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PETITIONER:

K.S. RASHID AND SON

Vs.

RESPONDENT:

THE INCOME-TAX INVESTIGATION COMMISSION, ETC.(With connecte

DATE OF JUDGMENT:

22/01/1954

BENCH:

MUKHERJEA, B.K.

BENCH:

MUKHERJEA, B.K.

HASAN, GHULAM

MAHAJAN, MEHAR CHAND (CJ)

DAS, SUDHI RANJAN

BOSE, VIVIAN

CITATION:

1954 AIR 207 1954 SCR 738

CITATOR INFO :

F 1956 SC 246 (23)

R 1957 SC 882 (6)

F 1959 SC 881 (6)

AFR 1961 SC 532 (3,9,14,24,36,47)

RF 1961 SC1506 (9)

ACT:

constitution of India, art. 226--Jurisdiction of

Punjab High Court to issue writs to Income-tax Investigation

Commission located in Delhi--Remedy under art.

226--Discretionary--Taxation on Income (Investigation

Commission) (Act XXX of 1947), ss. 5 and 8(5).

HEADNOTE:

The Punjab High Court has jurisdiction to issue a writ

under art. 226 of the Constitution to the Income-tax

Investigation Commission located in Delhi and

investigating the case of the petitioner under 5 of the

Taxation on Income (Investigation Commission) Act, 1947,

although the petitioners were assessees within the U.P.

State and their original assessments were made by the

Income-tax authorities of that State.

Article 226 of the Constitution confers on all the

High Courts new and very wide powers in the matter of

issuing writs which they never possessed before. There are

only two limitations placed upon the exercise of such

powers by a High Court; one is that the power is to be

exercised "throughout the territories in relation to which

it exercises jurisdiction", that is to say, the writs

issued by the court cannot run beyond the territories

subject to its jurisdiction. The other is that the

person or authority to whom

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the High Court is empowered to issue writs "must be within

those territories" and this ,implies that they must be

amenable to its jurisdiction either by residence or location

within those territories.

The remedy provided in art. 226 of the Constitution is

a discretionary one and the High Court has always the

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discretion to refuse to grant any writ if it is satisfied

that the aggrieved party can have an adequate or suitable

relief elsewhere.

Ryots of Garabandho v. Zamindar of Parlakimedi (70 I.A.

129) and Election Commission v; Saka Venkata Subba Rao

[1953] S.C.R. 1144 referred to.

JUDGMENT:

CIVIL APPELLATE JURISDICTION: CIVIL APPEALS Nos.

118 to 121 of 1952.

(Appeals under article 133 (1) (c) of the Constitution

of India from the Judgment and Order dated the 10th

August, 1950, of the High Court of Judicature, Punjab at

Simla (Khosla and Kapur JJ.) in Civil Miscellaneous Nos.

256, 260, 261 and 262 of 1950).

Dr. Balkshi Tek Chand (T. N. Sethi, with him) for the

appellants.

M.C. Setalvad, Attorney-General for India (Porus A.

Mehta, with him) for the respondents.

1954. January, 22. The Judgment of the Court was

delivered by

MUKHERJEA J.--These four consolidated appeals, which

have come before us, on a certificate granted by the High

Court of Punjab under article 133 (1)(c)of the

Constitution, are directed against one common judgment

of a Division Bench of that court dated the 10th August,

1950, by which the learned Judges dismissed four

analogous petitions, presented on behalf of the

different appellants, claiming reliefs under articles

226 and 227 of the Constitution, in respect of certain

income-tax investigation proceedings commenced

against them under Act XXX of 1947. It appears that a

partnership firm carrying on business under the name and

style of K.S. Rashid & Son was started on the 5th of May,

1934, the partners being three in number to wit K.S.

Rashid Ahmed, Saeed Ahmed, his son, and Mrs. Zafar

Muhammed, his mother Mrs. Zafar Muhammed died on the 7th

of January, 1946, and as a result of her death the

partnership stood dissolved. Immediately on the day

following,

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that is to say on the 8th of January, 1946, a new firm was

started bearing the same name, with the two surviving

partners of the original firm and one Saeeda Begum, a

daughter of K.S. Rashid, as the third partner. On the

31st of December, 71947, the Central Government referred

the cases of this firm, as well as of the individuals

constituting it, to the Income-taxInvestigation Commission

for enquiry and report under section 5of Act XXX of 1947,

presumably on the ground that there had been substantial

evasion of payment of income-tax in these cases. The

authorised official appointed under section 5 (4)(3) of the

Act, who figures as respondent No. 2 in all these appeals,

in due course started investigation in these cases and the

appellants' complaint is, that contrary to the

provisions of the Act, he extended his investigations to a

period subsequent to the 31st March, 1943, up to

which date the income-tax assessment in all these cases was

completed. A petition embodying this complaint was made

-to the authorised official on the 8th of April, 1949, but

no order was passed on the petition, as the Commission was

expecting an early change of law in this respect. The law

was amended by an Ordinance dated the 5th of July, 1949, but

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the appellants still contended that the amendment was

neither retrospective in its operation, nor did it enable

the authorised official to carry on his investigation

beyond the 31st March, 1943. The account books, however,

were shown to the official under protest. On the 17th

September, 1949, three applications were filed before the

Commission, one with regard to the affairs of Mrs.

Zafar Muhammed stating that no investigation could take

place in regard to her as she was already dead;the second

with regard to the affairs of Saeeda Begum on the ground

that she being a new partner and not having been assessed

before, was not subject to 'the jurisdiction of the

Commission; while the third application was to the

effect that the new firm, which came into existence on the

8th of January, 1946, could not have its affairs enquired

into at all under the provisions of the Act. After that,

in June, 1950, four miscellaneous petitions were filed,

(being C.M. Gases Nos. 259 to 262

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of 1950) on behalf of the appellants, before the High Court

of Punjab, and the prayers made therein were of a three-

fold character. It was prayed in the first place that

a writ of prohibition might be issued to the Commission and

the authorised official directing them not to proceed with

the investigation of cases referred to the Commission under

section 5 of Act XXX of 1947. The second prayer was for a

writ in the nature of certiorari for quashing the

proceedings already commenced. The third and the

alternative claim was that the proceedings before the

Commission might be revised under article 277 of the

Constitution and suitable orders passed as the justice of

the case would require. Upon these petitions, rules were

issued on the 25th of July, 1950, after a report from

the Investigation Commission had been called for. On

behalf of the respondents, who resisted these petitions,

certain preliminary points were raised in bar of the

petitioners" claim. It was contended in the first

place that the petitioners being assessees belonging to

U.P., their assessments were to be made by the

Income-tax Commissioner of that State and the mere fact that

the location of the Investigation Commission was in Delhi

would not confer jurisdiction upon the Punjab High

Court to issue writs under article 226 of the

Constitution. The second objection was that the Act

itself being of a special nature which created new rights

and liabilities, the remedies provided for in the Act

itself for any breach or violation thereof were the only

remedies which could be pursued by the aggrieved parties and

article 226 or 227 of the Constitution would not be

available to the petitioners. The third ground taken

was that the court could not give relief to the petitioners

because of sections 5(3) and 9 of Act XXX of 1947. These

contentions found favour with the learned Judges who heard

the petitions, and although they did not express any final

opinion on the third point raised they dismissed the

applications of the petitioners on the first two grounds

mentioned above. It is against these orders of dismissal

that the present appeals have been taken to this court and

Dr. Tek Chand, who appeared on behalf of the appellants, has

assailed the

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propriety of the decision of the High Court both the

points.

So far as the first, point is concerned, which relates

to the question of jurisdiction of the Punjab High

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Court to issue writs of certiorari or prohibition in

these cases, the learned Judges based their decision

entirely upon the pronouncement of the Judicial Committee in

the well known case of Ryots of Garabandho v.' Zamindar of

Parlakitnedi(1). The question for consideration in that

case was, whether the High Court of Madras had jurisdiction

to issue a writ of certiorari in respect of an order passed

by the Collective Board of Revenue, as an appellate

authority, in certain proceedings for settlement of rent

between the Zamindar of Parlakimedi and the Ryots of

certain villages within his estate situated in the

district of Ganjam which was wholly outside the limits of

the Presidency town of Madras. The question was answered in

the negative. The Judicial Committee laid down that the

three Chartered High Courts of Calcutta, Madras and Bombay

had powers to issue, what were known as the high prerogative

writs, as successors to the Supreme Courts which

previously exercised jurisdiction over these Presidency

Towns; but the exercise of the powers under the Charter

was limited to persons within the ordinary original

civil jurisdiction of the three High Courts, and outside

that jurisdiction it extended only to 'British subjects'

as defined in the Charter itself. It was held that the

Supreme Court of Madras had no jurisdiction under the

Charter which created it to correct or control a country

court of the the East India Company deciding a dispute

between Indian inhabitants of the Ganjam district about

the rent payable for land in that district; and no such

power was given by any subsequent legislation to its

successor, the High Court . A contention seems to have

been raised on behalf of the appellants that the

jurisdiction to issue writs could be rounded on the fact

that the office of the Board of Revenue, which was the

appellate authority in the matter of settlement of

rents, was located within the town of Madras

(1) 70 I.A. 129.

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and the order complained of was made in that town and

reliance was placed in this connection upon the case of

Nundo Lal Bose v. The Calcutta Corporation (1), where a

certiorari was issued by the Calcutta High Court to quash an

assessment made by the Commissioners of the town of Calcutta

on a certain dwelling house. This contention was repelled by

the Judicial 'Committee with the following observations:

"The question is whether the principle of that case

can be applied in the present case to the settlement of

rent for land in Ganjam, merely on the basis of the

location of the Board of Revenue, as a body which is

ordinarily resident or located within the town of

Madras, or on the basis that the order complained of was

made within the town. If so, it would seem to follow that

the jurisdiction of the High Court would be avoided by the

removal of the Board of Revenue beyond the outskirts

of the town, and that it would never attach but for the

circumstance that an appeal is brought to, or

proceedings in revision taken by, the Board of Revenue.

Their Lordships think that the question of jurisdiction

must be regarded as one of substance, and that it

would not have been within the competence of the

Supreme Court to claim jurisdiction over such a matter as

the present by issuing certiorari to the Board of Revenue

on the strength of its location in the town. Such a view

would give jurisdiction to the Supreme Court, in the

matter of the settlement of rents for ryoti holdings in

Ganjam between parties not otherwise subject to its

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jurisdiction, which it would not have had over the

Revenue Officer who dealt with the matter at first

instance."

It is on the basis of these observations of the Judicial

Committee that the learned Judges have held that the

mere location of the Investigation Commission in Delhi is

not sufficient to confer jurisdiction upon the Punjab

High Court to issue a writ in the present case. It is

said that the petitioners are assessees within the U. P

State and their original assessments were made by the

Income-tax Officers of that State.

(1)I.L.R. II Cal. 275

744

The subsequent proceedings, which had to be taken in

pursuance of the report of the Investigation Commission,

would have to b.e taken by the Income-tax authorities

in the U.P., and if a case had to be stated, it would be

stated to the High Court at Allahabad. Taking, therefore, as

the Privy Council had said, that, the question of

jurisdiction is one of substance, it was held that no

jurisdiction in the present case could be vested in the

Punjab High Court, for that jurisdiction could be avoided

simply by removal of the Commission from Delhi to another

place.

This line of reasoning does not appear to us to be

proper and we do not think that the decision in the

Parlakimedi's case(1) is really of assistance in

determining the question of jurisdiction of the High Courts

in the matter of issuing writs under article 226 of the

Constitution. The whole law on this subject has been

discussed and elucidated by this court in its recent

pronouncement in Election Commission v. Venkata Rao(2

) where the observations of the Judicial Committee in

Parlakimedi's case, upon which reliance has been placed by

the Punjab High Court, have been fully explained. It is

to be noted first of all, that prior to the commencement

of the Constitution the powers of issuing prerogative

writs could be exercised in India only by the High

Courts of Calcutta,, Madras and Bombay and that also

within very rigid and defined limits. The writs could

be issued only to the extent that the power in that

respect was not taken away 'by the Codes of Civil and

Criminal Procedure(3) and they could be directed only

to persons and authorities within the original civil

jurisdiction of these High Courts. The Constitution

introduced a fundamental change of law in this respect.

As has been explained by this Court in the case referred

to above, while article 225 of the Constitution

preserves to the existing High Courts the powers and

jurisdictions which they had previously, article 226

confers, on all the High Courts, new and very wide powers

(1) 70 I.A. 139.

(1) [1953] S.C.R. 1144.

(3) Vide in this connection Besant v. Tire Advocate General

of Madras. 46 I.A. 176.

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in the matter of issuing writs which they never

possessed before. "The makers of the

Constitution" thus observed Patanjali Sastri C.J.

in delivering the judgment of the court, "having

decided to provide for certain basic safeguards for the

people in the new set up, which they called fundamental

rights, evidently thought it necessary to provide also a

quick and inexpensive remedy for the enforcement of such

rights, and, finding that the prerogative writs, which the

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courts in England had developed and used whenever urgent

necessity demanded immediate and decisive interposition,

were peculiarly suited for the purpose, they conferred,

in the State's sphere, new and wide powers on the

High Courts of issuing directions, orders, or writs

primarily for the enforcement of fundamental rights, the

power to issue such directions, etc. 'for any other

purpose' being also included with a view apparently to

place all the High Courts in this country in somewhat the

same position as the Court of King's Bench in

England." There are only two limitations placed upon the

exercise of these powers by a High Court under article 226

of the Constitution; one is that-the power is to

be exercised "throughout the territories in relation

to which it exercises jurisdiction", that is to say,

the writs issued' by the court cannot run beyond

the territories subject to its jurisdiction.

The other limitation is that the person or authority to

whom the High COurt is empowered to issue writs "must be

within those territories" and this implies that they must

be amenable to its jurisdiction either by residence or

location within those territories. It is with reference to

these two conditions thus mentioned that the jurisdiction of

the High Courts to issue writs under article 226 of the

Constitution is to be determined. The observations of

the Judicial Committee in Parlakimedi's case(1) have

strictly speaking no direct bearing on the point. It is

true as the Privy Council said in that case that the

question of jurisdiction must be regarded as one of

substance, but the meaning and implication of this

observation could be ascertained only with

reference to the context of

(1) 701. A. 129.

11--95 S.C. 1./59

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the facts and circumstances of that case. As was

pointed out by this court in the case referred to

above(1): "Their Lordships considered, in the peculiar

situation they were dealing with, that the mere

location of the appellate authority alone in the town of

Madras was not a sufficient basis for the exercise of

jurisdiction whereas both the subject matter, viz., the

settlement of rent for lands in Ganjam, and the Revenue

Officer authorised to make the settlement at first instance

were outside the local limits of the jurisdiction of the

High Court. If the Court in Madras were recognised as

having jurisdiction to issue the writ of certiorari to the

appellate authority in Madras, it would practically be

recognising the court's jurisdiction over the Revenue

Officer in Ganjam and the settlement of rents for lands

there, which their Lordships held it never had. That was

the 'substance' of the matter they were looking at." In

our opinion, therefore, the first contention raised by Dr.

Tek Chand must be accepted as sound and the view taken by

the Punjab High Court on the question of jurisdiction

cannot be sustained.

So far as the second point is concerned, the High Court

relies upon the ordinary rule of construction that

where the legislature has passed a new statute giving a new

remedy, that remedy is the only one which .could be

pursued. It is said that the Taxation on Income

(Investigation Commission) Act, 1947, itself provides a

remedy against any wrong or' illegal order of the

Investigating Commission and under section 8 (5) of the Act,

the aggrieved party can apply to the appropriate

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Commissioner of Income-tax to refer to the High Court

any question of law arising out of such .order and

thereupon the provisions of sections 66 and and 66-A of the

Indian Income-tax Act shall apply with this modification

that the reference shall be heard by a Bench of not less

than three Judges of the High Court. We think that it is not

necessary for us to express any final opinion in this case

as to whether section 8 (5) of the Act is to be regarded

as providing the only remedy available to the aggrieved

party and that it excludes altogether the remedy

provided for

(1) A.I.R. z953 S.C. 310, 214; [1953] S.C.R. 1144.

747

under article 226 of the Constitution. For purposes of this

case it is enough to state- that the remedy provided for in

article 226 of the Constitution is a discretionary remedy

and the High Court has always the discretion to refuse to

grant any writ if it is satisfied that the aggrieved party

can have an adequate or suitable relief elsewhere. So

far as the present case is concerned, it has been brought to

our notice that the appellants before us have already

availed themselves of the remedy provided for in section

8(5) of the Investigation Commission Act and that a

reference has been made to the High Court of Allahabad in

terms of that provision which is awaiting decision. In

these circumstances, we think that it would not be proper

to allow the appellants to invoke the discretionary

jurisdiction under article 226 of the Constitution at the

present stage, and on this ground alone, we would refuse to

interfere with the orders made by the High Court. Dr. Tek

Chand argues that the Income-tax authorities have not

referred all the matters to the High Court which the

appellants wanted them to do. But for this there is a

remedy provided in the Act itself and in case a proceeding

occasions a gross miscarriage of justice, there is always

the jurisdiction in this court to interfere by way of

special leave. In the result, we dismiss the appeals

but in the circumstances of the case make no order as to

costs. '

Appeals dismissed.

Agent for the appellant: Rajinder Narain.

Agent for the respondents: R.H. Dhebar.

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