Law: Income Tax Act, 1961

Section: 256(1),(2)

Writ---Alternative remedy---Scheme of remedies provided under Income-tax Act against order of Tribunal---Writ Petition challenging validity of order of Tribunal cannot be entertained---That assessee can obtain interim order in writ jurisdiction is not a ground for entertaining writ petition--¬Contention that Tribunal failed to follow of High Court---Tribunal considered decision of High Court and distinguished it---Writ petition not maintainable---Indian Income Tax Act, 1961, S.256(1), (2)---Constitution of India, Art.226. For the assessment years 1991-92 and 1992-93, the dividends received by the petitioner were added as income without allowing the deduction claimed by the petitioner. The Commissioner of Income-tax (Appeals) dismissed the appeals filed by the petitioner. The Tribunal also dismissed the appeals filed by the assessee before it. On a writ petition, the petitioner contended that the Tribunal failed to follow the of the jurisdictional High Court in CIT v. Kovur Textiles & Co. (1982) 136 ITR 61 (AP) and, therefore, it had committed gross illegality which could be challenged in a writ petition under Article 226 of the Constitution and also that in a case of reference, the petitioner could not claim stay of recovery of tax from the High Court: Held, (i) that the contention of the petitioner could not be acceded to, firstly, because the of the High Court in CIT v. Kovur Textiles (1982) 136 ITR 61 (AP) was considered by the Tribunal and distinguished by it and secondly, because the scheme of the Income-tax Act provides for a reference to-the High Court under section 256(1) of the Income Tax Act, 1961, at the instance of the assessee as well as at the instance of the Revenue. An opportunity is given to the assessee to file an application before the Tribunal requesting the Tribunal to state the case and refer the questions of law raised before it. If the Tribunal agrees that any question of law arises from the of the Tribunal, it has to refer the same to the High Court. But if the Tribunal feels that no question of law arises from the order of the Tribunal, it can reject the application. As against the order of rejection by the Tribunal, the assessee…

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