable, the Supreme Court

observed at page 567 as follows :

There is nothing in the Income Tax Act which prevents the revenue authorities from determining the quantum of the amount which is payable by

the appellant as local fund cess, when that question properly arises before them in the course of proceedings for assessment. The Income Tax

Officer is, within the limits assign to him under the Act, a tribunal of exclusive jurisdiction for the purpose of the assessment of Income Tax. He has

under the Act to decide whether a particular receipt is income, and it is not predicated that he must make some person or body other than the

assessee who may be concerned with that receipt as a party to the proceeding before he decides that question. As between the State and the

assessee, it is his function alone to determine whether the receipt is income and is taxable. The determination by the Income Tax Officer may be

questioned in proceedings before superior tribunals which are permitted by the Act, but the Income Tax Officer cannot be prevented from

determining a question which properly arises before him for the purpose of the assessment of tax, merely because his determination may not bind

some other body or person qua the assessee.

An authority of limited jurisdiction is entitled to decide any question that arises before it for the purposes of exercise of the jurisdiction vested

only by law. Consequently, where an assessee or a party before the Income Tax Officer or other authorities under the Act relies in support of his

claim on a will or for the matter of that on any other document, it is not obligatory on the authorities to accept these documents without any

enquiry. The authorities are bound to go into the question as to whether they should act upon the document produced before them. This will

necessarily imply an enquiry into the genuineness or otherwise of the document, if necessary. If a doubt arises as to the validity or the genuineness

of a document filed, for the limited purpose of a proceeding before the authority under the Income Tax Act, such authorities are bound to go into

the question of genuineness and validity. We must, therefore, hold that the observations made by the learned judge ousting the jurisdiction of the

Income Tax Department to go into the truth or otherwise of the genuineness of the will are not justified. It is, of course, open to the assessee to

challenge the view of the authorities with regard to the genuineness of a document, if the authorities come to a contrary conclusion in manner

permissible under the provisions of Income Tax Act.

Accordingly, the appeal is allowed to the extent indicated above. There will be no order as to costs.