Reference to Court Under Person

Reference to Court Under Person

Reference to Court Under Person – Understanding the Income Tax Act

Under the Indian income tax law, when a person is dissatisfied with an order passed by the assessing officer, they have the right to file an appeal before the Commissioner of Income Tax (Appeals). If the individual is not satisfied with the order passed by the Commissioner of Income Tax (Appeals), they have the right to further appeal to the Income Tax Appellate Tribunal (ITAT). However, in certain situations, an individual may wish to make a reference to the court under person, seeking the court’s opinion on disputed questions of law arising from the order of the ITAT. This article will explore the concept of reference to court under person under the Indian income tax law.

Section 256 of the Income Tax Act, 1961 provides for the procedure of making a reference to the court under person. It states that either the assessee or the Commissioner of Income Tax can make an application to the ITAT for referring any question of law arising out of the ITAT’s order for the opinion of the High Court.

Conditions for making a reference

The application for making a reference to the court under person can be made on the following conditions:

  1. Substantial Question of Law: The reference to the court can only be made if the question of law is substantial in nature. It should be an important question of law that needs to be resolved for the proper adjudication of the case.

  2. Satisfaction of ITAT: The application for reference can only be made if the ITAT is satisfied that the case involves a substantial question of law.

Procedure for making a reference

The procedure for making a reference to the court under person is as follows:

  1. Filing of Application: The application for reference is to be made in writing to the ITAT. The application should clearly specify the question of law that needs to be referred to the High Court.

  2. Notice to the Parties: Once the application is made, the ITAT will provide notice to the parties involved in the appeal, i.e., the assessee and the Commissioner of Income Tax.

  3. Hearing: The ITAT will hear the application and the arguments of the parties before deciding whether to make a reference to the High Court.

  4. Formulation of Question: If the ITAT is satisfied that a substantial question of law is involved, it will formulate the question and refer the same to the High Court.

  5. Filing of Reference Application: The ITAT will refer the question of law along with its own findings on the matter to the High Court.

High Court’s opinion on the reference

Upon receipt of the reference from the ITAT, the High Court will hear the case and provide its opinion on the question of law referred to it. The High Court will consider the facts and circumstances of the case, relevant provisions of the Income Tax Act, and any applicable precedents before giving its opinion.

Conclusion

The process of making a reference to the court under person is an essential step in seeking the High Court’s opinion on significant questions of law that arise from an order of the ITAT. It provides an avenue for the resolution of complex legal issues that have a substantial bearing on the case. By following the prescribed procedure and satisfying the conditions laid down in the Income Tax Act, an individual can effectively seek the High Court’s opinion for resolving contentious legal matters arising in income tax appeals.

Disclaimer:
The Bar Council of India does not permit the solicitation of work and advertising by legal practitioners and advocates. By accessing The Law Codes website, the user acknowledges that:The user wishes to gain more information about us for his or her information and use.He/She also acknowledges that there has been no attempt by us to advertise or solicit work. Any information obtained or downloaded by the user from our website does not lead to the creation of the client-attorney relationship between our office and the user. None of the information contained on our website amounts to any form of legal opinion or legal advice. All information contained on our website is the intellectual property of the office.