ITAT is 70

By Vijay Kumar

IT was on this day in 1941, that the Income Tax Appellate Tribunal was constituted. The very fact that the ITAT has honourably survived 70 long years, making it one of the oldest judicial institutions of the country, is itself a great tribute to the tribunalisation of justice. The Tax came to India by an Act of 1860 under which the tax was assessed by the Panchayat and the District Collector was an appellate Authority whose decision was final. By the 1868 Act, the Collector was made a penultimate appellate authority with appeal lying to the Divisional Commissioner of Revenue. The Income Tax as such was introduced by the Act of 1918, which provided for an appeal from the Commissioner to the Chief Revenue Authority and a reference to the High Court.

There was hardly any independent Authority for appeals and even the Government of India Act, 1935, barred interference in tax matters by the High Courts. The Income Tax Enquiry Report, 1936 suggested creation of a Tribunal with six Members, two High Court judges, two Income Tax officers with wide experience and two Members with accountancy or business experience.

The Income Tax Act, 1922 was amended to create the ITAT with effect from 25.01.1941. To start with three Benches were constituted at Delhi, Calcutta and Bombay. A fourth Bench was set up in Allahabad in 1942. Today there are more than 60 Benches in over 25 cities and towns.

Originally the Tribunal was with the Finance Department, but in 1942, it was transferred to the Law Department. See the CESTAT still being considered a subordinate/attached office of the Revenue Department of the Finance Ministry.

The First President of ITAT, Mohammad Munir , became a judge of the Lahore High Court and later for many years, the Chief Justice of Pakistan Supreme Court. Nani Palkiwala , said in 1981, “The 25th day of January, 1941, which was the date on which the Income Tax Appellate Tribunal was first constituted, was one of the milestones in the history of our fiscal law and administration.”

On this birthday, we wish that the Government provide more facilities and infrastructure for ITAT and its younger cousin the CESTAT.