Facts of the Case

The Revenue filed an appeal before the Delhi High Court under Section 260A of the Income-tax Act, 1961 against the order in favour of M/s Bansal Credit (P) Ltd. The issue sought to be raised by the Revenue had already been adjudicated by the Delhi High Court in the earlier decision of Commissioner of Income-tax vs Bansal Credits Ltd. (2003) 259 ITR 69.

The Revenue nevertheless attempted to pursue the appeal by submitting that the Supreme Court had issued notices in certain Special Leave Petitions involving similar issues. The Court examined whether any substantial question of law survived for consideration in light of the earlier binding precedent.

Issues Involved

  1. Whether any substantial question of law arose for consideration under Section 260A of the Income-tax Act, 1961.
  2. Whether the Revenue could maintain the appeal when the issue already stood concluded by a binding judgment of the Delhi High Court.
  3. Whether the pendency or issuance of notice in similar Special Leave Petitions before the Supreme Court justified entertaining the appeal.

Petitioner’s (Revenue’s) Arguments

  • The Revenue contended that although the issue had been decided by the Delhi High Court in an earlier case, the Supreme Court had issued notice in some Special Leave Petitions filed on a similar issue.
  • On that basis, it was urged that the present appeal should still be entertained and considered by the High Court.

Respondent’s Arguments

  • The respondent assessee relied upon the earlier judgment of the Delhi High Court in Commissioner of Income-tax vs Bansal Credits Ltd. (2003) 259 ITR 69.
  • It was contended that the controversy already stood concluded by the binding decision of the Court and therefore no substantial question of law survived for adjudication under Section 260A.

Court Order / Findings

The Delhi High Court held that:

  • The issue raised by the Revenue already stood concluded by the Court’s earlier decision in Commissioner of Income-tax vs Bansal Credits Ltd. (2003) 259 ITR 69.
  • Consequently, no question of law, much less a substantial question of law, survived for consideration under Section 260A.
  • The Court noted the submission of the Revenue regarding issuance of notice by the Supreme Court in certain Special Leave Petitions involving similar issues.
  • However, the Court observed that Special Leave Petitions filed both by the Revenue and the assessee against the earlier judgment had already been dismissed and the judgment had attained finality.
  • Since the earlier decision had become final and binding, the Court was not inclined to entertain the appeal.

Accordingly, the appeal filed by the Revenue was dismissed.

Important Clarification

The judgment reiterates an important principle governing appeals under Section 260A:

  • Once a legal issue has been conclusively decided by a binding precedent and such decision has attained finality, a subsequent appeal raising the same issue cannot be entertained merely because notices may have been issued in other similar matters.
  • Issuance of notice in a Special Leave Petition does not dilute the binding nature of a judgment that has already attained finality.
  • A High Court appeal under Section 260A is maintainable only where a substantial question of law genuinely arises for consideration.

Sections Involved

  • Section 260A of the Income-tax Act, 1961 – Appeal to High Court.
  • Issue arising from the earlier judgment reported in Commissioner of Income-tax vs Bansal Credits Ltd. (2003) 259 ITR 69.

Link to download the order -

https://delhihighcourt.nic.in/app/case_number_pdf/2003:DHC:18815-DB/DKJ31102003ITA4022003_153128.pdf

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