# COMMISSIONER OF INCOME-TAX (CENTRAL), NEW DELID v. M/S. S. ZORASTER & COMPANY

- **Citation:** [1972] 1 S.C.R. 916
- **Court:** Supreme Court of India
- **Decided:** 1971-09-24
- **Bench:** C. A. Vaidial!Ngam, P. Jaganmohan Reddy
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/commissioner-of-income-tax-central-new-delid-v-m-s-s-zoraster-company-5487
- **Pages:** 11

## Headnote

lncome-tax--Certificate to appeal to Suoren1e Court-Dutv of Hi.eh
Court in grantinR certificate-No jurisdiction to go behind the finding
recorded in original judgnlent1 disposing of the Reference.
A
B
In re•pect of the goods supplied by the a"e"ee the Government of
India paid the price by cheques.
The cheques drawn on the &eserve
C
Bank of India, at Bombay, were received by the aSiCisee at Jaipur. outside the taxab!i:~ territories.
On the question whethet the amounts represented by the cheques, cashed at Bombay, were taxable in the hands of
the asse.,ee under the Income-tax Act, 1922. t~o High Court, on reference, held that the mere fact that the cheques were realised at Bon1bay
was of no consquence and that in the particular circumstances of Ihe case
since the cheques were 'received by the asse~ce outside the taxable territory the amounts covelred by the cheques were received by the assessce at
D
that place. Jn dealing with the contention of the revenue that the asse~sec
must be considered to have received the cheques at Delhi where they v.·ere
posted, the High Court accepted the finding recorded by the Appellate
1'ribunal in its supplementary statement that the revenue failed to e~t<.1blish .'he fact of posting of cheques at Delhi. The High Court also recorded
a fintling that the revenue failed to place any material before the Tribunal
to prove that the cheques were being Eent by the Government of lndia
through po•t.
E
The revenue filed applications before the High Couet for .arant of
certificate for appeal to this Court.
The learned Judges who dealt with
the~e applications were different from those who dealt with the n.ain
reference.
Two alternate grounds \\>ere urged viz., ( 1) the payments by
cheques wete not made at Jaipur where the cheques were received. but
at Bombay where they were cashed arid (ii) the cheques were posted at
Delhi and as the post office acted as the agent of the assessee the payF
ment was made at Delhi.
On the first ground the High Court held that
in view of the decisions of this Court no substantial que11tion of h1w
remained to be decided; but, granted certificate to appeal on the selond
ground. it held that the question of law which really arose was whether
a presumption could be dlrawn under the circumstances of the case that
the cheques were sent by the Government by post or whether the fact
of sending the cheques by post had to be positively proved by the Revenue.
The court also observed that the general question whether a pr.:=sumpG
tion under s. 114 illustration (f) of the Evidence Act could be raised
in cfrcumstailces such as those prescnti::d by the case was likely to arise
in many future cases not restricted to i!Jcome-tax.
In this Court a preliminary objection .vas raised as to the maintainability of the appeals on the ground that the certificates granted by the
High Court were not proper. It was urged th•t the High Court erred in
ignoring the specific findings recorded by the Tribunal, and accepted hy
H
the learned Judge' answering the reference, that the Revenue placed no
evidence .before it to show that the cheques were po•ted at Delhi, and.
therefore, there -was no question of any presumption arising under s. 114
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C.I.T. v. s. ZORASTER & co. (Vaidialingam, J.)
917
illustration (f) of the Evidence Act. Setting aside the order of the High
Court grantin2 tlJe certificate,
HELD : (i) In circumstances like the present case the jurisdiction
of the court at the stage of dealing with application for grant of certificate
is 1in11ted only to considering whether any substantial question of law arises
having due regard to the material on record and the discu5'ion on facts
and law contained in the judgment of the High Court which dealt with
the appeal or reference or any other proceeding as the case may be .. [924 E]
(ii) On the findings recorded by the Appellate Tribunal and by the
High Court no question of applying any presumption under s. 114 of the
Evidence Act arises for considerati

## Text

916
COMMISSIONER OF INCOME-TAX (CENTRAL),
NEW DELID
V.
M/S. S. ZORASTER & COMPANY
September 24, 1971
[C. A. VAIDIAL!NGAM AND P. JAGANMOHAN REDDY, JJ.J
lncome-tax--Certificate to appeal to Suoren1e Court-Dutv of Hi.eh
Court in grantinR certificate-No jurisdiction to go behind the finding
recorded in original judgnlent1 disposing of the Reference.
A
B
In re•pect of the goods supplied by the a"e"ee the Government of
India paid the price by cheques.
The cheques drawn on the &eserve
C
Bank of India, at Bombay, were received by the aSiCisee at Jaipur. outside the taxab!i:~ territories.
On the question whethet the amounts represented by the cheques, cashed at Bombay, were taxable in the hands of
the asse.,ee under the Income-tax Act, 1922. t~o High Court, on reference, held that the mere fact that the cheques were realised at Bon1bay
was of no consquence and that in the particular circumstances of Ihe case
since the cheques were 'received by the asse~ce outside the taxable territory the amounts covelred by the cheques were received by the assessce at
D
that place. Jn dealing with the contention of the revenue that the asse~sec
must be considered to have received the cheques at Delhi where they v.·ere
posted, the High Court accepted the finding recorded by the Appellate
1'ribunal in its supplementary statement that the revenue failed to e~t<.1blish .'he fact of posting of cheques at Delhi. The High Court also recorded
a fintling that the revenue failed to place any material before the Tribunal
to prove that the cheques were being Eent by the Government of lndia
through po•t.
E
The revenue filed applications before the High Couet for .arant of
certificate for appeal to this Court.
The learned Judges who dealt with
the~e applications were different from those who dealt with the n.ain
reference.
Two alternate grounds \\>ere urged viz., ( 1) the payments by
cheques wete not made at Jaipur where the cheques were received. but
at Bombay where they were cashed arid (ii) the cheques were posted at
Delhi and as the post office acted as the agent of the assessee the payF
ment was made at Delhi.
On the first ground the High Court held that
in view of the decisions of this Court no substantial que11tion of h1w
remained to be decided; but, granted certificate to appeal on the selond
ground. it held that the question of law which really arose was whether
a presumption could be dlrawn under the circumstances of the case that
the cheques were sent by the Government by post or whether the fact
of sending the cheques by post had to be positively proved by the Revenue.
The court also observed that the general question whether a pr.:=sumpG
tion under s. 114 illustration (f) of the Evidence Act could be raised
in cfrcumstailces such as those prescnti::d by the case was likely to arise
in many future cases not restricted to i!Jcome-tax.
In this Court a preliminary objection .vas raised as to the maintainability of the appeals on the ground that the certificates granted by the
High Court were not proper. It was urged th•t the High Court erred in
ignoring the specific findings recorded by the Tribunal, and accepted hy
H
the learned Judge' answering the reference, that the Revenue placed no
evidence .before it to show that the cheques were po•ted at Delhi, and.
therefore, there -was no question of any presumption arising under s. 114
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C.I.T. v. s. ZORASTER & co. (Vaidialingam, J.)
917
illustration (f) of the Evidence Act. Setting aside the order of the High
Court grantin2 tlJe certificate,
HELD : (i) In circumstances like the present case the jurisdiction
of the court at the stage of dealing with application for grant of certificate
is 1in11ted only to considering whether any substantial question of law arises
having due regard to the material on record and the discu5'ion on facts
and law contained in the judgment of the High Court which dealt with
the appeal or reference or any other proceeding as the case may be .. [924 E]
(ii) On the findings recorded by the Appellate Tribunal and by the
High Court no question of applying any presumption under s. 114 of the
Evidence Act arises for consideration.
The learned Judges, dealing v.ith
the application for grant of certificates, had no jurisdiction to go behind
the finding recorcled in the oriainal judgment disposing of the reference.
[925 FJ
(iii) This Court should not be invited to decide any question of law
much less substantial question of law, purely in the abstract. The question of law must reasonably arise on the basis of the material on record.
[924 HJ
(iv) Regarding the question that the assessee may be considered to
have noceived the payments at Bombay the learned Judges~rightly declined
to gfant a certificate.
CIVIL APPELLATE JUR.ISDICTION :
Civil Appeal Nos. 2012
and 2013 of 1968.
Appeals from the judgment and order dated February 21, 1967
o,f the Delhi High Court in Income-tax Reference No. 7 of 1961.
R. H. Dhebar, Urmila Kapoor and P. L. Juneja, for the appellant (in both the appeals).
N. D. Karkhanis, Ram Lal, A. T. M. Sampath and E. c. Agrawala, for the respondent (in both the appeals).
The Judgment of the Court was delivered byVaidialingam, J.
These t,Wo appeals, on certificate, by the
Commission.er of Income-tax (Central) New Delhi, are directed
against the common judgment and order dated February 21, 1967
in Income-tax Reference No. 7 of 1961. The reference related
to the assessmsnt years 1942-43 and 1943-44. The question of
law, referred for the opinion of the High Court under s. 66( 1)
of the Indian Income-tax Act, 1922 (hereinafter ito be referred
G
to as the Act) was as follows :
H
"Whether on the facts and circumstances of the case,
the profits and gains in respect of the sales to
the
Government of India, were received by the assessce in
the taxable territories."
The High Court answered the said question in favour of the
as~essee as follows :
"On ·the facts and circumstances of the case, the
profits and gains in respect of the sales, made to the
918
SUPREME COURT REPORTS
(1972] l S.C.R.
Government of India, must be deemed •to have been
received by the assessee outside the taxable territories."
When Mr. R. R. Dhebar, learned counsel for the Revenue·
opened the appeals, a preliminary objection was raised by Mr.
N. D. Karkhanis, learned counsel for the assessee-respondent that
the certifica!tes granted by the High Court are not proper and as
such the appeals am not maintainable. The nature of the preliminary ob.iection will be referred to by us in due course.
As we
are accepting the preliminary objection, we will only refer to the
facts in so far as they are relevant for holding ithat the certificates
granted are not proper and as such the appeals aP~ not maintainable.
The assessee-respondent is a firm consisting of three partners,
namely, Sohanmal, Mehtabchand and Allahdin.
Sohanmal and
Mehtabchand are also the two coparceners of a Hindu Undivided
Family. The said family had got its own business firm known also
by the name of the assessee, M/ s. S. Zoraster and Company.
The
assessee firn:i, as well as the joint family firm, were both situated
in Jaipur, which was outside the taxable territories at the r~levant
period. The assessee had business dealings with •the Government
of India.
In respect of the goods supplied by the said firm, the
Government of India paid the price by cheues. The cheques in
question were reo~ived by the assessee at Jaipur.
However, the
said cheques were drawn on the Reserve Bank of India, at Bombay.
The assessee, through the agency of the family firm, sent those
cheques to Bombay for collection and realised the amounts due
under the cheques at Bombay.
The question arose whether the
amounts represented by the cheques, which
were
cashed
at
Bombay, were 1taxable in the hands of •he assessee under the Act.
The Income-tax Officer, the Appellate Assistant Commissioner.
as well as the Appellate Tribunal held that as the amounts bad
been realised in Bombay, which is a taxable ierritory, the amounts
covered by the cheques were liable ito tax under the Act.
On an application made by the assessee, the Appellate Tribunal made a Reference on December 10, 1952 to the High Court
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of Judicature for the State of Punjab at Simla .. The question of
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law, that was referred to the High Court was one, which we have
set out in the earlier part of the judgment.
The Reference was
numbered as Civil Reference Case No. 3 of 1953 in the Punjab
High Court.
As, in the opinion of the High Court, the Appellate
Tribunal had not given a finding as to whether the cheques in
question were sent to the assessee by post and whether the
H
assessee had given any direction in that regard to the Government
of India, by its order dated March 24, 1955, a supplementary
statement was called for.
The assessee challenged this order of
,.,,
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C.I. T. v. s. ZORASTER & co. ( Vaidialingam, J.)
9 I 9
the High Court calling for a supplementary statement in an appeal
before this Court.
By its order dated August 17,
1960, this
Court dismissed the said appeal.
The decision of this Court is
reported in Zoraster & Co. v. Commissioner of Income-tax(').
After the decision of this Court, the Appeilate Tribunal, on March
18, 1961 submitted to the High Court a supplementary statement.
The case was renumbered in the High Court as Income-tax Reference No. 7 of 1961.
At this stage it may be mentioned that in
'11e supplementary statement, the Appellate Tribunal had recorded a finding that there is no material on record to show as to how
the cheques in question were sent, i.e. whether by post or by hand.
The Appellate Tribunal further found that the assessee had given
a direction to pay by cheques and that apart from this there was
no other material on record to show any direction given by the
assessee regarding the mode of dispatch of cheques.
The High Court, in its order under attack, noted the findings
recorded by the Tribunal, namely, that the cheques were received
by the assessee at Jaipur, but collected at Bombay, and that it is
not established how the cheques were sent to the assessee by the
Government of India.
The Revenue contended before the High
Court that the amounts covered by the cheques in question must
be considered to have been received by the assessee in the taxable
territory, either at Bombay, on the basis that the amounts covered
by the cheques were realised at that place, or at Delhi, on the
E
ground that the cheques must be considered to have been received
by the assessee at that place where the cheques were posted, as
the post office is to be considered, the agent of the assessee.
The
High Court first considered the question as to what is the effect
of payments made by the Government to the assessee by means
of cheques.
After a reference to certain decisions of this Court,
F
the High Court held that the mere fact that the cheques
were
realised at Bombay is of no consequence.
In the particular cir,
cumstances of the case, the High Court is of the view that as the
cheques were received by the assessee at Jaipur, it must be held
that the amounts covered by the cheques were received by the
assessee at that place, which was outside the taxable territory.
G
In dealing with the contention of the Revenue that the cheques
must be considered to have been received by the assessee at Delhi,
where they were posted, the High Court again, after a reference to
the relevant decisions of this Court, adverted to the finding recorded by the Appellate Tribunal that there is no evidence to show
that the cheques were sent by post.
In fact, it is pertinent to
H
note how the High Court actually dealt with this quesion.
It
observed as follows :
(!) [1960j 40 I.T.R, 552.
920
SUPhEME COURT REPORTS
[ l 972] 1 S.C.R.
"If there was a finding by the Tribunal that the
Government of India was invariably sending the cheques
referred to earlier from Delhi to Jaipur through post
and that the assessee was receiving those cheques without demur, then we would have found no difficulty in
upholding the contention of Shri Kapur that the cheques
in question were sent to the assessee through post with
its implied consent and, that being so, the post office
should be considered as the agent of the assessee.
But
as mentioned earlier, in the instant case, there is no
evidence to show that those cheques were sent by post.
Hence the question of assessee's consent, implied or
otherwise, does not arise for consideration."
Later on, the High Court has also observed that the stark fact is
that there is no finding by the Appellate Tribunal that the Government of India sent the cheques by post and that the Revenue has
failed to place any material to prove that the cheques in question
were being sent by the Government through post.
On the basis
of the above finding, the High Court answered the question, referred to it, in favour of the assessee.
The Revenue filed two applications, Supreme Court Applications Nos. 95 and 96 of 1967 before the High Court for grant of
certificates declaring the cases to be a fit one for appeal to this
Cou~t. Supreme Court Application No. 95 of 1967 related to
the assessment year 1942-43 and No. 96 of 1967 related to the
assessment year 1943-44.
In the grounds of appeal, in particular,
it was stated that the High Court has not properly interpreted the
decisions of this Court and that the High Court further erred in
holding that there was no proof as to how the cheques were
received by the assessee in Jaipur.
Another ground was taken
that the evidence on record establishes that the
cheques were
issued and sent to the assessee at his request by post.
The learned Judges, who dealt with the applications for grant
of certificates were different from those who dealt with the main
Reference.
By order dated July 15, 1968, the High
Court
granted the certificates that the cases are fit for appeal to this
Court.
Before the learned Judges, the Revenue contended that
the assessee must be considered to have received the amounts
covered by the cheques in the taxable territories on two alternative grounds : ( 1) that the payments by cheques made by the
Government of India from Delhi to the assessee at Jaipur were
not made at Jaipur where the cheques were received by the
assessee but at Bombay where the cheques. were cashed, or (2) the
cheques were posted by the Government of India at Delhi to the
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,
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C.!.T. v. s. ZORASTER & co. (Vaidialingam, J.)
921
address of the assessee at Jaipur and as the post office acted as an
agent of the assessee in receiving cheques the payment wa•; made
at Delhi and not at Jaipur.
Regarding the first ground the learned Judges held "that it has
been convincingly negatived by the learned Judges, who dealt with
the reference on the authority of the decisions of tL's
Court."
There is a reference to the decisions of this Court, as well as the
finding recorded by the High Court when answering. the reference.
The learned Judges finally held that the Reve1nue is not entitled
to a certificate on the basis of ground No. I in the following
words:
"In view of the Supreme Court decisions fully c0'·U·
ing this point, no substantial question of law
iurther
remains to be considered regarding this aspect of the
case."
Regarding the second ground, that the cheques were posted by the
Government at Delhi and that the post office acted as an agent of
the assessee and therefore the amounts covered by the cheques
must be considered to have been received by the assessee at Delhi,
which is a taxable territory, the learnel Judges are of the view
that the said contention cannot be rejected on the plea that no
substantial question of law arises for consideration by this Court.
In considering this aspect, the learned Judges observe that it is
common knowledge that cheques are invariably sent by post and
the Government of India, which has to make payments by cheques
to numerous persons situated all over India, cannot be expected
to send messengers carrying cheques to the various places. There
is a reference to certain English decisions, from which the learned
Judges inferred that a common usage can be inferred that cheques
are always sent by post and never through personal messengers in
countries where postal communication is universal. . The learned
Judges further observe that the only reasonable and proper way
of dealing with the situation when payments have to be made by
cheques by the Government is to assume that the latter would send
cheques by post.
The High Court is c: the view that
cert~in
decisions of this Court support the case of the Revenue that parties
intended that cheques issued by the Government of India at Delhi
should be sent to Jaipur by post.
The learned Judges then referred to what in their opinion is a misunderstanding by the High
Court of the decisions of this Court when answering the reference
and characterised the said misunderstanding as unfortunate. The
learned Judge~ then referred to illustration ( d) to s. 50 of the
Indian Contract Act and expressed the view that posting of the
cheques in Delhi by the Government amounts to payment of
7-LI 19Sup .Cl/72
922
SUPREME COURT REPORTS
[1972] l S.C.R.
money to the assessee in Delhi and that is the position regarding A
the present assessee.
Ultimately, the learned Judges held that
the question of law which really arises in the present Ca6e is
whether a presumption could be draw'n under the circumstances
of the case that the cheques were sent by the Government to the
assessee by post or whether the fact of sending the cheques by
post must 1* positively proved by the Revenue. After referring to B
s. 114 of the Indian Evidence Act and in particular to illustration (f) thereof, the learned Judges observe that in the case on
hand the cheques should have been sent by the Government from
Delhi to the assessee either by post or by the messenger and that as
it is not the case of either party that the cheques were sent by the
messenger, the only conclusion to be drawn is that the cheque& c
must have been sent by post. Any other conclusion, accordin:
to the learned Judges, apart from being improbable will also be
absurd ~d, therefore, the only alternative, on which one can
proceed JS that the cheques must have been sent by post. There
is a cJiscussion how the risk can be avoided by the cheques bein:;
drawn in a particular manner when they arc sent by post.
0
According to the learned Judges, the most natural finding should
be that the cheques were sent from Delhi to Jaipur by post.
Actually, what according to the learned Judges, is the substantial
question of law, on the basis of ground No. 2 and in respect of
which the certificates have been issued may be reproduced in thetr
own wo_rds:
" .... whether the common course of usage can load
to the presumption that not only the parties intended
that the cheques should be sent by post but that the
cheques were actually sent by post.
This question has
not been considered by this Court and does not appear
to have been considered in any other reported judicial
decision. The question whether the profits in a case
were received in taxable territories or not is not likely
to arise in further cases in view of the fact that the
distinction between taxable and non-taxable territori5
does not now obtain.
But the general question whether
a presumption under Section 114, illustration (f) of the
Evidence Act should be raised by Court in circumstances such as those that are present in this case, is of
great importance. It is likely to arise in many future
cases not restricted to income-tax.
Not only is there no
specific decision of the Supreme Court on this question,
but even a High Court decision covering this point has
not been brought to our notice.
We, therefore, certify
that these two cases are fit for appeal to the Supreme
Court."
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C.I.T. v. s. ZORASTER & co. (Vaidialingam, /.)
923
A
The preliminary objection of Mr. Karkhanis to the maintainability of the appeals on the ground that the certificates lf.'anted ·
by the High Court are not proper, is as follows: The learned
Judges have declined to grant certificate on the ground that no
substantial question of law remains to be c0111Sidered regarding the
first contention that was urged by the Revenue, namely, that the
B assessee when he cashed the cheques at Bombay, must be considered to have received the amounts in the taxable territory. But
so far as the second _contention raised by the Revenue was concerned;' which related to the posting of the cheques by the Government of India, at Delhi, the High Court in coming to the conclusion that there is a substantial question of Jaw has grossly
erred in ignoring the specific findings recorded by the Appellate
Tribunal that tlie Revenue placed no evidence before it to show
c
that the cheques were posted at Delhi, which finding has been
accepted by the High Court when answering the Reference. In
view of this finding of fact, according to the learned counsel,
there is no question of any presumption arising under s. 114, illusD tration (f) of the Evidence Act coming into play. The counsel
further urged that the learned Judges have granied a certificate on
a matter which did-not arise for consideration and which was not
in dispute before the High Court when it answered the Reference
and which point had not even been raised in the applications for
grant of certificate. When there was a categorical finding that
the Gov~mment placed no evidence regarding the posting of
cheques at Delhi, the reasoning of the learned Judges when dealing with the applications for grant of certificates that the cheques
E
must have been posted at Delhi, is opposed to evidence. Further,
it was a conclusion which cannot be reached at the stage of
~ng a certificate, being quite contrary to that reached by the
High Court when dealing with the Reference.
In short, accordF
ing to the learned counsel the certificates have been granted on a
point which does ·not arise for consideration in the appeals.
Mr. Dhebar, learned counsel for the Revenue, contended that
. the High Court has considered all aspects when granting the certific:nes and that there is no infirmity attached to the orders
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granting certificates that the ·cases are fit for appeal to this Court.
According to the counsel, this was a fit case where the presllnlption arising under s. fl 4 of the Evidence Act should have been
applied by the High Court when dealing widJ the Reference.
Mr. Dhebar, finally contended that as the certificates have been
issued properly, the appeals are maintainable. The counsel fur7
H
ther urged that as reasons had to be given in the order granting
certificates. of fitness, it is inevitable that there should be some discussion about the nature· of the questions that arose for decision
before the Bench which answered the Reference.
924
SUPREME COURT REPORTS
[1972] l S.C.R.
While we agree with Mr. Dhebar that reasons for granting
A
the certificate must be given by the learned Judges in the order,
those reasons, however, in our opinion, must be confined to the
material on record, which must have been before the Court
'which dealt with an appeal or Reference and in respect of which
decision, the aggrieved party desires to come in appeal to this
Court on certificate on the ground that a substantial question of B
law arises for consideration.
We are not inclined to accept the contention of Mr. Dhebar
that the High Court has properly exercised its jurisdiction fa
certifying that the two cases are fit for appeal to this Court.
We must frankly admit that whe.n we went through the order of c
the High Court granting the certificates, we felt that the learned
Judges were either sitting in appeal over the judgment of the
Division Bench, which answered the Reference, or were themselves dealing with the Reference under s.66(1) of the Act, ip
the first instance. Unless the learned Judges were exercising one
or the other of the above jurisdiction, the criticism about the
approach made by the Division Bench when answering the ReD
ference, could not be justified.
It is clear that when dealing
with an application for grant of certificate of fitness, the court
was exercising no such jurisdiction. It must be emphasised that
in the circumstances like this, the jurisdiction· of the Court, at
the stage of dealing with application for grant of certificate is
limited only to considering whether any substantial question of E
law arises having due regard to the material on record and the
discussion on facts and. law contained in the judgment of the
High Court which dealt with the appeal or Reference or any
other proceeding, as the case may be. .
Regarding the question that the assessee may be considered
to have received the payments at Bombay, the learned Judges
F
have quite rightly declined to grant a certificate on the ground
that the point is covered by the decisions of this Court and that
no substantial question of law arises.
As we have already pointed out the
certificate has been
granted by the learned J μdges on the basis that the
general
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question whether a presumption under s. 114, illustration ( f) of
the Evidence Act can be raised is of great importance and that
it is likely to arise in many future cases, not restricted to incometax.
It should be remembered that this Court should not be
invited to decide any question of law much less the substantial
question of law purely in the ~bstract.
Such question of law
must reasonably arise on the basis of the material on record. .H
Further, the substantial question of law, in order to be certified
as fit to be decided by this Court inust arise on the facts of a
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C.J.T. v. s. ZORASTER & co. (Vaidialingam, J.)
925 .
particular case. · With great respect to the learned Judges who
dealt with the applications for grant of certificate, we are constrained to remark that they have ignored the finding of fact recorded by the Appellate Tribunal in its supplementary statement
dated March 18, 1961 that the Revenue has placed no materials
to prove that the cheques were posted at Delhi.
It should be
remembered that when the Reference was made in the first
instance, the Punjab High Court felt that the Appellate Tribunal
had not given any finding as to whether the cheques in question
were sent to the assessee by post and whether the assessee had
given any direction in that regard to the Government of India.
In view of the absence of such a finding, the High Court by its
order dated March 24, 1955 called for a supplementary statement from the Appellate Tribunal under s.66 ( 4) of the Act.
This order was challenged before this Court by the assessee un5nccessfully.
The purpose of seeking a supplementary .statement was to focus the attention of the Appellate Tribunal to
this aspect, namely, the posting of cheques claimed to have been
done at Delhi by the Government of India.
That the Revenue
miserably failed to establish the fact of posting of cheques at
Delhi, is clear from the finding recorded by the Appellate Tribunal in its supplementary statement, which finding has been
accepted by the High Court in its judgment dated February 21,
1967 ·when answering the Reference. The High Court has also
then recorded a finding that the Revenue has failed to place any
material before the Appellate Tribunal to prove that the cheques
in question were being
sent by the
Government 'of
India
through post. Unfortunately, all those aspects have been missed
by the learned Judges when dealing with the applications filed
by the Revenue for the grant of certificates.
On the above findings recorded by the Appellate Tribunal
and confirmed by the High Court, no question of applying any
presumption under s. 114 of the Evidence Act arises for consideration.
The learned Judges, dealing with the applications for
grant of certificates, had no jurisdiction to go behind the finding
recorded in the original judgment disposing of the Reference.
In our opinion, the entire discussion on this aspect of posting of
the cheques at Delhi by the learned Judges is beside the poi~t,
as that question no longer was available to the Reve;nue, m
view of the finding recorded against it, to which we have made
a reference earlier.
When once the .question of a presumption under s. 114,
illustration (f) of the; Evidence Act does not fall to be considered in these proceedings, in view of the specific finding recorded by the Appellate Tribunal against the
Revenue,
and
926.
SUPREME COURT REPORTS
[l 972J 1 S.C.R
accepted by the High Court, in our opinion, the High Court was
not justified in certifying, on this ground, that the cases are fit
for appeal to this Court.
As the issue of certificates by the High Court is not proper,
the only course oJien to us is to cancel the certificates and set
aside the order of the High Court granting them.
The result
is that the above appeals have become unsustainable, as they
have beeu brought to this Court on the basis of certificates,
which, as held by us, have not been properly granted.
The appeals, accordingly, are held to be not maintainable
and are dismissed with cost. There will, however, be only one
hearing fee.
K. B. N.
Appeals dismissed.
A
B
c