Law: Income Tax Act, 1922

Section: 245D(4),245

(a) Income-tax-----Settlement Commission---Finality of orders---No bar to writ jurisdiction of High Court or special leave jurisdiction of Supreme Court---Scope of judicial review---Restricted to considering whether order is contrary to any provision of Income Tax Act, apart from bias, fraud or malice---Trust deed ---Wrong interpretation by Commission---No ground for interference---Indian Income Tax Act, 1961, Ss.245-D(4) & 245-I---Constitution of India, Arts. 32, 136 & 226. The finality clause contained in section 245-I of the Income Tax Act, 1961, in relation to orders of the Settlement Commission under section 245-D(4), does not and cannot bar the jurisdiction of High Courts under Article 226 of the Constitution of India or the jurisdiction of the Supreme Court under Article 32 or under Article 136, as the case may be. But that does not mean that the jurisdiction of the Supreme Court in an appeal preferred directly in that Court would be any different from what. It would be if the assessee had first approached the High Court under Article 226 and then came up in appeal under Article 136. A party does not and cannot gain any advantage by approaching the Supreme Court directly under Article 136, instead of approaching the High Court under Article 226. This is not a limitation inherent in Article 136; it is a limitation which the Supreme Court imposes on itself having regard to the nature of the function performed by the Commission and keeping in view the principles of judicial review. The scope of the enquiry whether by the High Court under Article 226 or before the Supreme Court in the appeal under Article 136 remains the same, viz., to consider whether the order of the Settlement Commission is contrary to the provisions of the Income Tax Act, and if so whether it has prejudiced the petitioner. This is, of course, apart from grounds of bias, fraud and malice which constitute a separate and independent category. Shreeram Durga Prasad and Fatechand Nursing Das v. Settlement Commission (I.T. and W.T.) (1989) 176 ITR 169 (SC) rel. Where, in a case before the Settlement Commission, the Commission has to interpret a trust deed, even if the interpretation…

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