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Bh. Satyanarayanamurthi v. Income-Tax Appellate Tribunal Madras-Bench B .
Factual and Procedural Background
This opinion concerns an application under Section 66(2) of the Income-tax Act seeking a direction to the Income-tax Appellate Tribunal, Madras, to state a case and refer questions of law to the High Court. The Tribunal had dismissed the applicant's application under Section 66(1) of the Indian Income-tax Act on the ground that the application must be signed by the applicant himself, and an agent was not empowered to sign on his behalf. The Tribunal also questioned whether the agent who signed was duly authorised by the assessee to represent him before the Tribunal.
Legal Issues Presented
- Whether an application under Section 66(1) of the Indian Income-tax Act must be signed by the applicant personally or if an authorised representative may sign it.
- Whether the person who signed the application, claiming to be the agent of the assessee, was duly authorised in writing to represent the assessee before the Income-tax Appellate Tribunal.
- Whether the power-of-attorney granted by the assessee to his agent included authority to appear before the Income-tax Appellate Tribunal, considering the Tribunal is not a Court within the ordinary or legal meaning.
Arguments of the Parties
Applicant's Arguments
- The agent who signed the application is the clerk of the assessee and thus qualifies as a person regularly employed by the assessee under Section 61(1) of the Income-tax Act.
- The agent was authorised by a general power-of-attorney to represent the assessee in various Courts and authorities, which the applicant contended included representation before the Income-tax Appellate Tribunal.
Respondent's Arguments
- The application must be signed by the applicant himself as per the rules; an agent cannot sign on behalf of the principal unless duly authorised.
- The power-of-attorney granted did not explicitly authorise representation before the Income-tax Appellate Tribunal, which is not a Court in the strict legal sense.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Subbartmaniun Chettiar v. Commissioner of Income-tax, 1953-24 ITR 89 (AIR 1954 Mad 91) | Whether an application under Section 66(1) must be signed by the applicant or can be signed by an authorised representative. | The Division Bench held that either the applicant or the authorised representative's signature suffices; two signatures are not necessary. The court followed this binding precedent. |
| R.M. Seshadri v. Second Additional Income-Tax Officer, 1954-25 ITR 400 (AIR 1954 Mad 806) | Whether the Income-tax Appellate Tribunal is a Court within the meaning of the power-of-attorney. | The Division Bench held that the Income-tax Appellate Tribunal is not a Court. The present court relied on this to interpret the scope of the power-of-attorney strictly. |
Court's Reasoning and Analysis
The Court began by examining the statutory and regulatory framework governing the signing of applications under the Income-tax Act and the Appellate Tribunal Rules. It relied on Rule 22-A, which prescribes the form and signature requirements for applications requesting the Tribunal to refer questions of law to the High Court.
The Court applied the binding precedent from Subbartmaniun Chettiar v. Commissioner of Income-tax, which clarified that either the applicant or an authorised representative may sign the application; both signatures are not necessary.
Next, the Court considered whether the person who signed the application was an authorised representative. Rule 2(ii) defines an authorised representative as a person duly authorised in writing under Section 61 of the Income-tax Act. Section 61(1) permits an assessee to authorise a relative, employee, lawyer, accountant, or Income-tax Practitioner in writing.
The person who signed, Gunnavadhanulu, was the assessee's clerk. The critical question was whether he was authorised in writing to represent the assessee before the Tribunal. The assessee relied on a general power-of-attorney, which authorised representation in various Courts and authorities but did not explicitly mention the Income-tax Appellate Tribunal.
The Court strictly construed the power-of-attorney, noting that the assessee distinguished between Courts and other authorities and limited Courts to Civil, Criminal, and Revenue Courts. The Court referenced R.M. Seshadri, which held that the Income-tax Appellate Tribunal is not a Court in the legal sense.
Given this, the Court concluded that the general power-of-attorney did not authorise representation before the Income-tax Appellate Tribunal. Since the agent was not duly authorised in writing, the application was improperly signed.
Holding and Implications
The Court dismissed the application.
The direct effect is that the application under Section 66(2) to direct the Tribunal to state a case was refused because the application was not signed by a duly authorised person. The Court did not impose costs on the applicant despite dismissing the petition. No new precedent was established; the Court applied existing binding decisions and statutory interpretation principles.
Subba Rao, C.J:— This is an application under Section 66(2) of the Income-tax Act to direct the Income-tax Appellate Tribunal, Madras, to state a case and refer the questions of law to this Court. The tribunal dismissed the application filed by the applicant under Section 66(1) of the Indian Income-tax Act on the ground that, under the rules, the application must be signed by the applicant and that the agent is not empowered to sign on behalf of the principal. The Tribunal was also inclined to hold that the agent, who signed the application, was not duly authorised by the assessee to take proceedings before the Income-tax Appellate Tribunal.
2. Rule 22-A of the rules framed under the Indian Income-tax Act governs the situation. It reads:
“An application under sub-s. (1) of S. 66 requiring the Tribunal to refer to the High Court any question of law shall be in the following form:
The said form after giving the particulars necessary to be filled up by the applicant, indicates that it should be signed in the following manner:
Signed.
(Applicant)
Signed.
authorised representative, if any;”.
3. A Division Bench of the Madras High Court in Subbartmaniun Chettiar v. Commissioner of Income-tax, 1953-24 ITR 89 : (AIR 1954 Mad 91 (A)), considered the question, whether both the applicant and the authorised representative should have signed, or, it would meet the requirements of law if one of them had signed it. Dealing with that question, Satyanarayana Rao J., who delivered the judgment, observed at p. 92 (of ITR): (at p. 92 of AIR), thus:
“We do not see any necessity for two signatures, and in the context, the form must be read as only laying down that either it should be signed by the assessee or at least by his authorised representative if he had one. If the authorised representative signs on the application, there is no point in insisting upon the signature of the assessee also. All that the law requires is that there must be the signature of either the principal or his authorised representative, and the application must be presented under R. 7 of the Appellate Tribunal Rules……”
4. The decision being that of a Division Bench of the Madras High Court delivered before 5th July, 1954, is binding on us. That apart, we respectfully agree with the observations quoted above.
5. The next question is whether the authorised representative of the assessee signed the application filed before the Tribunal. One J. Gunnavadhanulu, claiming to be the agent of the assessee signed the application filed before the Tribunal. Rule 2(ii) of the Appellate Tribunal Rules, 1946 defines ‘authorised representative’ as meaning “in relation to an assessee a person duly authorised by the assessee under S. 61 to attend before the Tribunal”. The material portion of S. 61(1) referred to in the rule says:
“Any assessee, … may attend by a person authorised by him in writing in this behalf, being a relative of or a person regularly employed by the assessee, or a lawyer or accountant or Income-tax Practitioner, and not being disqualified by or under sub-s. (3).”
6. It is said that Gunnavadhanulu is the clerk of the assessee and, therefore, he satisfies the second qualification laid down in the section. The only question, therefore, is whether he is a person authorised by the assessee in writing in this behalf. The assessee relies upon the general power-of-attorney given by him to Gunnavadhanulu in support of his contention that he is the person authorised by him in writing to attend to his business before the Income-tax Appellate Tribunal. As the argument turns upon the recitals in the said power-of-attorney, it will be convenient to read the same.
“Know all men by these presents … to appear for and represent me in all Courts, Civil, Criminal, Revenue, Regional Transport Authority, Rajahmundry Central Road Traffic Board, Madras — District Superintendent of Police Offices — The District Forest Officer, Vizagapatam and to appoint lawyers to represent me in all the above Courts and to sign such vakalats on my behalf in respect of the operation of all my stage carriages and other Motor Vehicles and other forest business. His statements and explanations in respect of the above shall be rained and confirmed by me.”
7. it is a well-settled principle that a power-of-attorney should be strictly construed. The short question is, whether the assessee intended to include the Income-tax Tribunal within the meaning of the words “Courts, Civil, Criminal, Revenue”. A Division Bench of the Madras High Court in R.M. Seshadri v. Second Additional Income-Tax Officer, 1954-25 ITR 400 : (AIR 1954 Mad 806 (B)), held that the Income-tax Appellate Tribunal constituted under the Indian Income-tax Act is not a Court. Notwithstanding that judgment, we would have held, if the context permitted, that the assessee used the word in a more comprehensive sense than that word legally conveys.
8. But the assessee in the power-of-attorney makes a distinction between Courts and other authorities and, in the operative portion, he authorised separately the attorney to represent him in Courts and to sign the necessary ??? before the authorities. It is, therefore, reasonable to assume that the assessee, when lie used the word ‘Courts' used it in its ordinary sense rather than in a loose way. That apart, he also qualified the word ‘Courts' by confining them only to Civil, Criminal, and Revenue Courts. In either ordinary parlance or legal sense the Income-tax Appellate Tribunal cannot be held to be a Civil, Criminal or a Revenue Court. It also appears that, this is the first occasion for the applicant to take any proceeding before the Income-tax Authorities, or, at any rate, before the Income-tax Appellate Tribunal. It is more likely, therefore, that, at the time he gave the power-of-attorney, it was not in his contemplation that the attorney would have to attend the Income-tax Tribunals. In this context, it is apparent and indeed manifest that the applicant did not intend to authorise the attorney to act for him before the Income-tax Appellate Tribunal. Nor could we hold that the words used by him were of sufficient amplitude to take in Tribunals which are not Courts.
9. In this view, though the result is unfortunate. We dismiss the application, but, in the circumstances, without costs. Writ Petition No. 193 of 1957 is also dismissed.
V.S.B
10. Application dismissed.
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