The Income Tax Appellate Tribunal was set up on 25th January, 1941 as an independent quasi-judicial body to hear Second Appeals under the Income-tax and Wealth Tax Act. The Tribunal was constituted with three Benches with its headquarters at Bombay now Mumbai. With the increase in litigation and in accordance with the motto “Sulabh Nyay Satvar Nyay” Benches increased to 63. Criteria for its working is ‘(i) Cost effective; (ii) Accessibility; (iii) Freedom from technicalities; (iv) Expedition; and (v) An expert knowledge of the subject.’
Levy and collection of tax on the principles enshrined under Article 265 of the Constitution of India, in the largest Democracy of the work, is a formidable task. The Assessing Authority, prefers to frame high pitched assessment. The First Appellate Authority prefers to uphold the view expressed by the Assessing Authority. Lis starts at the level of the Second Appeal before the Tribunal. The Appellate Tribunal shall consist of a Judicial Member and an Accountant Member. It provides healthy atmosphere to interact and co-exist.
Strict norms have been laid down for selection, promotion and elevation. One must be of high integrity, honesty and required to have a moral vigour, ethical firmness and impervious to corrupt or venial influences. One should be competent enough to keep most exacting standards of propriety in Judicial conduct. Well defined strict procedure has been evolved so that right person, at right time, in right manner enters the Tribunal. In ‘Shukraneetisar’ the great jurist Shukra says “The judges appointed by the King should be well-versed in procedure, be wise, of good character and temperament, soft in words, impartial to friend or foe, truthful, learned in law, active (not lazy) free from anger, greed or desire (for personal gain)”. Function of a judicial authority is a divine function. The greatest strength is the faith and trust of the citizens. It should not be shaken and one should not be under cloud.
Over years it has applause from the judiciary, taxpayers and the tax department. So much so that it is called as a “model” or “mother” Tribunal. The Appellate Tribunal is final fact finding authority. Its finding on facts is final and no appeal lies to the Hon’ble High Court, except on substantial question of law. The powers are very wide but there is no power of enhancement. All questions, whether of law or a fact which relate to the assessment of an assessee may be raised before the Tribunal. The powers include the power to annul an assessment order or set aside or remand. The powers have been expressed in the widest possible terms. It has power to grant stay and rectify its own order, with no right to review.
Its functioning has been applauded by the Supreme Court and those who matter. Smt. Indira Gandhi, iron lady and most powerful Prime Minister in 1981, stated: “The Income Tax Appellate Tribunal with its branches spread all over the country has an important role. It has to preserve the interests of revenues to the State, to prevent harassment to the taxpayers and to render better service and quicker justice to the citizen and the State alike”. Illustrious former Prime Minister, Shri Rajiv Gandhi appreciated on 4-3-1985 “Over the years, tax laws have grown in complexity and with it has grown the need for fair and dispassionate interpretation of the laws. The Income Tax Appellate Tribunal has made a useful contribution in this field.” Hon’ble Mr. Justice Y. V. Chandrachud, Former Chief Justice of India on July 15, 1981 observed – ‘The Income Tax Appellate Tribunal is a model administrative Tribunal whose illustrious example and commendable performance may well be emulated by similar other Tribunals in different disciplines. There is uniform praise of the manner in which the Tribunal functions and I suppose it is one of the few quasi-legal institutions which is not plagued by the problem of arrears.” Its decisions are analytical thrashing out the facts and the law and many landmark orders have been passed. Above 90% whereof are approved by the Apex Court. Its decisions are referred to and respected outside India as well.
With vast experience of 10-15 years, the Accountant Member have to satisfy with attaining age of superannuation at 62. However the Judicial Members deserve to be elevated as Hon’ble Judges of the High Courts. Hon’ble Mr. Justice Ranganathan, former President adorned the high office of honourable judge of the Apex Court, whereas Justice T. D. Sugla, Justice R. V. Easwar and many other judicial members have been elevated to the High Courts and have proved as an asset in tax benches. It is highly desirable that competent members of integrity are elevated in the High Courts, sit in tax benches and dispose of tax matters expeditiously, accurately and with strength. Age also deserves to be enhanced to 65, looking to the lifespan these years.
I have pleasure and privilege of appearance before the prestigeous institution since 1954 in Delhi benches, which were functioning in barracks. I have appeared in fairly large number of benches all over the Country. I cherished the appearance and the atmosphere as Shri N. A. Palkhivala, doyen of our profession, use to enjoy appearance. Members used to be courteous, humorous and used to treat with smile at the same level. We used to live like a Joint Hindu Family, respecting and loving each other and learning from and teaching to one another. Mr. Sehgal, a senior Judicial Member of I.T.A.T., Delhi Benches, when I stood up to argue on application for rectification in 1977 stated : “Mr. Ranka, on Friday we sit to hear about our mistakes and try to understand view point of both the sides in a critical manner”. In recent years the members do not appreciate filing of Rectification Applications and try to reject in a mechanical manner. There had been a sea change in the attitude of the members of a prestigeous institution of ITAT.
The Hon’ble Members are expected to be just fair, reasonable and to give fair opportunity for hearing to both the sides, and write detailed, well nit, reasoned, speaking orders, considering the facts and judicial precedents. Atmosphere should be congenial and younger generation needs encouragement.
Time has come when we have to bring back the old glory by strengthening the co-ordination and harmonisation between the Bar and the Bench and perform the divine act of delivering justice with the help of harnessing our extraordinary ability by adopting and practicing in day-to-day life the attributes possessed in our judicial heritage and culture. I have all the hopes that the I.T.A.T., shall be a better arbiter of justice, without technicalities and with expedition, to have a great impact on the erring tax authorities. My best wishes and congratulations on the Platinum Jubilee Celebrations.
[Source : Article printed in ITAT Platinum Jubilee Celebration souvenir held on 24th & 25th January, 2016 at New Delhi]