Commissioner of Income Tax-3 V. M/s.State Bank of hyderabad

ITTA/11/2016

AI Insights

The case involves six appeals filed by the Revenue against the decisions of the Income Tax Appellate Tribunal, which had refused to recall its earlier orders dismissing appeals due to the lack of approval from the Committee on Disputes. Initially, these appeals were dismissed based on a Supreme Court decision that required such approval. However, a subsequent Supreme Court decision clarified that this requirement was not a bar to filing appeals. Despite this clarification, the Tribunal dismissed the Revenue's applications to recall the earlier orders due to an inordinate delay in filing these applications. The Revenue contended that the delay was justified as it was only after the Supreme Court's clarification that they could file for recall. The High Court dismissed the Revenue's appeals, stating that the Tribunal's power to recall orders is limited by the statutory period, which cannot be extended.

• Counselvise Citation: [2016] 140 COUNSELVISE.COM (IT) 728039 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 18-07-2016
• Assessment Year: misc
• Other Referred Cases: Oil and Natural Gas Commission Vs. Collector of Central Excise, Electronics Corporation of India Limited Vs. Union of India and others
• Laws Referred To: Income Tax Act, 1961, Oil and Natural Gas Commission Vs. Collector of Central Excise, Electronics Corporation of India Limited Vs. Union of India and others
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: C P RAMASWAMI
• Assessee Lawyers: B SARMA
• Keywords: Committee on Disputes; Income Tax; Limitation Period; Recall of orders
• Section: 254(2); 260A

Judgement Text

"THE HON’BLE SRI JUSTICE V. RAMASUBRAMANIAN AND THE HON’BLE SMT JUSTICE ANIS I.T.T.A.Nos. 5, 11, 13, 14, 73 & 77 of 2016 COMMON JUDGMENT: (Per VRS,J) All these six appeals filed by the Revenue under Section 260A of the Income Tax Act, 1961, question the independent orders passed by the Income Tax Appellate Tribunal refusing to recall its earlier orders in six different appeals, relating to the assessment years 2005-2006, 1995-1996, 1993-1994, 2006-2007, 1994- 1995 and 1996-1997 respectively. 2. Heard Mr. B. Narasimha Sarma, learned senior standing counsel for the Income Tax Department, and Mr. C.P. Ramaswami, learned standing counsel for the respondent/assessee Bank. 3. As against the orders of the Commissioner of Income Tax (Appeals), dated 12.03.2011, relating to the assessment years 1993-1994, 1996-1997, 1997-1998 and 1995-1996, the Revenue filed appeals in I.T.A.Nos.395 to 397 and 555 of 2001 respectively before the Income Tax Appellate Tribunal. These appeals were dismissed by the Tribunal, on the short ground that the Revenue failed to obtain the approval of the Committee on Disputes, as mandated by the decision of the Supreme Court in Oil and Natural Gas Commission Vs. Collector of Central Excise[1]. Similarly, two more appeals filed by the Revenue in I.T.A.Nos.1954 of 1996 and 584 of 2008 relating to the assessment years 1993-1994 and 2005-2006, were also dismissed by the Tribunal, by orders dated 11.06.2002 and 19.03.2010 respectively. 4. But, subsequently, a Constitution Bench of the Supreme Court clarified in Electronics Corporation of India Limited Vs. Union of India and others[2] decided on 17.02.2011 that failure to obtain the approval of the Committee on Disputes, is not a bar for filing an appeal. The imposition of the restriction by the decision of the Supreme Court in ONGC-III was withdrawn. 5. Thereafter, the Revenue filed miscellaneous applications before the Tribunal for recalling the orders of dismissal passed in their appeals on different dates. All these miscellaneous applications were dismissed by the Tribunal, on the sole ground that the applications for recalling the earlier orders were filed, after an inordinate delay, especially after four years. Aggrieved by the dismissal of their applications, for recalling the earlier orders, the Revenue has come up with these appeals. 6. The main grievance of the appellant/Revenue is that it was only after the decision of the Supreme Court dated 17.02.2011 that the Revenue became entitled to file applications for recalling of the earlier orders, especially in cases where no approval of the Committee on Disputes was obtained. Hence, it is contended by the learned senior standing counsel that the dismissal of the applications for recalling of the earlier orders, on the ground of inordinate delay, has no legs to stand. 7. We have carefully considered the above submissions. 8. The Tribunal is a creature of the statute. It cannot have any power other than what is conferred by statute. The only power conferred upon the Tribunal to recall its earlier orders, could be traced to Sub-Section (2) of Section 254. Sub-Section (2) of Section 254 enables the Tribunal to make an amendment of an order passed by it under Sub-Section (1), with a view to rectifying any mistake apparent from the record, provided it is done within four years from the date of the order. The expression “four years from the date of the order” has now been replaced by the words “six months from the end of the month in which the order was passed”, by the Finance Act, 2016 with effect from 01.06.2016. 9. There is no dispute about the fact that the miscellaneous applications filed by the Revenue in all these cases, were filed after four years from the date of the original orders dismissing the appeals of the Revenue. Therefore, the only power, under which the Tribunal could have recalled the orders, even if we assume that the power to recall the orders is inbuilt within Sub-Section (2) of Section 254, is only the same provision and nothing other than that. 10. Even in ECIL case (2 supra), the Supreme Court indicated that as per the decision in ONGC-III, the Revenue was entitled to file an appeal, to save the period of limitation. This is a clear indication of the fact that neither the Court nor the Tribunal would have had the power to undo the period of limitation prescribed for the exercise of any power by the Tribunal. By labelling the application as one for recalling its earlier order, the Department cannot take a devious route to reopen the application. 11. It is true that even the Supreme Court could not have divested the Revenue of their statutory right of appeal, but that was a point available for the Revenue to agitate in an appeal filed under Section 260A as against the order of Tribunal. The Revenue cannot seek the annulment or enlargement of the period of limitation prescribed in Section 254(2), by taking this route. Hence, all these appeals are dismissed. Consequently, miscellaneous petitions if any pending in the appeals shall stand dismissed. There shall be no order as to costs. __________________________ V. RAMASUBRAMANIAN, J ____________________ ANIS, J. 18th July, 2016 cbs THE HON’BLE SRI JUSTICE V. RAMASUBRAMANIAN Ö AND THE HON’BLE SMT JUSTICE ANIS I.T.T.A.Nos. 5, 11, 13, 14, 73 & 77 of 2016 (Per VRS,J) 18th July, 2016 cbs [1] 1995 Suppl. (4) SCC 541 [2] 2011 (265) ELT 11 (SC) (Larger Bench) "