The author, an eminent advocate, who is at the forefront of the crusade to resolve the core problems faced by the Tribunal, sees a ray of hope that the attitude of utter indifference shown so far by the Government towards the welfare of the Tribunal will change after the appointment of Shri. Kapil Sibal as the Law Minister. The author makes a fervent request to the Hon’ble Law Minster that he should spare time to immediately address those problems
Those who practice before the Income –tax Appellate Tribunal (the “ITAT”), are well aware that in the year 1996, the then Law Secretary issued a notification stating that the Ministry of Law has the power to transfer the Hon’ble Members of the ITAT. The said notification was challenged by the ITAT Bar Association, Mumbai, and the then President of the ITAT was made respondent to support the petition. The Hon’ble Bombay High Court stayed the operation of the said notification (Income-tax Appellate Tribunal Bar Association of India v. UOI, W.P. NO. 2350 of 1996 dt. 6-3-1997) (Income-tax Review, April 1997, P. 1 to 3).
this kind of conduct and that too on the part of the Law Secretary, who is expected to maintain the independence of the Income tax Appellate Tribunal and not to interfere with its judicial functioning, amounts to gross contempt of court
Though Mr. N. A. Palkhivala had stopped appearing before the Court, as the President of the ITAT Bar Association, he appeared before the then Chief Justice of the Bombay High Court in this matter. It seems that this was his last appearance before this Court. The matter was thereafter transferred to Hon’ble Supreme Court. The Hon’ble Supreme Court upheld the order of the Bombay High Court (AIFTPJ-January, 2004, P. 28 (T.P no. 6 of 1997dt 5-1-2004) [Ajay Gandhi v. B. Singh (2004) 265 ITR 451 (SC)]. As per the guidelines, the President, in consultation with the Senior Vice–President and Vice-Presidents, has the exclusive authority to transfer the Hon’ble Members from one place to another. When the matter was pending before the Apex Court, the then Law Secretary once again tried to interfere with the independent judicial functioning of the Hon’ble Members of the ITAT. A contempt proceeding was moved against him and he was held for contempt (Income-tax Appellate Tribunal v. V. K. Agarwal (1999) 235 ITR 175 (SC), (190). In this case, the Apex Court observed as follows:
“In our view this kind of conduct and that too on the part of the Law Secretary, who is expected to maintain the independence of the Income tax Appellate Tribunal and not to interfere with its judicial functioning, amounts to gross contempt of court. It is a deliberate attempt on his part to question the judicial functioning of the Tribunal coming as it does from a person of his rank. It is rightly perceived by the President as well as the two concerned members of the Tribunal as a threat to their independent functioning in the course of deciding appeals coming up before them.”
It is very unfortunate that the mother Tribunal has not been getting the deserved attention. From 3-6-2010 till date, the ITAT is being headed by an Officiating President. When a person is functioning as an Officiating President, he has certain limitations. He is always at the mercy of the officials in charge
The contribution of Shri Rajagopal Rao then President of ITAT and the ITAT Bar Association, Mumbai in preserving the independence of the ITAT, deserves to be written in golden words. It is very unfortunate that due to frequent changes at the helm of the Ministry of Law and Justice (the “Ministry of Law”), the mother Tribunal has not been getting the deserved attention. From 3-6-2010 till date, the ITAT is being headed by an Officiating President. When a person is functioning as an Officiating President, he has certain limitations. He is always at the mercy of the officials in charge. Now, the law has been amended in 2013. As per the new provision, the President can be appointed from amongst sitting or retired Judges who have completed atleast seven years of service as a High Court Judge or from amongst the Senior Vice-President or Vice-Presidents. It may be appreciated that it is the ITAT Bar Association which has made strong representations to the Standing Committee that the President should be from the amongst the Hon’ble Members. We are pleased to know that the Government has accepted the suggestion partly, wherein, as per the new provision, the President could be appointed from amongst the Senior President or Vice–Presidents.
We are happy to note that Hon’ble Shri Kapil Sibal, the incumbent Law Minister, is a well known lawyer. He has always championed the cause of independence of judicial institutions. We are therefore positive that he will strengthen the institution by actively interacting with the Bar and members of the ITAT for the better administration of justice. Various Bar Associations will soon be having an interactive meeting with him and would be discussing the following agenda:
(1) Early appointment of a permanent President of the ITAT;
(2) Process of appointment of Senior Vice–President and Vice–Presidents;
(3) A Judicial enquiry, headed by a sitting or a retired Judge or by the President of the ITAT, in the alleged involvement of the Hon’ble Members of ITAT whose orders were linked to the episode of the Calcutta Bench, within a period of three months;
(4) Viability of the proposal of an e-Bench of the Supreme Court linking it to various High Courts, on the lines similar to the e-Bench of the ITAT;
(5) Bold steps to maintain the independence of the ITAT;
(6) Increase in the age limit of the Hon’ble Members of the ITAT;
(7) Institutionalisation of the process of elevation of the Hon’ble Members of the ITAT to the office of a Judge of the High Court; and
(8) Modernisation, transparency and the use of technology for better administration of the justice delivery system.
The Federation has extended an invitation to Hon’ble Law Minister to address tax professionals at the National Convention to be held in the month of December at Mumbai. The ITAT Bar Association has also extended an invitation to the Hon’ble Law Minister to visit the ITAT to see the functioning of the e- Bench of the ITAT and to have an interactive discussion with the Bar and the Bench, on issues relating to better administration of justice.
We hope that the Hon’ble Law Minister will discuss all the above issues and will take a positive step in this regard. Those concerned with the ITAT may send their constructive suggestions to the Office of the Federation.
Dr. K. Shivaram
Editor-in-Chief, AIFTP Journal
Reproduced with permission from the AIFTP Journal, May 2013