Appeal to High Court – Territorial jurisdiction – Sections 116, 120, 124, 127, 260A and 269 of ITA, 1961 – Territorial jurisdiction of High Court is not governed by seat of the AO – Appeal would lie to High Court having jurisdiction over place where Tribunal which passed order is situated

Appeal to High Court – Territorial
jurisdiction – Sections 116, 120, 124, 127, 260A and 269 of ITA, 1961 –
Territorial jurisdiction of High Court is not governed by seat of the AO –
Appeal would lie to High Court having jurisdiction over place where Tribunal
which passed order is situated

In this case, the
Bangalore Bench of the Tribunal had passed an order on 30^th July,
2015. On 8^th September, 2015, an order was passed u/s 127 of the
Income-tax Act, 1961 transferring the respondent-assessee’s case from an
Assessing Officer (AO) at Bangalore to an AO at Pune. On the basis of the place
of the new AO, the Revenue filed an appeal against the order of the Tribunal in
the Bombay High Court. The assessee’s advocate raised a preliminary objection
about the maintainability of the appeal before the Bombay High Court.

The Bombay High
Court accepted the assessee’s plea and held as under:

‘(i)   A bare reading of sections 116, 120, 124,
127, 260A and 269 of the Income-tax Act, 1961 establishes that Chapter XIII of
the Act would be applicable only to the income-tax authorities under the Act as
listed out in section 116 thereof. Thus, it follows that the provisions of
sections 120, 124 and 127 of the Act will also apply only to the authorities
listed in section 116 of the Act. The Tribunal and the High Court are not
listed in section 116 of the Act as income-tax authorities under the Act.

(ii)   The jurisdiction of the court which will hear
appeals from the orders passed by the Tribunal would be governed by the
provisions of Chapter XX of the Act which is a specific provision dealing with
appeals, amongst others to the High Court. In particular, sections 260A and 269
of the Act when read together would mean that the High Court referred to in
section 260A of the Act will be the High Court as defined in section 269, i.e.,
in relation to any State, the High Court of that State. Therefore, the seat of
the Tribunal (in which State) would decide jurisdiction of the High Court to
which the appeal would lie under the Act.

(iii)   The High Court to which the appeal would lie
is not governed by the seat of the Assessing Officer. The words “all
proceedings under this Act” in section 127 have to be harmoniously read with
the other provisions of the Act and have to be restricted only to the
proceedings under the Act before the authorities listed in section 116 of the
Act. Thus, a harmonious reading of the various provisions of law would require
that the appeal from the order of the Tribunal is to be filed to the Court
which exercises jurisdiction over the seat of the Tribunal.

(iv)  Accordingly, the Bombay High Court did not
have jurisdiction to entertain appeals u/s 260A of the Act in respect of orders
dated 30^th July, 2015 passed by the Bangalore Bench of the
Tribunal.’