Meaning of “Advisory jurisdiction”

The meaning of advisory jurisdiction under section 256 to 260 of the Income Tax Act is not defined in the act itself. But we can take guidance from decisions by various high courts. Here are excerpts of courts orders in which the Hon’ble High Court tried to explain the meaning of advisory jurisdiction.

Meaning of advisory jurisdiction defined by court

The phrase ‘advisory jurisdiction’ used in section 256 to 260 of the Income Tax Act came up before hon’ble Karnataka high court in Sterling foods v. CIT [1991] 190 ITR 275 (Kar.) and it explained.

Meaning: The expression ‘advisory jurisdiction’ which is used more as convenient expression to describe the special jurisdiction, does not necessarily mean that the advisory jurisdiction will not be binding on the tribunals which function within the jurisdiction of the court.

Section 256 to 260 of Income Tax Act

Statement of case to the High Court.

256.(1) The assessee or the Principal Commissioner or Commissioner may, within sixty days of the date upon which he is served with notice of an order passed before the 1st day of October, 1998, under section 254, by application in the prescribed form, accompanied where the application is made by the assessee by a fee of two hundred rupees, require the Appellate Tribunal to refer to the High Court any question of law arising out of such order and, subject to the other provisions contained in this section, the Appellate Tribunal shall, within one hundred and twenty days of the receipt of such application, draw up a statement of the case and refer it to the High Court :

Provided that the Appellate Tribunal may, if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the period hereinbefore specified, allow it to be presented within a further period not exceeding thirty days.

(2) If, on an application made under sub-section (1), the Appellate Tribunal refuses to state the case on the ground that no question of law arises, the assessee or the Principal Commissioner or Commissioner, as the case may be, may, within six months from the date on which he is served with notice of such refusal, apply to the High Court, and the High Court may, if it is not satisfied with the correctness of the decision of the Appellate Tribunal, require the Appellate Tribunal to state the case and to refer it, and on receipt of any such requisition, the Appellate Tribunal shall state the case and refer it accordingly.

(2A) The High Court may admit an application after the expiry of the period of six months referred to in sub-section (2), if it is satisfied that there was sufficient cause for not filing the same within that period.

(3) Where in the exercise of its powers under sub-section (2), the Appellate Tribunal refuses to state a case which it has been required by the assessee to state, the assessee may, within thirty days from the date on which he receives notice of such refusal, withdraw his application, and, if he does so, the fee paid shall be refunded.

In this article, you can get guidance from high courts on the meaning of advisory jurisdiction under section 256 to 260 of the Income Tax Act.

Updated up to Finance Act 2021