To answer these questions, the Delhi High Court in C.I.T. v. Sudhir Choudhrie ([2005] 147 Taxman 306) first referred to the provisions of Section 245-R(6) of the Act wherein the Authority entertaining an application for advance ruling under Section 246-Q is required to pronounce its advance ruling in writing within six months from the date of the application.

The entire emphasis is on the use of two different expressions in Sections 254 and 245-R of the Act. According to the Delhi High Court, the fine distinction between the words `pass' and `pronounce' should not be stretched to the extent that it offends the basic rule of law. The expression `pass' in common parlance means `to deliver'. It has been given a wide meaning and connotation, depending on the reference in which the expression is used.

The Law Lexicon, 1997 edition, explains this term `pass' as to be allowed or approved by a court or by a legislative or deliberative body; to be given or pronounced (in case of verdict, reference or judgment), as in `pass judgment' as `deliver judgment'.

Black's Law Dictionary, Sixth Edition, says the word `pass' means:

"To utter or pronounce, as when the court passes sentence upon a prisoner. Also to proceed; to be rendered or given, as when judgment is said to pass for the plaintiff in a suit."

`Pass', `publish' and `sell' are in some respects convertible terms and, in a given case, `pass' may include publish and sell. The term `pronounce' means to proclaim, to utter formally, to utter rhetorically, to declare, to utter articulate. `Pronouncement' in relation to a judgment requires the authority to apply its mind and arrive at a conclusion whether there is any cause to modify or remit the award?

Further, the phrase `pronounce judgment' would itself indicate judicial determination by a reasoned order (Union of India v. Manager, Jain and Associates ([2001] 3 SCC 277). The meaning of `pronounce' in terms of Black's Law Dictionary is as under:

"To utter formally, officially, and solemnly; to declare or affirm; to declare aloud and in a formal manner. In this sense a court is said to `pronounce' judgment or a sentence."

The Supreme Court, in the case of Income-tax Appellate Tribunal v. V. K. Agarwal ([1999] 1 SCC 16), stated that under the Income-Tax Tribunal Rules `final order' means the order of the Bench, signed and dated by the Members constituting it. After the order is signed, the Tribunal should cause it to be communicated to the assessee and the Commissioner.

The word `order' is understood to be a mandate, precept; command or direction authoritatively given. The expression is wide enough to include an interim order and a final order.

An order is in the form of a decision which contains reasoning for the conclusion and such an order is to be signed on a date by the concerned authorities. The purpose of `passing an order' under Section 254(1) of the Act is to empower the Tribunal to pass such orders which it may think fit and proper in the circumstances of the case. `Order' is a mandate, precept or command but reasoning is its soul and it would obviously be a final order or judgment. There is nothing in Section 254(1) which, on a plain reading or by necessary implication, may indicate that the Tribunal could decline to pronounce the orders that are obviously to be dated and signed on a given date to make such orders effective and binding. To argue that there is no specific provision like Section 245-R(6) requiring the Tribunal to pronounce its order would be a travesty of justice as such an order is passed for the benefit of the parties to the suit.

Communication of the order for the purposes of limitation or as postulated under Section 254(3) falls in a different field and domain. Known precepts of procedural law would necessarily impose an obligation upon any forum or Tribunal, judicially determining the rights of the parties to declare its order on the date it is signed and declared. The requirement of letting the parties know the contents of the order upon its declaration is necessary. This requirement transcends all technical rules of procedure. According to the Court, the Income-Tax Appellate Tribunal adjudicates on a dispute between the parties but the magnitude of the liabilities and consequences flowing from such orders often involve huge sums of money. The right of the party to know the contents of the order on the very date of its signing cannot be denied.

The provisions of Section 254(1) cannot be construed, so as to exclude the act of pronouncement. In fact, this provision does not deal with the manner of writing, dating or pronouncement of orders, but is a provision which primarily deals with the empowerment of the Tribunal to pass appropriate orders in the given facts of a case.

Even if the provisions are silent in this regard, to construe the word `pronouncement' to include such an act would be necessary by the very nature of things and would impose an obligation upon the Tribunal to pronounce its orders when they are dated and signed by the Members of the Bench. Dating and signing of judgment and declaration is a procedural matter and this would, if complied with, in no way infringe on the rules of procedure.

The Delhi High Court came down heavily on the Income-Tax Appellate Tribunal by stating that the approach which offends the cause of basic notions of justice and proceeds upon a total disregard of procedural requirement inbuilt in the basic rule of law would vitiate the administration of justice. The very foundation of the administration of justice is firmly laid in the rule of law, and all authorities/Tribunals are constitutionally mandated to act in conformity with this rule.

The Court observed that the practice prevalent in Courts in relation to dating, signing and pronouncement of judgment should be made applicable to cases pending before the Income-Tax Appellate Tribunal. Such a practice would not be contrary to any provision of the Income-Tax Act.

The High Court categorically held that the stand taken on behalf of the Income-Tax Appellate Tribunal was without substance and merit. Exercising its extraordinary jurisdiction under Articles 226/227 of the Constitution, the Court directed the Income-Tax Appellate Tribunal to pronounce its judgments and orders in open court on a specified date. This practice should be adopted by the Tribunal in addition to its obligation to communicate the orders as contemplated under Section 254(3) of the Act and Rule 35 of the Rules.

Possibly for the first time, the High Court directed the Income-Tax Appellate Tribunal to pay within one week from the date of its judgment costs of Rs 5,000 to the Delhi Legal Services Authority. This direction of the High Court was passed to show its displeasure on the stand taken by the Tribunal, which resulted in the Court spending its time in hearing this case.

(The author, a Mumbai-based advocate specialising in tax laws, can be contacted at ranina@bom2.vsnl.net.in)

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