M/s Indian Airlines Ltd., New Delhi V. DCIT, New Delhi

ITA 72/DEL/2011

• Counselvise Citation: 7220114 RSA 2011
• Duration Of Justice: 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 15-06-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 06-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHYAMA S BANSIA
• Keywords: Opportunity of being heard; Principle of natural justice; Bonafide belief; Period of limitation; Procedural lapse; Right to appeal; Condonation of delay
• Section: 45(2); 143(3); 147; 246

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH I : NEW DELHI BEFORE SHRI G.E.VEERABHADRAPPA, VICE PRESIDENT AND SMT.DIVA SINGH, JUDICIAL MEMBER ITA NO.72/DEL/2011 ASSESSMENT YEAR : 2001-02 M/S INDIAN AIRLINES LIMITED, (NOW AIR INDIA LIMITED), AIRLINES HOUSE, 113, GURUDWARA RAKABGANJ ROAD, NEW DELHI. PAN NO.AAACI0613E. VS. DY. COMMISSIONER OF INCOME TAX, CIRCLE-11(1), NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SMT. SHYAMA S.BANSIA, CIT-DR ORDER PER DIVA SINGH, JM : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORD ER DATED 29.10.2010 OF THE CIT(A) PERTAINING TO AY 2001-02. THE ASS ESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. THE LD.COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND FACTS IN DISMISSING THE GROUNDS OF APPEAL B Y HOLDING THAT THE MEMORANDUM OF APPEAL WAS NOT SIGNED BY THE MANAGING DIRECTOR, DIRECTOR OF THE APPELLANT COMPANY, WITHOUT APPRECIATING THE FACTS THAT THE SAME WAS DULY S IGNED BY THE GENERAL MANAGER (FINANCE) UNDER THE DELEGATION OF ADMINISTRATIVE POWERS DULY APPROVED BY THE BOARD OF DIRECTORS OF THE APPELLANT COMPANY. THEREFORE, THE ACTION OF THE LD.COMMISSIONER OF INCOME TAX (APPEALS) IS ARBITRARY, ILLEGAL UNJUSTIFIED AND AGAINST THE PROVISIONS OF LAW. I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 2 2. THE LD.COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND FACTS IN CANCELING THE APPEAL, WITHOUT APPRECIATING THE FACTS THAT THE PROVISIONS OF RULE 45(2)C AR E ONLY DIRECTORY BEING PROCEDURAL IN NATURE AND NOT MANDATORY, THE LD.COMMISSIONER OF INCOME TAX (APPEALS) WAS NOT JUSTIFIED IN HOLDING THAT THE GENERAL MANAGER FINANCE WAS NO SO EMPOWERED AND THE APPEAL WAS NOT ENTERTAINED ON MERITS. THEREFORE THE ACTION OF THE LD.COMMISSIONER OF INCOME TAX (APPEALS) IS ARBITRARY, ILLEGAL AND AGAINST THE PROVISIONS OF LAW. 3. WITHOUT PREJUDICE TO THE ABOVE, THE LD.COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND FACTS IN DISMISSING THE APPEAL, WITHOUT APPRECIATING THE FACTS THAT THE MISTAKE IF ANY PROCEDURE IN NATURE AND IS RECTIFIABLE FOR WHICH THE PROPER OPPORTUNITY HAS TO BE GRANTED TO THE APPELLANT. THEREFORE, THE ACTION OF THE LD.COMMISSIONER OF INCOME TAX (APPEALS) IS ARBITRARY, ILLEGAL AND AGAINST THE PROVISIONS OF LAW. 4. THE APPELLANT CRAVES TO ADD, AMEND ANY ADDITIONAL GROUNDS OF APPEAL AT THE TIME OF HEARING OR BEFORE THE HEARING OF APPEAL. 2. NONE WAS PRESENT ON BEHALF OF THE ASSESSEE AT THE T IME OF HEARING. THE RECORD SHOWS THAT ON AN EARLIER DATE, THE APPEAL W AS ADJOURNED AT THE REQUEST OF THE LEARNED AR ON BEHALF OF THE ASSESSEE. ACCORDINGLY, AFTER CONSIDERING THE MATERIAL AVAILABLE ON RECORD ON THE GROUNDS OF APPEAL, IT IS CONSIDERED APPROPRIATE TO PROCEED WITH THE P RESENT APPEAL EX-PARTE QUA THE ASSESSEE-APPELLANT ON MERITS. 3. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT THE CIT(A ) PASSED A CONSOLIDATED ORDER FOR AYS 2001-02 & 2005-06. 3.1. IN THE PRESENT APPEAL, WE ARE CONCERNED WITH AY 20 01-02. THE RELEVANT FACTS, AS TAKEN INTO CONSIDERATION BY THE CIT(A) Q UA THE SAID YEAR, ARE FOUND DISCUSSED AT PAGES 2 & 3 OF THE IMPUGNED ORDER. FOR READY REFERENCE, THEY ARE REPRODUCED BELOW:- I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 3 AY 01-02 :- THE ASSTT. WAS COMPLETED U/S 143(3) ON 30/01/04 COMPUTING TOTAL INCOME AT NIL AND AFTER ADJUSTMENT OF B/F LOSSES OF RS.2,16,94,94,200/-. THE CASE WAS REOPENED U/S 147 AFTER RECORDING THE REASON AND THEREAFTER COMPLYING WITH THE FORMALITIES THE ASSTT. WAS COMPLETED U/S 147/143(3) ON 30/03/07 COMPUTING TOTAL INCOME AT RS.102,01,19,124/- AND AFTER ADJUSTMENT OF B/F LOSSES THE TOTAL INCOME CAME TO NIL. THE ADDITION/DISALLOWANCE INTERALIA INCLUDES :- I) ON A/C OF PRIOR PERIOD EXPENSES (RS.70,49,711/-). 4. AGGRIEVED BY THIS ACTION THE ASSESSEE CAME IN APPE AL BEFORE THE CIT(A). 4.1. THE CIT(A) OBSERVED THAT THE RECORD SHOWS THAT CO NTRARY TO THE REQUIREMENT OF SEC. 140 OF THE INCOME TAX ACT, 1961 READ WITH RULE 45(2) OF THE I.T.RULES THE APPEAL WAS SIGNED BY THE GENERA L MANAGER (FINANCE) INSTEAD OF THE MANAGING DIRECTOR. ACCORDINGLY HE B ROUGHT THIS FACT TO THE NOTICE OF THE ASSESSEE. 4.2. BEFORE THE CIT(A) THE ASSESSEE CONTENDED THAT AS P ER THE BOARDS RESOLUTION DATED 28.6.93 DELEGATING THE ADMINISTRATIVE POW ERS TO THE GENERAL MANAGER (FINANCE) AND DGM (FINANCE), THE G.M.(FINANCE ) IS AUTHORIZED TO FILE APPEAL ON BEHALF OF THE ASSESSEE COMPAN Y. AS SUCH SIGNING AND VERIFYING WAS STATED TO BE CORRECT AND BEING A PROCEDURAL MATTER, DECISIONS WERE CONSIDERED TO BE NOT RELEVANT. S UBMISSIONS WERE FURTHER MADE ON MERITS. 4.3. THE SUBMISSIONS QUA THE ISSUE ARE SET OUT IN PAR AGRAPH 2.4 OF THE IMPUGNED ORDER. FOR READY REFERENCE THEY ARE REP RODUCED HEREUNDER. REGARDING PROPER FILING OF THE APPEAL:- THE BOARD OF THE A PPELLANT COMPANY PASSED A RESOLUTION ON 28.6.93 DELEGATING THE ADMINISTRATIVE POWER INCORPORATING CERTAIN CHANGES. THE FORWARDING LETTER DATED 14.2.94 WOULD SPEAK FOR ITSELF (P/1 OF ENCLOSURE ATTACHED WITH WRITTEN SUBMISSION DT. 22.10.10). PA RA I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 4 16.1 OF RESOLUTION HAS AUTHORIZED THE GENERAL MANAGER (F) A ND DGM (F) TO FILE THE APPEAL ON BEHALF OF THE APPELLANT COMPANY AND THAT IS WHY THE SAME WAS FILED. IT IS PROCEDURAL MATT ER AND THE APPELLANT HAS FOLLOWED THE SAME. IN BOTH THE ASSESSM ENT YEARS, UNDER APPEAL THE RETURNS WERE SIGNED AND VERIFIE D BY THE MD AND THE REASON IS THAT ON THE DATE OF FILING OF RETURN THE MD WAS AVAILABLE AND THE SAME WAS FILED UNDER HIS SIGNATURE A ND VERIFICATION. AS IT IS A PROCEDURAL MATTER, THERE IS NO NEE D FOR RELYING UPON ANY DECISION. 4.4. NOT CONVINCED WITH THE EXPLANATION OFFERED AND RELYING UPON THE ORDER OF THE TRIBUNAL IN THE CASE OF GOLD STONE EXPORTS LTD. VS. ACIT 104 ITD 15 (HYD.), THE CIT(A) DISMISSED THE APPEAL OF THE A SSESSEE HOLDING AS UNDER:- 2.5 EXAMINED THE SUBMISSION OF THE APPELLANT. IT IS AN ADMITTED FACT THAT IN ALL THE RELEVANT ASSESSMENT YEARS T HE RETURNS WERE FILED BY THE MANAGING DIRECTOR OF THE CO. WHIC H WAS AS PER SEC. 140 OF THE I.T.ACT 1961. THERE IS NO OTHER PROVISION FOR FILING OF APPEALS OTHER THAN RULE 45(2) OF THE IT RULES 1962 READ WITH SEC. 140 OF THE I.T.ACT. THE MANAGIN G DIRECTOR IS THE COMPETENT PERSON TO FILE AN APPEAL IN CASE OF A COMPANY AND WHERE FOR ANY UNAVOIDABLE REASON SUCH MANAGING DIRECTOR IS NOT ABLE TO SIGN AND VERIFY THE RETURN/APPEAL, OR WHERE THERE IS NO MANAGING DIRECTOR, TH E APPEAL MEMO COULD BE SIGNED BY ANY DIRECTOR THEREOF. IT IS CLEAR FROM THE RECORD THAT THERE WERE DIRECTORS AVAILAB LE ON THE DATE OF FILING OF THE APPEALS FOR THE TWO ASSESSMENT YE ARS, YET THE MANAGING DIRECTOR/DIRECTOR OF THE APPELLANT COMP ANY ON HIS OWN WISDOM HAS AUTHORIZED ANOTHER PERSON, GENERA L MANAGER (FIN.) TO FILE THE APPEALS. THE STATUTE DOES NOT PERMIT SUCH AN ACTION OF THE APPELLANT. THE STATUTE HAS VESTED THE POWER OF FILING APPEAL WITH THE MANAGING DIRECTOR/DIRECTOR OF THE APPELLANT COMPANY AND UNDER NO STRETCH OF IMAGINATION THIS POWER CAN BE DELEGATED TO AN Y EMPLOYEE OF THE RANK OF GENERAL MANAGER (FIN.) OR DGM(FIN.). THE APPELLANT COMPANY IS A RESIDENT COMPANY AND ALL THE DIRECTORS WERE ALSO RESIDENT IN INDIA. BY A BOARD RESOLUT ION, GENERAL MANAGER (FIN.)/DGM(FIN) WAS DELEGATED WITH THE POWER TO FILE APPEAL BEFORE THE DEPTT. AS DELEGATION OF SUC H POWER IS BEYOND THE PROVISIONS OF THE STATUTE, SUCH DELEGATION IS NOT AS PER THE PROVISION OF THE LAW AND THE APPEAL MEMOS SIGNED AND VERIFIED BY AN EMPLOYEE, NOT BEING THE MANAGING DIRECTOR/DIRECTOR OF THE APPELLANT COMPANY BECAME VOID AB-INITIO. THIS GOES TO THE ROOT OF THE MATTE R I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 5 AND VITIATES THE ENTIRE PROCEEDING. NO COGNITION CAN BE TAKEN ON SUCH APPEAL MEMO AND HENCE ALL THE TWO APPEALS FOR TH E RESPECTIVE ASSESSMENT YEARS STAND REJECTED AND THE A PPEALS FAIL. AS THE ISSUES ARE DECIDED ON FILING OF APPEAL, NO DISCUSSION IS WARRANTED ON THE MERITS OF THE CASE. RELIANC E IS PLACED ON GOLD STONE EXPORTS LTD. V ASSTT. CIT (HYD.) 10 4 ITD 15 (HYD.). IN THAT CASE THE COMMISSIONER (APPEALS) DISMISSED THE ASSESSEE COMPANYS APPEAL WITHOUT GOING INT O ITS MERIT ON THE GROUND THAT THE SAME WAS NOT MAINTAINA BLE IN AS MUCH AS THE APPEAL FORM WAS SIGNED AND VERIFIED BY SENIOR VICE-PRESIDENT (FINANCE) AND NOT BY ITS MANAGING DIRECTOR OR EVEN A DIRECTOR, IN ACCORDANCE WITH THE RELEV ANT PROVISIONS OF THE RULES AND THE ACT. 5. AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 6. THE LD.D.R. PLACES RELIANCE UPON THE IMPUGNED ORDER. I T WAS HER CONTENTION THAT THE MEMO OF APPEAL WHICH WAS FILED BEFORE THE CIT(A) WAS NOT DULY SIGNED AND VERIFIED BY THE AUTHORIZED REPRESENTATIVE IN TERMS OF THE REQUIREMENT OF THE ACT. AS SUCH THE CIT(A) WAS FULLY JUSTIFIED IN DISMISSING THE APPE AL OF THE ASSESSEE. 6.1. LD.D.R. FURTHER CONTENDED THAT THE CIT(A) HAS FOLLOWED THE ORDER O F THE HYDERABAD BENCH OF THE TRIBUNAL IN THE CASE OF GOLDS TONE EXPORT LTD. ON WHICH HEAVY RELIANCE IS BEING PLACED BY THE DEPA RTMENT. ACCORDINGLY THE PRAYER WAS MADE THAT THE ASSESSEES APPEAL BE DISMISSED. 7. HAVING HEARD THE SUBMISSIONS AND PERUSED THE MATERIA L AVAILABLE ON RECORD, WE PROPOSE TO REFORMULATE THE ISSUES WHICH TH E ASSESSEE IS AGITATING VIDE THE GROUNDS RAISED. THE GROUNDS AGITATED BEFORE US HAVE BEEN REPRODUCED IN THE EARLIER PART OF THIS ORDER. THE GR OUNDS MAY BE SUMMED UP BRIEFLY AS UNDER. I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 6 I. THE IMPUGNED ORDER IS ARBITRARY, ILLEGAL AND UNJUST AS THE ASSESEES APPEAL BEFORE THE CIT(A) WAS MAINTAINABLE HAV ING BEEN SINGED BY THE GM(FINANCE) IN TERMS OF POWERS DE LEGATED TO HIM WHICH HAD BEEN APPROVED BY THE BOARD OF DIRECTORS; II. PROVISIONS OF RULE 45(2) C ARE ONLY DIRECTORY BEIN G PROCEDURAL AND NOT MANDATORY AS SUCH GM(FINANCE) WAS EMPOWERED TO SIGN AS SUCH THE APPEAL SHOULD HAVE BEEN DECIDED ON MERIT; III. IN THE ALTERNATIVE IF THE CIT(A) WAS OF THE VIE W THAT THE APPEAL WAS NOT MAINTAINABLE THE OPPORTUNITY TO RECTIFY ITS PROCEDURAL DEFECT SHOULD HAVE BEEN GIVEN. 8. BEFORE WE PROCEED TO ADJUDICATE UPON THE GROUNDS IT IS RELEVANT TO NOTE THAT THE BASIC GROUND FOR APPEAL RAISED BY THE AS SESSEE AS PER THE APPEAL MEMO IS BASED UPON ITS REFERENCE TO THE PROVISIO NS OF RULE 45(2)(C) OF INCOME TAX RULES AS BEING ONLY DIRECTORY AND PR OCEDURAL IN NATURE. IN SO SUBMITTING THE ASSESSEE COMPANY HAS REF ERRED TO AND RELIED UPON A PROVISION RULE 45(2)(C) WHICH IS NO MORE ON THE STATUTE. SUB RULE (2) AS AMENDED BY THE INCOME TAX (THIRD AMENDM ENT) RULES 1976 WITH EFFECT FROM 1.4.1976 ON WHICH RELIANCE APPEARS TO HAVE BEEN PLACED BY THE ASSESSEE IN GROUND NO.2 OF THE APPEAL HAD BEEN SUBSTITU TED BY THE PRESENT SUB RULE (2) OF THE INCOME TAX (5 TH AMENDMENT) RULES 1989 W.E.F. 18.5.1989. IT IS SEEN THAT THE PROVISIONS (A), (B), (C) OF SUB RULE (2) OF RULE 45 PRIOR TO THE ABOVE AMENDMENT IN 1989 WERE SUBSTANTIALLY SIMILARLY WORDED AS S.140 (A), (B), (C) OF THE INCO ME TAX ACT, 1961 AND WERE INTRODUCED BY THE TAXATION LAWS (AM ENDMENT) ACT, 1973 W.E.F. 1.4.1976. AS SUCH RELIANCE PLACED ON THE BELIEF TH AT THE I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 7 PROCEDURAL REQUIREMENT TO BE FULFILLED IS UNDER THE RULES AND NOT UNDER THE PROVISIONS OF THE ACT IS MISPLACED. HOWEVER SINCE THE BASIC ISSUE UNDER CONSIDERATION IS INTERPRETING A REMEDY PROVIDED BY THE STATUTE TO THE ASSESSEE TO FILE AN APPEAL AGAINST THE ASSESSMENT ORDER, AND THE REMEDY IS SO PROVIDED SO THAT TAX PAYER MAY RECOVER , IF SO WARRANTED UNDER THE LAW, TAXES UNJUSTLY COLLECTED, JUST AS THE MENTIONING OF A WRONG SECTION, PROVISION OR RECITAL WILL NOT PER SE INVALIDATE AN ORDER, SIMILARLY THE LEGALITY AND MAINTAINABILITY OF THE APPEAL MUST BE JUDGED WITH REFERENCE TO THE PROVISION UNDER WHICH THE APPEAL W AS ACTUALLY MAINTAINABLE AND MERE RECITAL OF WRONG PROVISION IS NOT MATE RIAL. IN THE FACTS OF THE PRESENT CASE THE ASSESSEE IS AGITATING THE MAINTAINABILITY OF THE APPEAL BEFORE THE CIT(A). AS SUCH SOLELY BECAUSE IN G ROUND NO.2 REFERENCE HAS BEEN MADE TO RULE 45 (2)(C) WHICH NO LONGER EXISTS ON THE STATUTE, WE DO NOT DISMISS THE APPEAL OF THE ASSESSEE OU T RIGHT AND CONSIDER THE GROUNDS RAISED IN THE LIGHT OF THE PROVISIONS AND RULES AS THEY STAND FOR CONSIDERATION. 9. BEFORE WE PROCEED TO ADJUDICATE GROUND NO.1 RAISED B EFORE US, IT IS NECESSARY TO FIRST CONSIDER THE RELEVANT PROVISIONS. THE PROVISION WHICH FALL FOR OUR CONSIDERATION ARE NAMELY SECTION 140 OF THE INCOME TAX ACT, 1961 READ WITH RULE 45 INCOME TAX RULES, 1962. 9.1. THE SAME ARE REPRODUCED HEREUNDER. RETURN BY WHOM TO BE SIGNED : SECTION 140 OF THE INCOME TAX ACT, 1961 : THE RETURN U/S 115 WD OR S.139 SHALL BE SIGNED AND VERIFIED : I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 8 (A ) XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX (B) XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX (C ) IN THE CASE OF A COMPANY, BY THE MANAGING DIRECT OR, THEREOF, OR WHERE FOR ANY UNAVOIDABLE REASON SUCH MANAGING DIRECTOR IS NOT ABLE TO SIGN AND VERIFY THE RETURN, OR WHERE THERE IS NO MANAGING DIR ECTOR, BY ANY DIRECTOR THEREOF: PROVIDED THAT WHERE XXXXXXXXXXXXXXXXXXXXXXX PROVIDED FURTHER THAT : (A) XXXXXXXXXXXXXXXXXXXXX (B) XXXXXXXXXXXXXXXXXXXXX 9.2. WE NOW REPRODUCE RULE 45OF THE INCOME TAX RULES, 1962 WHICH FALLS FOR OUR CONSIDERATION. THE RULE READS AS UNDER. FORM OF APPEAL TO COMMISSIONER (APPEALS) RULE 45 (1)) AN APPEAL TO THE COMMISSIONER (APPEALS) SHALL BE MADE IN FORM NO.35. (2) THE FORM OF APPEAL PRESCRIBED BY SUB-RULE (1), THE GR OUNDS OF APPEAL AND THE FORM OF VERIFICATION APPENDED THERETO RELAT ING TO AN ASSESSEE SHALL BE SIGNED AND VERIFIED BY THE PERSON WHO IS AUTHORI ZED TO SIGN THE RETURN OF INCOME UNDER SECTION 140 OF THE INCOME TAX ACT, 1961, AS APPLICABLE TO THE ASSESSEE. 9.3. ON A CAREFUL READING OF THE PROVISIONS IT IS CLEAR THA T SECTION 140 OF THE INCOME TAX ACT 1961 MANDATES THAT RETURN IN TH E CASE OF A COMPANY SHALL BE SIGNED AND VERIFIED BY THE MANAGING DIRE CTOR OR WHERE FOR ANY UNAVOIDABLE CIRCUMSTANCES MANAGING DIRECTOR IS NOT ABLE TO SIGN AND VERIFY THE RETURN, OR WHERE THERE IS NO MANAGING DIR ECTOR THEN IT MAY BE SIGNED AND VERIFIED BY ANY DIRECTOR THEREOF. APPEALS FILED BEFORE THE CIT(A) AGAINST THE ACTION OF THE A.O. ARE PERMITTED BY SEC. 246/246-A. THE PRESENT APPEAL WAS FILED BEFORE THE CIT(A) U/S 246(1). T HE FORM OF APPEAL AND LIMITATION IS SET OUT U/S 249 OF THE ACT WHICH M ANDATES THAT EVERY APPEAL IN THE SAID CHAPTER NAMELY CHAPTER XX SHALL BE IN THE I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 9 PRESCRIBED FORM AND SHALL BE VERIFIED IN THE PRESCRIBED MAN NER. RULE 45 OF THE TAX RULES, 1962 IN CONFORMITY WITH THE STATUTORY R EQUIREMENTS MANDATES THAT THE SAME SHALL BE IN FORM NO. 35. SUB RULE (2) OF THE SAME FURTHER SETS OUT THAT THE GROUNDS OF APPEAL AND T HE FORM OF VERIFICATION APPENDED THERETO RELATING TO AN ASSESSEE SHA LL BE SIGNED AND VERIFIED BY THE PERSON WHO IS AUTHORIZED TO SIGN THE RETU RN OF INCOME U/S 140 OF THE INCOME TAX ACT 1961 AS APPLICABLE TO THE ASSESSEE. 9.4. THUS AS FAR AS THE ASSESSEE IN THE PRESENT PROCEE DINGS IS CONCERNED BEING A COMPANY THE ONLY COMPETENT PERSON WHO CAN FILE THE GROUNDS OF APPEAL BEFORE THE CIT(A) UNDER HIS SIGNATURE AND VERIFICATION IS THE MANAGING DIRECTOR OR DIRECTOR IN CERTAIN CIRCUMSTAN CES. THE ASSESSEE COMPANY IN THE MEMO OF APPEAL (FORM 35) HAS N OT MET THIS INITIAL REQUIREMENT. THE STATUTE BY THE USAGE OF THE WORDS SHALL BE SIGNED AND VERIFIED DOES NOT LEAVE ANY AMBIGUITY IN REGAR D TO THE INTENTION OF THE LEGISLATURE. 9.5. HAVING THUS EXAMINED THE RELEVANT PROVISIONS WE ARE OF THE VIEW THAT THE FORM NO. 35 MANDATORILY REQUIRES THE SIGNING A ND VERIFICATION BY THE MANAGING DIRECTOR/DIRECTOR. THIS REQUIREMENT HAS NOT BEEN MET. IN THE CONTEXT OF THESE UNASSAILABLE FACTS ON RECORD W E PROCEED TO CONSIDER GROUND NO. 1 MOVED BY THE ASSESSEE. 9.6. BY THE SAID GROUND ON BEHALF OF THE ASSESSEE IT IS AG ITATED THAT THE APPEAL BEFORE THE CIT(A) WAS MAINTAINABLE AS IT HAD BEEN SIG NED BY GM (FINANCIAL) IN TERMS OF THE POWERS DELEGATED TO HIM BY AN INT ERNAL ADMINISTRATIVE RESOLUTION WHICH HAD BEEN APPROVED BY THE BOARD OF DIRECTORS. CONSIDERING THE MERIT OF THE CLAIM IN THE LIGHT OF THE STATUTORY I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 10 PROVISIONS WE HAVE NO HESITATION IN HOLDING THAT THE STAN D OF THE ASSESSEE IS MIS-PLACED, MIS-CONCEIVED AND ILL-ADVISED. 9.7. AN IMPORTANT ASPECT OF THE RULE OF LAW IS THAT GENERA LLY THE COURTS, TRIBUNALS AND THE AUTHORITIES CREATED UNDER SPECIAL STAT UTES ONLY HAVE THOSE POWERS WHICH HAVE BEEN SPECIFICALLY CONFERRED ON TH EM BY SOME POSITIVE LAW. THE CIT(A) THEREFORE IS BOUND BY THE PROVISIO NS OF THE INCOME TAX ACT AND RULES MADE THEREUNDER. THE PROCED URES AND REMEDIES PROVIDED UNDER THE INCOME TAX ACT AND THE RU LES INCLUDING THOSE FOR PREFERRING AN APPEAL BEFORE THE CIT(A) ARE NOT J UST NITTY GRITTY CONSIDERATIONS FOR THE TRIBUNAL. THE PROCEDURES FOR PREFE RRING AN APPEAL ARE PRACTICAL STEPS THAT AN ASSESSEE MUST TAKE TO GE T AN APPEAL HEARD BY THE CIT(A). 9.8. AS DISCUSSED SECTION 140 OF THE INCOME TAX ACT RE AD WITH RULE 45(2) OF THE INCOME TAX RULES ARE THE PROVISIONS TO BE CONSTRUED BY US FOR DECIDING THE ISSUE RAISED IN THE APPEAL. IT IS THE FIRST PRINCIPLE OF INTERPRETATION THAT A STATUTE SHOULD BE READ IN ITS OR DINARY NATURAL AND GRAMMATICAL SENSE AS OBSERVED BY THE HONBLE SUPREME C OURT OF INDIA IN M/S HIRALAL RATHANLAL VS. STO IN AIR 1034 IN CONSTRUING A STATUTORY PROVISION THE FIRST AND FORE MOST RULE OF CONSTRUCTION IS THE LITERARY CONSTRUCTION. ALL THAT THE COURT HAS TO SEE AT THE VERY OUTSET IS WHA T DOES THE PROVISION SAY. IF THE PROVISION IS UNAMBIGUOUS AND IF FROM THE PROVISION THE LEGISLATIVE INTENT IS CLEAR, THE COURT NEED NOT CALL INTO IT THE OTHER RULES OF CONSTRUCT ION OF STATUTES. THE OTHER RULES OF CONSTRUCTION ARE CALLED INTO AID ONLY WHEN THE LEGISLATIVE INTENT IS NOT CLEAR. 9.9. IN THE FACE OF CLEAR CUT STATUTORY REQUIREMENTS CE RTAIN PROCEDURAL STEPS ARE TO BE PERFORMED/FULFILLED BEFORE THE APPEAL CAN BE TAKEN UP FOR I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 11 ADJUDICATION. THE INTERNAL ADMINISTRATIVE RESOLUTION EVEN WH EN APPROVED BY THE BOARD OF DIRECTORS EVEN IN THE CASE OF A COMPAN Y WHICH IS A GOVERNMENT UNDERTAKING CANNOT CIRCUMVENT THE STATUTO RY REQUIREMENTS. THE PROCEDURES ARE LAID DOWN SO AS TO ASSIST IN THE RENDERING OF JUS TICE. 9.10. THE ASSESSEE WHO MOVES AN APPEAL UNDER THE INCO ME TAX ACT BEFORE THE CIT(A), WHO IS CREATED BY THE SAME STATUE IN ORDER TO SEEK ADJUDICATION UPON THE MERITS OF THE GROUNDS OF APPEAL RAI SED BEFORE IT U/S 246 OF THE INCOME TAX ACT CANNOT DICTATE TO THE S AID AUTHORITY THAT THE INTERNAL ADMINISTRATIVE PROCEDURE, THOUGH OF A GOVER NMENT UNDERTAKING, MUST BOW TO THE PROCEDURAL REQUIREMENTS SET OUT UNDER THE RULES UNDER THE INCOME TAX ACT, 1961. THE CIT(A)S ACTION IN HOLDING THAT DISMISSING THE APPEAL OF THE ASSESSEE IS NOT MAINTAINA BLE FOR WANT OF SIGNATURE OF THE COMPETENT PERSON IS FULLY IN CONSONA NCE WITH THE SETTLED LEGAL PRINCIPLES AND CANNOT BE FAULTED WITH. THE ASS ESSEE CANNOT ARROGATE TO ITSELF THE POWER TO DICTATE THAT THE BOARD RESOLUTION SHOULD BE ALLOWED TO CIRCUMVENT THE STATUTE UNDER WHICH HE SE EKS A REDRESSAL. THE TIME TESTED PROCEDURES WHICH HAVE BEEN SET OUT IN THE RELEVANT PROVISIONS CANNOT BE CIRCUMVENTED AT THE ILL ADVISED WHIMS OF THE ASSESSEE AND IT IS IN THE ASSESSEES OWN SELF INTEREST T HAT THEY ARE NOT ALLOWED TO BE CIRCUMVENTED. 9.11. THE ASSESSEE IN THE PRESENT PROCEEDINGS IS A COM PANY AND NOT GM(FINANCE), BOARD OF DIRECTORS OR FOR THAT MATTER M.D. THE ASSESSEE IS IN THE PROCEEDINGS BEFORE THE CIT(A) THE COMPANY AND THE GM (FINANC E) UNDER THE STATUTORY PROVISIONS OF THE ACT UNDER WHICH REDRESSAL IS SOUGHT BY THE ASSESSEE CANNOT SIGN AND VERIFY FORM NO . 35 AND THE CIT(A)S ACTION IS FULLY SUPPORTED BY THE ORDER OF THE CO- ORDINATE BENCH OF HYDERABAD. WHILE SO HOLDING WE OBSERVE THAT ALTHOUGH THE BOARDS CIRCULAR IS NOT BEFORE US HOWEVER THE CIT(A) HAS GIVEN A FIN DING OF FACT THAT AT THE RELEVANT POINT OF TIME THE DIRECTORS WERE A VAILABLE. THE I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 12 DELEGATION OF POWERS VESTED CONTRARY TO THE STATUTORY REQUIREMENT CANNOT BE ACCEPTED AND THE CIT(A) WAS FULLY JUSTIFIED IN DISMISSING T HE APPEAL OF THE ASSESSEE AS NON-MAINTAINABLE FOR WANT OF NECESSARY V ERIFICATION AND SIGNING OF THE COMPETENT PERSON. 9.12. THE PLEA WHICH MAY BE TAKEN THAT GM (FINANCE) WOU LD BE BY VIRTUE OF HIS SPECIALTY AND EXPERTISE IN TAX AND FINANCIAL MA TTERS WOULD BE FULLY CONVERSANT, RESPONSIBLE AND MORE CONSCIOUS OF THE IMPLICAT IONS AND AS SUCH A RESPONSIBLE PERSON FOR THE ASSESSEE COM PANY HOLD GOOD AS IT IS A UNIVERSALLY SETTLED LEGAL POSITION THAT THE COMPA NY BEING AN ARTIFICIAL JURIDICAL PERSON IS RESPONSIBLE FOR ALL ITS CIVIL, CRIMINAL OR TAX RELATED ACTS THROUGH ITS M.D. OR DIRECTOR AS IT MAY BE. T HE RESPONSIBILITY SO FIXED IS IN THE BETTER INTEREST OF THE ASSESSEE ITSELF A S THE LAWS OF THE LAND HOLD THE M.D./DIRECTOR RESPONSIBLE FOR ALL ACTS OF OMIS SION OR COMMISSION OF THE COMPANY IN CIVIL, CRIMINAL OR TAXATION MATT ERS. THE MD / DIRECTOR AS IT MAY BE IS THE FINAL INTERFACE OF THE C OMPANY WITH THE WORLD AT LARGE AND THE LAWS OF THE LAND HOLD HIM RESPO NSIBLE AND ACCOUNTABLE. THUS DELEGATION OF THIS ONEROUS RESPONSIBILITY C ONTRAVENING THE STATUTORY REQUIREMENTS OF THE INCOME TAX ACT IN TH E PRESENT PROCEEDINGS CANNOT BE ACCEPTED AS IT IS AGAINST THE LAW. 9.13. BEFORE PARTING WE MAY REITERATE THAT THE RESPONS IBILITY SO FIXED IS IN THE BETTER INTEREST OF THE ASSESSEE ITSELF AS THE ASSE SSEE AT THE HIGHEST RESPONSIBLE AND ACCOUNTABLE POSITION IS FULLY AWARE AND PAR TICIPATES IN THE PROCEEDINGS WHERE HUGE TAX LIABILITIES AFFECTING THE PERFO RMANCE OF THE COMPANY ARE AT STAKE. 9.14. IN THE FACE OF NO OTHER FACT EXCEPT THE BOARDS R ESOLUTION THE CIT(A)S ACTION IN DISMISSING THE APPEAL IN LIMINE FOR WANT OF N ECESSARY SIGNATURES OF THE COMPETENT PERSON, CANNOT BE QUASHED ON THE GROUNDS OF BEING ARBITRARY AS THE SAID AUTHORITY HAS ACTED IN ACC ORDANCE WITH LAW I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 13 AND WITHOUT ARBITRARINESS. THE ACTION OF THE SAID AUTHOR ITY ALSO CANNOT BE SET ASIDE ON THE GROUND OF BEING ILLEGAL AS NO ILLEGALITY IS BROUGHT OUT NOR IS IT CONTRARY TO THE PROVISIONS OF LAW AS CIT(A) HAS FOLLOWED THE LAW AND APPLIED THE PRINCIPLE LAID DOWN IN THE ORDER OF THE HIGHE R FORUM I.E. THE HYDERABAD BENCH OF THE TRIBUNAL. ACCORDINGLY GROUND NO. 1 OF THE ASSESSEE IS REJECTED. 10. BY GROUND NO. 2 IT IS AGITATED THAT THE PROVISIONS O F RULE 45(2)(C) ARE DIRECTORY AND BEING PROCEDURAL ARE NOT MANDATORY; THE SIGNING HAVING BEEN DONE BY THE GM (FINANCE) THE APPEAL SHOULD H AVE BEEN DECIDED ON MERITS. THE SAID RULE AS DISCUSSED ON THE EAR LIER PART OF THIS ORDER HAS BEEN AMENDED AS SUCH REFERENCE TO THE SAME IN THE GROUND IS CONSIDERED IN THE LIGHT OF SEC.140 OF THE INCOME TAX ACT R EAD WITH RULE 45(2) OF THE INCOME TAX RULES. 10.1. CONSIDERING THE MERITS OF THE ARGUMENTS ADVANCED IN THE SAID GROUND WE ARE OF THE VIEW THAT IT CANNOT BE DISPUTED T HAT RULE 45 IS A PROCEDURAL RULE AND PROVIDES THE FORM IN WHICH THE APPEAL IS TO BE MADE AND WHO IS THE COMPETENT PERSON TO SIGN THE VERIFICATION APPENDED TO THE APPEAL. 10.2. IN THE CASE OF THE ASSESSEE COMPANY IT IS THE MA NAGING DIRECTOR OR ANY DIRECTORS THEREOF IN CERTAIN CIRCUMSTANCES AS HAS BE EN DISCUSSED WHILE CONSIDERING THE SAID RULE IN THE EARLIER PART OF THIS O RDER. THE APPEAL BEFORE THE CIT(A) HAS TO BE FILED IN FORM 35 OF APPE NDIX II OF THE IT RULES 1962. IN ACCORDANCE WITH THE PRESCRIBED FORM THE APPEAL IS TO BE SIGNED BY THE AUTHORIZED AND RESPONSIBLE PERSON WHO R EPRESENT THE COMPANY. AS OBSERVED UNDER THE LAWS OF THE LAND AND FOR THAT MATTER IT IS A UNIVERSAL SETTLED LEGAL PRINCIPLE QUA THE COMPANY THAT THAT THE MD/DIRECTOR IS THE PERSON HAVING THE ULTIMATE RESPONSIBILIT Y IN CIVIL, CRIMINAL AND TAXATION LIABILITIES. THE GM (F) EVEN WHEN AUTHORIZE D BY I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 14 INTERNAL ADMINISTRATIVE RESOLUTION DULY APPROVED BY THE BO ARD OF DIRECTORS IS STILL NOT THE AUTHORIZED PERSON UNDER RULE 45 TO SIGN AND VERIFY FORM NO. 35. AS SUCH THE CIT(A) WAS FULLY JUSTIFIED IN NOT PROCEEDING TO ADJUDICATE UPON THE POINTS AT ISSUE ON MERIT AND DISMISS THE APPEAL IN LIMINE FOR WANT OF SIGNATURE VERIFYING FORM NO. 35 AND SIGNATURES OF MD ON THE GROUNDS OF APPEAL AGITATED AS SUCH GROUND NO. 2 IS ALSO REJECTED. 10.3. BEFORE PARTING WE AGAIN EMPHASIS THE RIGHT TO APPEA L UNDER THE INCOME TAX ACT 1961 AGAINST THE ASSESSMENT ORDER IS G IVEN ONLY TO THE ASSESSEE, IN ORDER TO ENSURE THAT THE ASSESSEE IS NOT VISITED UPON BY ANY ADVERSE ACTION AT THE APPELLATE STAGE WITHOUT HIS KNOWLED GE. IT HAS BEEN ENSURED BY SECTION 140 OF THE ACT READ WITH RULE 45 T HAT THE ONLY PERSON WHO CAN SIGN THE GROUNDS OF APPEAL AND THE VERIFIC ATION IN FORM NO. 35 IS THE VERY SAME PERSON AS THE ONE WHO FILES THE RETURN AS AN ASSESSEE UNDER HIS OWN SIGNATURE. THE AUTHORIZED PERSON WHO CAN FILE THE RETURN IN THE CASE OF THE ASSESSEE COMPANY IS THE MD/DIRECTOR AS SUCH FORM NO. 35 NECESSARILY IN THE INTERESTS OF THE ASS ESSEE COMPANYS OWN SELF INTEREST HAS TO BE SIGNED BY THE MD/DIRECTOR. TH E FACT THAT MD/DIRECTOR IS UNIVERSALLY ACCEPTED TO BE THE RESPONSIB LE PERSON FOR THE ACT OF OMISSION AND COMMISSION OF THE COMPANY IS A WELL SET TLED LEGAL PRINCIPLE LEAVING NO SCOPE TO ARGUE WITH. 10.4. THE PRESENT CASE IS THEREFORE A CLEAR CASE OF JURIS DICTIONAL ERROR OF FACT WHERE ON BEHALF OF THE ASSESSEE COMPANY THE RELIANCE IS BEING PLACED UPON THE ADMINISTRATIVE DECISIONS OF THE MANAGEMENT. THE ASSESSEE COMPANY HAS MISTAKENLY ASSUMED THAT IT HAD THE POWE RS TO DELEGATE THE POWER TO FILE AN APPEAL UPON THE DG (F) THEREBY GIVING TO IT SELF EXTRA POWERS NOT PROVIDED BY THE INCOME TAX ACT. THE EXERC ISE OF POWER OR JURISDICTION DEPENDS UPON THE PRECEDENT ESTABLISHMENT OF AN OBJECTIVE FACT. THIS PRECEDENT REQUIREMENT INCLUDES THE REQUIREMENT TO FOLLOW THE I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 15 PROCEDURAL REQUIREMENT AS IN THE PRESENT CASE OF THE AP PEAL BEING FILED BEFORE THE CIT. THE ADMINISTRATIVE AUTHORITY CANNOT INCRE ASE ITS POWER BY MISTAKENLY THINKING THAT IT ALSO HAS THE POWER TO DE CIDE THE AUTHORITY EMPOWERED TO FILE AN APPEAL BEFORE THE CIT(A) WHICH IT DOES NOT. 10.5. SEC.140 OF THE ACT READ WITH RULE 45(2) IS WORDED IN SUCH A MANNER THAT THE PROCEDURAL REQUIREMENT IS A MANDATORY REQUIREMENT . THE PREVALENT LARGELY CONSISTENT JUDICIAL VIEW WHICH WE SH ALL DISCUSS IN DETAIL IN THE LATER PART OF THIS ORDER WHILE CONSIDERING IDENTICAL PROCEDU RAL REQUIREMENTS THE COURTS HAVE NO DOUBT HELD THAT DESP ITE THE WORDING WHICH MAKES IT MANDATORY THE REQUIREMENTS HAVING BEEN C ONSTRUED AS A PROCEDURAL REQUIREMENT AS SUCH IS CURABLE. THE DEFECT IS NOT AN INCURABLE DEFECT BUT A RECTIFIABLE DEFECT. THE LIBERAL INTERPRE TATION SO GIVEN DOES NOT MEAN THAT BEING PROCEDURAL THE DEFECT IS TO BE IGNORED. THE CORRECT AND ONLY INTERPRETATION IS THAT BEING PROC EDURAL IT IS A CURABLE. AS SUCH THE EMPHASIS ON THE GROUND THAT BEING DIRECTORY AS SUCH BEING PROCEDURAL IS NOT MANDATORY AND GM(FINANCE) W AS EMPOWERED TO FILE AS SUCH THE CIT(A) ERRED IN NOT DECIDING ON MERITS IS MIS READING THE CASE LAW AND CONTRARY TO THE SETTLED LEGAL POSITION. IT CANNOT BE SAID THAT THE COURTS HAVE WAIVED THE SAID R EQUIREMENT INTO OBLIVION. THEY HAVE MERELY OBSERVED THAT NON PERFORMAN CE OR NON FULFILLMENT OF THE PROCEDURAL REQUIREMENTS OF THE RULES CAN BE CURED. 10.6. THE PROCEDURAL REQUIREMENT CANNOT BE IGNORED AS THEY ARE IN THE BEST INTERESTS OF THE ASSESSEE ITSELF AS BY ENSURING THAT ONLY THE AUTHORIZED PERSON PERFORMS THESE RESPONSIBLE TASKS THE ASSESSEE IS NECESSARILY AT THE HIGHEST AND ACCOUNTABLE LEVEL KEPT FU LLY INFORMED ABOUT THE LIABILITY WHICH MAY BE FASTENED UPON THE ASSESSE E. THE RIGHT TO APPEAL CONFERRED UPON THE ASSESSEE MUST BE EXERCISE D THROUGH THE PERSON WHO IS AUTHORIZED TO SIGN THE RETURN AND THE ON LY PERSON WHO UNDER LAW CAN PARTICIPATE ON BEHALF OF THE ASSESSEE WHO IS A COMPANY IS I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 16 A MANAGING DIRECTOR/DIRECTOR IN CERTAIN CASES WHO TAKES FULL RESPONSIBILITY ON BEHALF OF THE COMPANY ON THE TAX LIABILITY TH OUGH PROCEDURAL IS MANDATORY AND REQUIRED TO BE CURED. 10.7. THE IMPORTANCE OF IT WHEREBY TAX LIABILITY MAY BE FASTE NED UPON AN ASSESSEE IN THE BEST INTERESTS OF THE ASSESSEE ITSELF CAN NOT BE DISREGARDED AND THE AUTHORIZED PERSON AS SUCH IS NECESSARILY THE P ERSON WHO IS TO SIGN AND VERIFY THE RETURN/APPEAL MEMO ALONG WITH THE G ROUNDS BEFORE THE CIT(A) U/S 140 OF THE INCOME TAX ACT READ WITH RULE 45(2) OF THE I.T.RULES. . AS SUCH GROUND NO.2 OF THE ASSESSEE IS DISMISSED. 11. WITHOUT PREJUDICE TO THE ABOVE GROUNDS THE ASSESS EE HAS ALSO AGITATED VIDE GROUND NO. 3 THAT IF IT IS TO BE HELD THAT T HE CIT(A) WAS CORRECT IN FORMING THE VIEW THAT THE APPEAL WAS NOT MAINT AINABLE THEN OPPORTUNITY TO RECTIFY THE PROCEDURAL DEFECT SHOULD HAVE BEEN GIVEN BY THE CIT(A). 11.1. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT OPPORT UNITY WAS GIVEN VIDE LETTER DATED 1.7.2010 WITH CORRIGENDUM DATED 30.8.201 0 ASKING FOR THE CLARIFICATION. EXTRACT OF THE SAID LETTER IS FOUND ATTACHE D AT PAGES 3 & 4 OF THE IMPUGNED ORDER. THE ASSESSEES REPLY THERETO DATED 22.10.10 IS ALSO FOUND REPRODUCED AT PAGE 4 RELEVANT EXTRACTS ADDR ESSING THE ISSUE UNDER CONSIDERATION HAVE BEEN REPRODUCED IN THE EARLIER PART OF THIS ORDER. ON CONSIDERATION OF THE SAME IT CANNOT BE SAID TH AT THE FACT OF DEFECT WAS NOT CONFRONTED TO THE ASSESSEE COMPANY. THE RELEVANT PROVISION WAS SPECIFICALLY CONFRONTED BY THE CIT(A) REQUIRING THE ASSESSEE TO SHOW HOW THE APPEAL WAS NOT MAINTAINABLE. TH E ASSESSEE WOULD HAVE BEEN WELL ADVISED TO PROMPTLY RECTIFY THE DE FECT AT THAT STAGE. THE MERITS OF SUCH AN ACTION CANNOT BE OVEREMPHASIZED. H OWEVER THE ASSESSEE CHOSE TO OBDURATELY INSIST UPON THE CORR ECTNESS OF THE I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 17 PROCEDURES FOLLOWED GIVING GREATER SANCTITY TO THE PROCE DURES FOLLOWED BY THE ASSESSEE COMPANY BY VIRTUE OF WHICH POWERS WERE D ELEGATED TO THE GM (FINANCE) IS UNFORTUNATELY ILL ADVISED. WE ARE CALLED UPON TO STATE IN UNAMBIGUOUS WORDS THAT INTERNAL ADMINISTRATIVE PROCEDURE S RUNNING / FLOUTING THE STATUTORY PROCEDURAL REQUIREMENTS CAN NOT CURE THE DEFECT OF SIGNING AND VERIFYING BY THE COMPETENT PERSON. THE DEFECT CAN BE CURED ONLY BY SIGNATURES OF THE MD OR DIRECTOR AS MAY BE APP LICABLE. THE RELIANCE PLACED UPON INTERNAL ADMINISTRATION PROCEDURES IS A S SUCH MISPLACED. 11.2. HAVING THUS OBSERVED CONSIDERING THE SPECIFIC GROUND NAMELY GROUND NO. 3 THE FACT REMAINS THAT THE ASSESSEE BY THE SAID GROUND S EEKS TO CANVASS THAT HAD THE OPPORTUNITY BEEN GIVEN THE DEFECT WOULD HAVE BEEN CURED. 11.3. AS WE HAVE DISCUSSED EARLIER THE FACT OF APPEAL NOT CONFIRMING TO THE STATUTORY REQUIREMENTS AND THE RULES HEREUNDER WA S BROUGHT TO THE NOTICE OF THE ASSESSEE AND ITS EXPLANATION / CLARIFICATION WA S SOUGHT. THE ASSESSEE HAVING RENDERED ITS EXPLANATION CANNOT BE DOUB TED TO HAVE A BONAFIDE BELIEF THAT IF THE EXPLANATION IS NOT SATISFACTORY TH EN OPPORTUNITY TO RECTIFY THE DEFECT WOULD BE GIVEN. AS THE GROUND UNDER CONSIDERATION BEARS OUT THIS BONAFIDE BELIEF WHICH MAY HAVE BEEN ENTERTAINED. AS SUCH THE PLEA PUT UP THAT IN THE EVEN TUALITY THE EXPLANATION OFFERED WAS NOT ACCEPTED THE CIT(A) WOULD GRAN T A SPECIFIC OPPORTUNITY TO RECTIFY THE DEFECT IS VERY MUCH WITHIN PLAU SIBLE BELIEFS AND IS NOT A FAR-FETCHED CLAIM. THE EXPECTATION OF THE ASSESSEE CANNOT BE SAID TO BE AN IMPOSSIBLE AND UNREALISTIC EXPECTATION. WE ARE INC LINED TO SO HOLD AS IT IS A SETTLED LEGAL PROPOSITION THAT IF ANY ORDER B Y A JUDICIAL OR A QUASI-JUDICIAL AUTHORITY OR FOR THAT MATTER AN ADMINISTRAT IVE AUTHORITY IS PASSED WHICH IS ADVERSE TO THE PARTY, IMPLICITLY BY READIN G THE RULES OF NATURAL JUSTICE INTO IT A RESPONSIBILITY IS CAST ON THE AUT HORITY PASSING THE I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 18 ORDER TO GIVE A REASONABLE OPPORTUNITY OF CORRECTING TH E DEFECT. THE SAME IS EMBEDDED IN THE RIGHT TO BE HEARD AS A HEARING PRE S UPPOSES ON AN ISSUE LIKE THIS THAT IF THE CIT(A) WAS NOT SATISFIED WITH THE EXPLANATION THE ASSESSEE WAS NECESSARILY REQUIRED TO BE GIVEN A REASONABLE OPPO RTUNITY TO RECTIFY THE DEFECT. TO HOLD OTHERWISE WOULD MEAN THAT TH E OPPORTUNITY OF BEING HEARD GIVEN TO THE ASSESSEE WAS ONLY A PRE GO NE PRE CLOSED ISSUE. THE AUTHORITY CANNOT BE SAID TO HAVE ACTED IN SUCH A M ANNER. THE ASSESSEE WHEN CALLED UPON TO EXPLAIN/CLARIFY MAY ENTERTAIN A BELIEF THAT IF THE EXPLANATION IS NOT ACCEPTED HE WILL BE GIVEN OPPORTUN ITY TO MAKE GOOD THE DEFECT. THERE MAY BE OCCASIONS WHERE AT A POINT OF TIME THE MEMO OF APPEAL MAY HAVE BEEN SIGNED BY ANY OTHER PERSO N WHO IN THE EYES OF LAW IS NOT AUTHORIZED TO SO SIGN. THE SAID SITUA TION MAY HAVE ARISEN ON ACCOUNT OF THE FACT THAT THERE BEING NO COMPE TENT PERSON AT THE POINT OF TIME WHERE THE SIGNING AND VERIFYING IS DONE IN ORD ER TO ENSURE THAT LIMITATION DOES NOT EXPIRE. AS SUCH THE ASSESSEE MA Y BE ASKED TO EXPLAIN AND CLARIFY THE POSITION. WRONG BONAFIDE BELIEF ON TH E PART OF THE ASSESSEE ON CONSIDERATION NECESSARILY CANNOT BE ACCEPT ED. HOWEVER OPPORTUNITY TO RECTIFY THE DEFECTS IS TO BE GIVEN. 12. WE NOW PROPOSE DISCUSS AT LENGTH THE LEGAL POSITION ON THE ISSUE OF SIGNING AND VERIFYING THE APPEAL FORM AND GROUNDS WHEREIN THE COURTS HAVE BEEN SEIZED OF SUCH ISSUES. A PERUSAL OF THE FOLLOWING WOULD SHOW THAT THE SETTLED LEGAL POSITION WHICH EMERGES FROM A STUDY OF THESE IS THAT THE DEFECT IS A RECTIFIABLE/CURABLE DEFECT AND DOES NOT AMOUNT TO ILLEGALITY AND INSTEAD IS ONLY AN IRREGULARITY. 12.1. WE FIRST PROPOSE TO CONSIDER THE JUDGEMENT OF THE ORISSA HIGH COURT IN THE CASE OF ACIT VS. K.PADMALOCHAN SAHU (1974 ) 95 ITR 113 I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 19 (ORISSA) WHEREIN RELATING TO A MATTER WHERE THE MEMORANDU M OF APPEAL WAS NOT SIGNED BY A KARTA OR A MEMBER OF HUF AS SUCH SHOULD THE APPEAL BE REJECTED OR NOT , THE COURT HELD AS UNDER. THE DIFFERENCE BETWEEN THE AAC AND THE TRIBUNAL LIE S WITHIN A NARROW CAMPUS PURELY IN THE MATTER OF EXERCISE OF DISC RETION. THE FIRST APPELLATE AUTHORITY GAVE ONE CHANCE FOR REC TIFICATION, AND ON THE FAILURE THEREOF THE APPEAL WAS DISMISSED. THE TRIBUNAL, HOWEVER, WAS OF THE OPINION THAT A FURTHER OPPORTUNITY SHOULD BE GIVEN FOR RECTIFICATION AS ON TH E SECOND OCCASION THE ASSESSEE COMMITTED ANOTHER MISTAKE BY N OT GETTING THE MEMORANDUM OF APPEAL SIGNED BY THE KARTA , BUT BY HIS SON. THIS BEING A MATTER OF DISCRETION, THE T RIBUNAL IS TO EXERCISE IT AS IT THINKS PROPER AS THE LAST COURT OF FACT. STRICTLY SPEAKING, THE QUESTION REFERRED TO US SHOU LD NOT HAVE BEEN REFERRED. AS, HOWEVER, THE QUESTION HAS ALREADY B EEN REFERRED WE ANSWER IT BY SAYING THAT THE FIRST PART WOULD BE ANSWERED IN THE NEGATIVE AND THE SECOND PARTY BY SA YING THAT THE DEFECT WAS AN ILLEGALITY, BUT SUCH DEFECT SHOULD BE ALLOWED TO BE RECTIFIED BY GIVING PROPER OPPORTUNITY TO THE ASSESS EE. 12.2. REFERENCE MAY ALSO BE MADE TO THE JUDGEMENT OF T HE HONBLE CALCUTTA HIGH COURT IN THE CASE OF SHEONATH SINGH VS CIT (1958) 33 ITR 591 (CAL.), WHEREIN THEIR LORDSHIPS OF HAVE HELD IN SOME WH AT SIMILAR CIRCUMSTANCES : THE ABSENCE OF OR DEFECT IN THE SIGNATURE OF THE AP PELLANT IN THE MEMORANDUM OF APPEAL WAS NOT AN ILLEGALITY OR FATAL BUT ONLY AN IRREGULARITY WHICH COULD BE RECTIFIED BY AMEND MENT, THE AMENDMENT TAKING EFFECT FROM THE DATE WHEN THE DOCUMENT HAD ORIGINALLY BEEN FIELD. THE MEMORANDUM AS I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 20 ORIGINALLY FILED WERE NOT NULLITIES AND THE TRIBUNAL HAD POWER TO ACCEPT THEM IN THE CONDITION IN WHICH THEY FOUND THEM AT THE TIME THEY WERE HEARING THE APPEAL PROVIDED THEY W ERE SATISFIED THAT THE ASSESSEE HAD IN FACT INTENDED TH E APPEAL TO BE PLACED BEFORE THEM AND HAD DONE SO THROUGH THE AUTHORISED REPRESENTATIVE ALTHOUGH HE HAD NOT HIMSEL F SIGNED THE MEMORANDUM. THE TRIBUNAL WAS, THEREFORE, WRONG IN HOLDING THAT THE ABSENCE OF THE SIGNATURE OF THE APP ELLANT AT THE PROPER PLACES IN THE MEMORANDUM OF APPEAL WAS A MATERIAL DEFECT WHICH PREVENTED THEM FROM ACCEPTING TH E DOCUMENT AS GOOD AND THAT ALTHOUGH THE DEFECTS HAD SUBSEQUENTLY BEEN REMOVED, THE PERIOD OF LIMITATION HAV ING MEANWHILE EXPIRED THE REMOVAL WAS OF NO ASSISTANCE TO THE ASSESSEE. 12.3. IT CAN ALSO BE SEEN THAT THEIR LORDSHIPS OF THE GU JARAT HIGH COURT WERE SEIZED OF SOMEWHAT SIMILAR FACTS IN THE CASE OF RAJEND RA KUMAR MANIKLAL SHEITH (HUF) VS CIT REPORTED IN 213 ITR 715 (GUJAR AT) . THE LORDSHIPS THEREIN REVERSED THE ACTION OF THE TRIBUNAL AND UPHELD THE ACTION OF THE APPELLATE ASST.COMMISSIONER IN EXERCISING HIS DIS CRETION BY WAY OF WHICH THE SAID AUTHORITY ALLOWED THE ASSESSEE IN AP PEAL PERMITTED THE ASSESSEE TO SUBMIT A REVISED APPEAL IN FORM NO.35 DU LY SIGNED BY HIM SO AS TO OVERCOME THE HURDLE THAT THE MEMO OF APPE AL ORIGINALLY FILED DID NOT CARRY THE SIGNATURE OF THE APPELLANT AS IT WAS S IGNED BY SOMEBODY ELSE. BEFORE THE CIT(A) IT WAS CONTENDED BY T HE ITO VIDE HIS WRITTEN SUBMISSIONS THAT THE APPEAL WAS NOT PROPERLY FILE D BY THE ASSESSEE AS IT DID NOT BEAR HIS SIGNATURE. TO THE SAID O BJECTION THE ASSESSEE INTIMATED THAT THE APPEAL FORM REALLY BORE HIS SIGNATURE AND EVEN IF THE APPEAL FORM WAS NOT SIGNED BY HIM HE SHOULD B E PERMITTED TO SIGN A REVISED FORM WHICH WAS DULY DONE ALONG WITH CO NDONATION OF DELAY PETITION. CONSIDERING VARIOUS DECISIONS OVER RULING THE ITOS OBJECTIONS THE APPEAL WAS ADMITTED, DELAY CONDONED AND A LLOWED ON I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 21 MERITS. THE TRIBUNAL DID NOT UPHOLD THE ACTION AND REMAND ED THE ISSUE FOR VERIFICATION OF THE SIGNATURE BACK TO THE CIT(A). 12.3.1. THEIR LORDSHIPS HELD THAT THE APPELLATE ASST.COMMIS SIONER EXERCISED HIS DISCRETIONARY JURISDICTION AND HAS CONDONED THE DELAY AND HAD ADMITTED THE APPEAL FOR ADJUDICATION ON THE MERITS U/ S 249(3) OF THE INCOME TAX ACT, 1961. THE LORDSHIPS WERE PLEASED TO H OLD THAT FOR CONDONATION OF DELAY THE SAID AUTHORITY HAS CONSIDERED TH E FACTS STATED BY THE APPELLANT AND ALSO THE CASE LAWS CITED BEFORE HIM. FURTHER BY ADMITTING THE APPEAL FOR ADJUDICATION ON MERITS THEIR LORDSHIPS HELD THAT THE DEPARTMENT IS NOT LIKELY TO SUFFER ANY LOSS OR PREJUD ICE. HENCE IT COULD NOT BE SAID THAT THE DISCRETIONARY POWER EXERCISED BY THE APPELLATE AUTHORITY INCLUDING THE SO CALLED IRREGULARITY WITH REGARD T O SIGNATURE ON THE APPEAL MEMO CALLS FOR ANY INTERFERENCE BY THE TRIBUNAL PARTICULARLY WHEN THE FRESH APPEAL MEMO DULY SIGNED BY THE APPELLANT WAS SUBMITTED BEFORE IT. 12.4. AT THIS STAGE, IT MAY BE APPROPRIATE TO REFER TO SIMILAR PROVISIONS O F THE CODE OF CIVIL PROCEDURE. IN TERMS OF 0.6 RR 14 AND 1 5, THERE IS AN OBLIGATION UPON THE PLAINTIFF TO SIGN AND VERIFY THE PLAINT BY A DULY AUTHORIZED PERSON. IN THE EVENT OF SUCH SIGNING AND VER IFICATION IS DEFECTIVE, EITHER FOR WANT OF AUTHORITY OR ON SUCH SIMILAR GR OUNDS, IN THAT EVENT, IT WOULD NOT BE PROPER TO REJECT A PLAINT UNDER T HE PROVISIONS OF O. 7, R.11 OF THE CPC, BUT AN OPPORTUNITY SHOULD BE PROVIDED TO THE PLAINTIFF TO CORRECT THE DEFECT SO THAT SUBSTANTIVE DISPUTE BETW EEN THE PARTIES CAN BE DECIDED. IN THE CASE OF UNITED BANK OF INDIA VS NARE SH KUMAR AND ANOTHER 1996 (6) SCC 660, THEIR LORDSHIPS OF THE APEX COU RT WHILE REFERRING TO THE LAW OF PRACTICE AND PROCEDURE CONSIDERING THE OBJECTION I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 22 THAT THE PLAINT WAS NOT SIGNED AND VERIFIED IN ACCORDANC E WITH LAW BY A DULY AUTHORIZED PERSON. THE SUIT HAD BEEN DISMISSED BY THE COURTS BELOW THEIR LORDSHIPS SITTING IN THE SUPREME COURT HELD : PROCEDURAL DEFECTS WHICH DO NOT GO TO THE ROO T OF THE MATTER SHOULD NOT BE PERMITTED TO DEFEAT A JU ST CAUSE. THERE IS SUFFICIENT POWER IN THE COURTS, UNDE R THE CODE OF CIVIL PROCEDURE, TO ENSURE THAT INJUSTICE IS NOT DONE TO ANY PARTY WHO HAS A JUST CASE. AS FAR AS POSSIBLE A SUBSTANTIVE RIGHT SHOULD NOT BE ALLOWED TO BE DEFEATED ON ACCOUNT OF A PROCEDURAL IRREGULARITY WHICH IS CURABLE . THEY FURTHER OPINED AS UNDER. IF, FOR ANY REASON WHATSOEVER, THE COURTS BELOW WERE STILL UNABLE TO COME TO THIS CONCLUSION, THEN EITHER OF THE APPELLATE COURTS OUGHT TO HAVE EXERCIS ED THEIR JURISDICTION UNDER O. 41, R. 27(1) (B) OF THE CPC AND S HOULD HAVE DIRECTED A PROPER POWER OF ATTORNEY TO BE PROD UCED OR THEY COULD HAVE ORDERED SHRI L.K. ROHATGI OR ANY OTHER COMPETENT PERSON TO BE EXAMINED AS A WITNESS IN ORD ER TO PROVE RATIFICATION OR THE AUTHORITY OF SH. L.K.ROHATGI TO SIGN THE PLAINT. SUCH A POWER SHOULD BE EXERCISED BY A CO URT IN ORDER TO ENSURE THAT INJUSTICE IS NOT DONE BY REJEC TION OF A GENUINE CLAIM. 12.5. SUBSTANTIAL COMPLIANCE TO THE RULES OF PROCEDURE HA S NORMALLY BEEN ACCEPTED BY THE COURTS AND CONSISTENT VIEW APPEA RS TO BE THAT THE DOORS OF ADJUDICATION SHOULD NOT BE SHUT ON AN APPLICANT AT THE VERY THRESHOLD OF THE PROCEEDINGS, UNLESS THERE WAS VIOLATION OF THE SUBSTANTIVE PROVISION WHICH RESULTED IN SETTLEMENT OF RIGHT OF PARTIES. PROCEDURAL LAW IS PANACEA FOR ACHIEVING THE GOAL OR OBJECT OF FAIR I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 23 ADJUDICATION. APPLYING THIS PRINCIPLE, THE SUPREME COURT IN THE CASE OF RAGU THILAK D JOHN VS S RAYAPPAN & OTHERS AIR 2001 SC W 342 WHILE RELYING UPON THE JUDGEMENTS OF THE SUPREME COURT IN L. J. LEACH & CO.LTD. VS JARDINE SKINNER & CO. AIR 1957 SC 357, SMT.GANG A BAI VS VIJAY KUMAR AIR 1974 SC 1126, BKN PILLAI VS P PILLAI AIR 20 00 SC 614, HELD AS UNDER: BUT IT IS EQUALLY TRUE THAT THE COURTS WHILE DECIDI NG SUCH PRAYERS SHOULD NOT ADOPT HYPERTECHNICAL APPROAC H. LIBERAL APPROACH SHOULD BE THE GENERAL RULE PARTICULAR LY IN CASES WHERE THE OTHER SIDE CAN BE COMPENSATED WITH T HE COSTS. TECHNICALITIES OF LAW SHOULD NOT BE PERMITTED TO THE PLEADINGS TO AVOID UNCALLED FOR MULTIPLICITY OF LITIGATION. 12.6. IT IS NECESSARY TO REFER TO THE JUDGEMENT OF THE JURISDICTIONAL HIGH COURT ON THE ISSUE UNDER CONSIDERATION. A PERUSAL OF CI T VS. BHIWANI SYNTHETICS LTD. 318 ITR 177 (DELHI) SHOWS THAT THEIR LORD SHIPS WHILE CONSIDERING THE PROVISIONS OF S.140(C ) IN REGARD TO FILING OF R ETURN IN THE CONTEXT OF SIGNATURES ON RETURN WERE SEIZED OF THE ISSU E WHEREIN THE AO TREATED THE RETURN AS NON EST ON ACCOUNT OF FACT THAT IT WAS NOT SIGNED BY THE MANAGING DIRECTOR OR DIRECTOR OF ASSESSEE AND HAD B EEN SIGNED BY THE GENERAL MANAGER. IN THE FACTS OF THE SAID CASE THE ASSESSEE NEITHER DISOWNED THE RETURN NOR OBJECTED TO ITS FILING BY G.M. AS IN THE FACTS OF THAT CASE A POWER OF ATTORNEY WAS GIVEN TO THE G.M. TO SIGN THE RETURN. THE TRIBUNAL THEREIN SET ASIDE THE ORDER OF THE A.O. THE HONBLE HIGH COURT WAS OF THE VIEW THAT IT WOULD HAVE BEEN APPROPRIAT E IF AN OPPORTUNITY HAD BEEN GRANTED TO THE ASSESSEE TO HAVE THE RETURN SIGNED BY THE M.D. OR ITS DIRECTOR IN ACCORDANCE WITH THE DIRECT IONS GIVEN BY THE CIT(A) AND THERE WAS NOTHING TO SUGGEST THAT ANY PREJU DICE WOULD BE CAUSED TO THE REVENUE IF THE DIRECTION IS COMPLIED WITH. I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 24 12.7. SIMILARLY THEIR LORDSHIPS IN HARYANA STEELS 318 ITR 173 (DELHI) OF DELHI HIGH COURT AGAIN CONSIDERING THE PROVISIONS OF SEC.140 HELD THAT THE SAID SECTION MANDATES THAT THE M.D. OR SOME OTHER R ESPONSIBLE OFFICER CAN SIGN AND CURE THE IRREGULARITY. THEIR LORDSHIPS HAD OBSERVED THAT THOUGH THE SECRETARY AS PER THE PROVISIONS OF TH E COMPANIES ACT IS COMPETENT TO SIGN UNDER THAT ACT HOWEVER AS FAR AS TH E INCOME TAX ACT IS CONSIDERED NOT HAVING THE SIGNATURE OF THE AUTHORIZED PE RSON WAS CONSIDERED TO BE AN IRREGULARITY CURABLE AND THE DOCTRINE OF RELATION BACK WAS HELD TO HAVE BEEN RIGHTLY APPLIED. 12.8. REFERENCE MAY ALSO BE MADE TO YET ANOTHER JUDG EMENT OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF REMFRY & SONS VS C IT 276 ITR 1 (DELHI) WHICH FULLY SUPPORTS THE VIEW TAKEN. A PERUSAL OF TH E SAID JUDGEMENT WOULD SHOW THAT THE APPEAL FILED BEFORE THE CI T(A) WAS SIGNED AND VERIFIED BY THE AUTHORISED REPRESENTATIVE OF THE ASSE SSEE AND NOT BY THE COMPETENT PERSON. THE CIT(A) DISMISSED THE APPEAL O F THE ASSESSEE HOLDING THAT THE APPEAL WAS A RIGHT GIVEN BY THE STATUT E AND CAN BE AVAILED ONLY BY SCRUPULOUSLY FULFILLING THE CONDITION REQUIRED FOR FILING OF SUCH AN APPEAL. THE SAID ACTION OF THE CIT(A) WAS UPHELD BY THE TRIBUNAL. IN A REFERENCE FILED BEFORE THE DELHI COURT THE A SSESSEE CANVASSED THAT RULE 45(2) BE GIVEN A LIBERAL CONSTRUCTION AND STATED THAT ONCE THE MEMORANDUM WAS SIGNED BY THE AUTHORISED REPR ESENTATIVE IT WOULD BE A VALID PRESENTATION OF THE APPEAL AND IF IN ANY CA SE IT WAS TO BE HELD AS A DEFECT OPPORTUNITY SHOULD HAVE BEEN GRANTED T O RECTIFY THE DEFECT. THEIR LORDSHIPS HELD THAT THE IRREGULARITY COMMITT ED BY THE I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 25 ASSESSEE WAS CURABLE AND COULD BE RECTIFIED ON THE DAT E OF ITS FILING AND EVEN SUBSEQUENT THERETO, AS APPEAL ADMITTEDLY WAS FILED W ITHIN THE PERIOD OF LIMITATION. 12.9. IT MAY NOT BE OUT OF PLACE TO MAKE A REFERENCE TO THE OBSERVATIONS OF BOWEN L.J. IN THE CASE OF CROPPER VS. SMITH (1884) 26 CH ANCELLARY DIVISION 700 (CA) WHEREIN HIS LORDSHIP HELD THAT THE OBJECT OF COURTS IS TO DECIDE THE RIGHTS OF PARTIES AND NOT TO PUNISH THEM FO R THEIR MISTAKES IN THE CONDUCT OF THEIR CASES AND THAT THE PROPER FUNCT ION OF THE COURT WAS NOT IN SUCH CASES TO IMPOSE DISCIPLINE BUT TO DECIDE THE POINTS OF CONTROVERSY. 12.10. SIMILARLY LORD PENZANCE IN KENDALL VS. HAMILTON (1879 ) 14 APP CAS 504 AT 525 HAS SAID EVEN MORE ELOQUENTLY THAT PROCEDURE WAS AFTER ALL THE MACHINERY OF LAW, THE CHANNEL AND MEANS WHEREBY LA W WAS ADMINISTERED AND JUSTICE REACHED AND THAT PROCEDURE WO ULD BE STRANGELY DEPARTING FROM ITS PROPER OFFICE, WHEN IN PLACE OF FACILITATING IT WAS PERMITTED TO OBSTRUCT AND EVEN EXTINGUISH LEGAL RIGHTS A ND WAS THUS MADE TO GOVERN WHERE IT OUGHT TO SUBSERVE. 12.11. THE IMPORTANCE OF THE SAID LEGAL POSITION CANNOT BE OVER- EMPHASISED. THE RULES OR PROCEDURE ARE TO FURTHER THE C AUSE OF JUSTICE AND ANY APPROACH WHICH WOULD RENDER THE REMEDY INEFFECTIV E IS TO BE AVOIDED UNLESS IT WAS SAID SO SPECIFICALLY OR BY NECESSARY IMPLICATION I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 26 STATED IN THE RELEVANT PROVISIONS. THE BASIC OBJECT OF EVE RY PROCEDURAL LAW, IS THE ATTAINMENT OF EFFECTIVE AND EFFICACIOUS DISPOSAL OF THE CASES IN CONFORMITY WITH THE PROVISIONS OF THE STATUTE. A HYPER TECHNICAL INTERPRETATION OR ENFORCEMENT OF THE PROVISIONS MAY NOT B E QUITE IN ADHERENCE TO THE BASIC RULE OF LAW AND INTERPRETATION AND OPPORTUNITY TO THE AFFECTED PARTY IS TO BE GIVEN. A PROCEDURAL DEFECT SHO ULD NOT BE ALLOWED TO STAND IN THE WAY OF AN EFFECTIVE REMEDY TO WHICH THE ASSESSEE IS ENTITLED. 12.12. THE COMMON LAW RULE QUI FACIT PER OLIUM FACIT PER SE COVERS THE MATTER OF SIGNATURE BY PERSONS, BUT IT IS EQUALLY EST ABLISHED THAT WHEN A STATUTE MAKES A SPECIFIC PROVISION REQUIRING THE S IGNATURES AND VERIFICATION OF A SPECIFIC PERSON THE REQUIREMENT CANNOT BE OBVIATED BY THE SIGNATURE OF ANY OTHER PERSON THAN THE AUTHORIZED PERSON. 12.13 WE ARE ALSO FORTIFIED IN OUR VIEW BY THE PRINCIPLES LAID DOWN BY THEIR LORDSHIPS OF THE M.P. HIGH COURT IN THE CASE OF CI T VS. HOPE TEXTILES LIMITED, 287 ITR 321 (M.P.) WHO HAVE RELIED UPON THE JUDGEMENTS IN THE CASE OF DAHYABHAI GIRDHARDAS VS. BOBAJ I DAHYAJI KOTWAL, AIR 1953 BOM 28; KALU RAM PANNALAL V. JAGANNATH KA LUA, AIR 1963 MP 151; UDHAY SHANKAR TRIYAR V. RAM KALEWAR PRASA D SINGH (2006) 1 SCC 75; AND SANGRAM SINGH V. ELECTION TRIBUNAL, AIR 1955 SC 425. IN THE FACTS OF THE SAID CASE, THE MEMO OF APPEAL HAD BEEN SIGNED BY THE ADVOCATE WHO WAS APPEARING FOR THE ASSESSEE. THE TRIBUNAL I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 27 REMANDED THE MATTER BACK TO THE FILE OF THE CIT(A) WITH T HE DIRECTION TO ALLOW THE ASSESSEE TO SIGN THE MEMO OF APPEAL SO AS TO M AKE THE APPEAL IN CONFORMITY WITH THE REQUIREMENTS OF RULE 45 READ WITH SE CTION 140 OF THE INCOME TAX ACT, 1961. THE SAID ACTION OF THE TRIBUNAL WAS UPHELD BY THE M.P. HIGH COURT. 12.14. IN THE LIGHT OF THE ABOVE POSITION OF LAW, CONSIDERING THE FACT THAT THE DEPARTMENT HAS PLACED HEAVY RELIANCE ON GOLDSTONE E XPORTS LTD. (SUPRA), IT IS SEEN THAT IT ALSO DOES NOT LAY DOWN THE PRINC IPLE THAT OPPORTUNITY CANNOT BE GRANTED TO THE ASSESSEE TO REC TIFY THE DEFECT. A CAREFUL PERUSAL OF THE SAID ORDER OF THE COORDINATE BENCH WOULD SHOW THAT THAT THEREIN THE ASSESSEE WAS GIVEN REPEATED OP PORTUNITIES TO RECTIFY THE DEFECT BY THE CIT(A) OF HAVING SIGNED THE MEMO OF APPE AL AND VERIFIED BY SR.V.P.(F) INSTEAD OF BY M.D. OR DIRECTOR. ACCORDINGLY IN TH E CIRCUMSTANCES THE CIT(A) WAS HELD TO BE JUSTIFIED IN REJEC TING THE APPEAL OF THE ASSESSEE IN LIMINI. THE ASSESSEE THEREIN BEFORE T HE TRIBUNAL HAD ALSO RELIED UPON THE RESOLUTION OF THE BOARD OF DIRECTORS OF THE COMPANY AUTHORIZING SR.V.P.(F) TO DO CERTAIN ACTS ON BEHALF OF THE AS SESSEE. THE COORDINATE BENCH DID NOT ACCEPT THE CONTENTION OF THE A SSESSEE HOLDING THAT THE RESOLUTION OF THE BOARD OF DIRECTORS OF THE COM PANY CANNOT PREVAIL OVER THE STATUTORY PROVISIONS MANDATING COMPLIANCE BY SPECIFIED PERSONS TO INITIATE VALID PROCEEDINGS. HOWEVER SINCE THE A SSESSEE BEFORE THE COORDINATE BENCH REALIZES ITS FOLLY, THE COORDINATE BE NCH ACCEPTED THE PRAYER OF THE ASSESSEE FOR WANT OF MORE OPPORTUNITI ES AND THE I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 28 ASSESSEE WAS ALLOWED TO RECTIFY THE DEFECT BEFORE THE C IT(A) BY WAY OF FILING A FRESH MEMO OF APPEAL UNDER SIGNATURE AND VERIFICATION BY THE M.D. OR DIRECTOR OF THE ASSESSEE COMPANY AS THE CASE MAY BE. 12.15. IN THE FACTS OF THE PRESENT CASE ADMITTEDLY EVE N GOING BY LD.CIT, D.R.S ARGUMENTS ONLY ONE OPPORTUNITY IS GIVEN TO T HE ASSESSEE BY THE CIT(A) AND THE ASSESSEE IN ITS WISDOM CHOSE NOT TO A VAIL OF THE SAME AND CARRY OUT NECESSARY CORRECTIONS. AS PER THE GROUN D NO.3 WHICH IS BEFORE US THE ASSESEES STAND IS THAT OPPORTUNITY IS NO T GRANTED. THE PERCEPTION MAY HAVE BEEN THAT AFTER POINTING OUT THE DEFECT AND SEEKING CLARIFICATION THE SAID ACTION SHOULD HAVE BEEN FOLLOWED UP W ITH A SPECIFIC OPPORTUNITY TO CURE THE DEFECT. ON CONSIDERING WE FIND THAT HOWEVER ILL ADVISED, MISCONCEIVED AND OBDURATE STAND THE ASSESSEE M AY HAVE TAKEN, WHICH IS UNFORTUNATE, STILL SPECIFIC OPPORTUNITY TO CURE THE DEFECT CANNOT BE DENIED. IT IS ALSO SEEN THAT THE ASSESSEES CASE IS ON A BETTER FOOTING THAN AS WAS CONSIDERED BY THE CO-ORDINATE BENCH SITTING AT HYDERABAD. THE PURPOSE OF THE REMEDY PROVIDED IN THE ACT BY WAY O F FILING AN APPEAL OUGHT NOT TO BE ALLOWED TO BE DEFEATED ON TECHNICALITIES. THE DEFECT BEING AN IRREGULARITY OUGHT TO BE ALLOWED TO BE RECTIFIED BY WAY OF AN OPPORTUNITY TO CURE THE SAME. ACCORDINGLY IN THE INTERE ST OF SUBSTANTIAL JUSTICE WE SEE NO GOOD REASON AS TO WHY THE ASSESSEE SHOULD BE DEPRIVED OF SEEKING ADJUDICATION ON MERITS AFTER HAVING CURED THE DEFECT. I T A - 72/DEL/2011 M/S INDIAN AIR LINES LIMITED (NOW AIR INDIA LTD) 29 13. ACCORDINGLY FOR THE REASONS GIVEN HEREINABOVE, WE ARE OF THE VIEW THAT THE PRESENT CASE IS A FIT CASE FOR RESTORING THE ISSUE BACK TO TH E FILE OF THE CIT(A) WITH THE DIRECTIONS TO GIVE THE ASSESSEE A SPE CIFIC OPPORTUNITY TO RECTIFY THE DEFECT AND FILE A PROPER MEMO OF APPEAL CO MPLYING WITH THE RULES OF THE STATUTE. AS SUCH GROUND NO.3 OF THE ASSESSEE IS ALLOWED. 14. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. DECISION PRONOUNCED IN THE OPEN COURT ON 30 TH SEPTEMBER,2011. SD/- SD/- (G.E.VEERABHADRAPPA) (DIVA SINGH) VICE PRESIDENT JUDICIAL MEMBER DATED : 30 TH SEPTEMBER, 2011. * MANGA COPY FORWARDED TO: - 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT(A); 5.DR, ITAT ASSISTANT REGISTRAR