Appeal details
Counselvise Citation
[2022] 104 COUNSELVISE.COM (IT) 3670 (ITAT-LUCKNOW)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
5 month(s) 20 day(s)
Appellant
Respondent
Appeal Type
Miscellaneous Application
Pronouncement Date
03-07-2022
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
A
Assessment Year
2012-2013
Appeal Filed On
13-01-2022
Judgement Text
M.A. No.01 to 03/Lkw/2022 1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH ‘A’, LUCKNOW BEFORE SHRI A. D. JAIN, VICE PRESIDENT AND SHRI T. S. KAPOOR, ACCOUNTANT MEMBER M.A. No.01 to 03/Lkw/2022 (Arising out of I.T.(SS)A. No.106 to 108/Lkw/2020) Assessment Years:2012-13 to 2014-15 Dy. C.I.T., Central Circle-I, Kanpur. Vs. Ms. Stuti Dalmia, 16/79-C, Kanpur. PAN:AOTPD 7980H (Appellant) (Respondent) O R D E R PER T. S. KAPOOR, A.M. These Misc. Applications have been filed by the Revenue against the orders of the Tribunal dated 12/07/2021 in respect of assessee, namely, M/s Stuti Dalmia. 2. Learned CIT, (D.R.), at the outset, submitted that Tribunal in the order dated 12.07.2021 had allowed appeals of the assessee on a technical issue by relying on the orders of Meeta Gutgutia and Kabul Chawla. It was submitted that in the case of Kabul Chawla, Hon'ble Supreme Court had dismissed the appeal of the Revenue due to low tax effect, therefore, the law laid down in the case of Kabul Chawla cannot be said to be law of the land. As regards the case law of Meeta Gutgutia, learned CIT (D.R.) submitted that in this case, the SLP was dismissed at the threshold and such Revenue by Smt. Sheela Chopra, CIT, D.R. Assessee by Shri Ashish Jaiswal, Advocate Date of hearing 31/05/2022 Date of pronouncement 04/07/2022 M.A. No.01 to 03/Lkw/2022 2 dismissal of SLP neither constitutes declaration of law nor a binding precedent. It was submitted that an order refusing special leave to appeal may be a non speaking order or a speaking one and in either case it does not attract the doctrine of merger. It was submitted that an order refusing special leave to appeal does not stand substituted in place of the order under challenge and all that it means is that the Court was not inclined to exercise its discretion so as to allow the appeal being filed. Learned CIT, (D.R.) in this respect relied on the case of Khoday Distilleries Ltd. where in civil appeal no. 2432 of 2019 vide order of three Judge bench of Hon'ble Supreme Court, the view which was earlier taken in the three Judge Bench decision in the case of Kunhayammed & Ors. vs. State of Kerala & Ors. 245 ITR 360 (SC) has again been affirmed. The learned CIT (D.R.) further submitted that Revenue’s SLP has been allowed to be proceeded with against the Delhi High Court decision by Apex Court on same issue in another case of Pr. CIT vs. Best Infrastructure (India) (P.) Ltd. 256 Taxmann 63 (SC) implying that the law on issue is yet to be declared by Supreme Court. The learned CIT(D.R.) further submitted that SLP filed by the Revenue in the case of CIT vs. Continental Warehousing Corporation has been admitted by Hon'ble Supreme Court on the same issue as to whether any addition in the absence of incriminating material can be made in a year where assessment stood completed and therefore, in view of the above facts and circumstances, it was submitted that there was no law laid down by the Supreme Court in this respect. In view of this legal proposition of Apex Court, the conclusion that the dismissal of SLP in the case of Meeta Gutgutia in limine constitutes a declaration of law by Supreme Court so as to override the order of Hon'ble Allahabad High Court in the case of Raj Kumar Arora is against the propounded law declared by Supreme Court on the effect of dismissal of SLP. Learned CIT (D.R.) submitted that in view of the fact that the order of Kabul Chawla and Meeta Gutgutia was not law of M.A. No.01 to 03/Lkw/2022 3 the land, the judgment of Hon'ble Allahabad High Court (being jurisdictional High Court) in the case of CIT vs. Raj Kumar Arora was duly applicable to the facts of the assessee and therefore, the Tribunal has wrongly allowed appeals of the assessee on this point and therefore, it constitutes a mistake apparent from the face of record which is a valid ground for rectification u/s 254(2) of the Act. and it was prayed that the orders passed by Tribunal may be recalled and be heard on merits based on the facts of the case and legal provisions of the Act. 3. Ld. AR of the assessee submitted that there is no mistake apparent on record on the order of Tribunal and the Tribunal had passed the order after considering the judgment of the Hon'ble High Court in the case of Raj Kumar Arora. It was further submitted that the besides reliance placed on the order of Meeta Gutgutia the Tribunal also relied on the judgment of Singhad Technical Education wherein Hon'ble Supreme Court held that there must be incriminating material relating to that specific year while making addition u/s 153C of the Act in that particular year. The ld. AR submitted that this judgment of Hon'ble Supreme Court has further affirmed that for making additions u/s. 153A/153C the existence of incriminating material is sine qua non. It was further submitted that in the application for rectification filed by Revenue, the Revenue has stated that the order in the case of CIT vs. Continental Warehousing Corporation 235 taxman 568 has been admitted by the Hon'ble Supreme Court whereas the fact is that before hearing of appeals which happened on 16.06.2021, the Hon'ble Supreme Court had decided the case of CIT vs. Continental Warehousing Corporation and had dismissed the civil appeal filed by the Revenue and when the civil appeal is dismissed by the Hon'ble Supreme Court even without a speaking order, the law laid down in the High court supported by dismissal of civil appeal by Hon'ble Supreme Court becomes the law of land. It was submitted that a similar MA was filed by the Revenue in MA No. 01 to M.A. No.01 to 03/Lkw/2022 4 12/Lkw/2021 and similar application for rectification of mistake was filed by the Revenue in those MAs and in this respect our attention was invited to the order of Tribunal dated 28.04.2022 passed in these MAs. It was submitted that the Tribunal after noting down the arguments of both the parties has dismissed the miscellaneous applications filed by the Revenue and therefore the same decision of the Tribunal will be applicable to the MAs filed by the Revenue against the Tribunal order dated 12.07.2021. 4. We have heard the rival parties and have gone through the material placed on record. We find that similar miscellaneous applications were filed by the Revenue in the form MA Nos. 1 to 5/Lkw/2021 and the Tribunal vide order dated 28.04.2022 has dismissed the miscellaneous applications filed by Revenue by holding as under: 7. We have heard the rival parties and have gone through the material placed on record. We find that the Tribunal vide two orders dated 16/12/2020 and 01/02/2021 has decided a legal issue as to whether the additions can be made in the absence of incriminating material where the assessments have already been concluded before the date of search. The Tribunal after relying on the judgment of Kabul Chawla and Meeta Gutgutia has decided the issue in favour of the assessee. While deciding such issue, the Tribunal has also taken into account the judgment of Hon'ble jurisdictional High Court in the case of Raj Kumar Arora which judgment is against the assessee and is in favour of the Revenue. The Tribunal, after noting down the judgment in the case of Raj Kumar Arora, followed the judgment of Meeta Gutgutia by Hon'ble Supreme Court. The Revenue by way of these Misc. Applications has argued that since the judgment in the case of Meeta Gutgutia did not amount to law laid down by Hon'ble Supreme Court therefore, the judgment of jurisdictional High Court was duly applicable to the facts of the assessees. However, we do not find any merit in the arguments of the Revenue that there has occurred a mistake in the order of the Tribunal as the judgment of Hon'ble Allahabad High Court in the case of Raj Kumar Arora has duly been taken note of in the above Tribunal order. While considering the judgment of Hon'ble Allahabad High Court, the Tribunal has taken a particular view regarding the judgment of Hon'ble Supreme Court in the case of Meeta Gutgutia by interpreting that the said decision of Meeta Gutgutia is though a short order but is law of land. The view M.A. No.01 to 03/Lkw/2022 5 taken by the Tribunal is affirmed by the decision of Hon'ble Karnataka High Court in the case of Shri H. N. Subeer and Shri H. N. Vasanth Kumar vs. H. N. Vijayamba and Other wherein the Hon'ble High Court considered a similar order passed by Hon'ble Supreme Court and the Hon'ble Court held that the order of Supreme Court dismissing the SLP may be a short order but in our view it is law of the land. The Hon'ble High Court held that when the Apex Court has not found any merit in the SLP and has accordingly dismissed it even without issuance of notice to the respondents, we think that it is affirmation of judgment of this court. The expression of the Hon'ble Supreme Court "We do not find any merit in this petition" has to be given its true meaning and understood as resulting in a finality in the litigation. The Hon'ble Karnataka High Court, after discussing the law laid down by three Judges Bench of Hon'ble Supreme Court in the case of Khoday Distilleries Ltd. has taken this view and has considered a similar order of Hon'ble Supreme Court in the case of H. N. Subeer and Shri H. N. Vasanth Kumar vs. H. N. Vijayamba and Other in SLP No. 34884 of 2014. Hon'ble Supreme Court had dismissed the SLP in this case by recording the following order: “We do not find any merit in this petition. The SLP is accordingly dismissed.” 7.1 Hon'ble Karnataka High Court, in the case of H. N. Subeer and Shri H. N. Vasanth Kumar vs. H. N. Vijayamba and Others, after discussing the case law of Khoday Distilleries Ltd. has held such order to be a speaking order. The findings of Hon'ble Karnataka High Court, as contained from para 4 to para 22 are reproduced below: “4. ......................................................................................................... 21........ 22. However, learned senior counsel for the petitioners has drawn our attention to Khoday Distilleries Limited, which is a recent judgment of a three Judge Bench of the Hon'ble Supreme Court passed on an order of reference by a two Judge Bench (which has also referred to Abbai Maligai Partnership Firm), to contend that under similar circumstances, the Hon'ble Supreme Court had set aside an order passed by this Court in a review petition, which was M.A. No.01 to 03/Lkw/2022 6 filed after the dismissal of the special leave petition by the Hon'ble Supreme Court. It was observed that despite the dismissal of the special leave petition by the Supreme Court, a review petition could be maintained before the High Court. While holding so, the Hon'ble Supreme Court has referred to paragraph No.26 of Kunhayammed, which is extracted by us above, wherein reference has been made to the judgment in Abbai Maligai Partnership Firm. But, it has also been stated in paragraph No.24 of Khoday Distilleries Limited that Abbai Maligai Partnership Firm was decided on its peculiar facts. 23. Before proceeding further, it would be necessary to summarise the background leading to the reference to a larger Bench in Khoday Distilleries Limited. (a) By an order dated 19.10.2012 made in Khoday Distilleries Limited, reference was made by a two Judge Bench of the Hon'ble Supreme Court to a larger Bench to consider the issue of principle of res judicata and doctrine of merger in relation to statutory appeal and the appeal invoking Article 136 of the Constitution. In the said reference order inter alia, the earlier decisions of the Hon'ble Supreme Court in the case of Palan Roman Catholic Mission Vs. S. Bagirathi Ammal, (2009) 16 SCC 657, K.Rajamouli Vs. A.V.K.N. Swamy (2001) 5 SCC 37, (K.Rajamouli) and Gangadhara Palo Vs. Revenue Division Officer, (2011) 4 SCC 602, (Gangadhara Palo) were referred to by observing that there was some conflict between the judgments in K.Rajamouli and Gangadhara Palo vis-a-vis the observations made in Abbai Maligai Partnership Firm. (b) In K.Rajamouli, after referring to the judgment in Abbai Maligai Partnership Firm, Sree Narayana Dharmasanghom Trust and Prabhakar Bhikaji Ingle, at paragraph 4 it has been held as under: "4. Following the decision in the case of Kunhayammed we are of the view that the dismissal of the special leave petition against the main judgment of the high Court would not constitute res juuicata when a special leave petition is filed against the order passed in the review petition provided the review petition was filed M.A. No.01 to 03/Lkw/2022 7 prior to filing of special leave petition against the main -judgment of the High Court. The position would be different where the dismissal of the special leave petition against the main judgment a party files a review petition after a long delay on the ground that the party was prosecuting remedy bv way of special leave petition. In such a situation the filing of review would be an abuse of the process of the law. We are in agreement with the view taken in Abbai Maligai Partnership Firm that if High Court allows the review petition filed after the special leave petition was dismissed after condoning the delay, it would be treated as an affront to the order of the Supreme Court." (c) In Gangadhara Pale, a two Judge Bench of the Hon'ble Supreme Court held that the observations made in K.Rajamouli was a stray observation and did not amount to a precedent. (d) Subsequently, in Khoday Distilleries Limited, a three Judge Bench dealt on the question of extinguishment of the power to review a judgment once leave was granted in a special leave petition and the appeal is decided and whether the doctrine of merger applies. (e) In the said case, it was observed that the High Court before exercising its review jurisdiction has to examine whether the same would amount to breach of judicial discipline after considering the scope and power exercised under Article 136 of the Constitution. It was further observed that if the petition seeking grant of leave to appeal is dismissed, it is an expression of opinion by the Supreme Court that a case for invoking the appellate jurisdiction of the Court was not made out. But, significantly, it has also been observed that in spite of a petition for special leave to appeal having been filed, the judgment, decree or order against which leave to appeal has been sought for, continues to be final, effective and binding as between the parties. The Court thereafter analysed a number of cases where orders of different nature were passed and dealt with the judgments by classifying them in the following categories: M.A. No.01 to 03/Lkw/2022 8 (i) Dismissal at the stage of special leave petition - without reasons - no resjudicatd, no merger, (ii) Dismissal of the special leave petition by speaking or reasoned order - no merger, but rule of discipline and Article 141 attracted, (iii) Leave granted -dismissal without reasons - merger results. Subsequently, in paragraph 24, it was observed as under: "24. Having noted the aforesaid two judgments and particularly the fact that the earlier judgment in the case of Abbai Maligai Partnership Firm is duly taken cognisance of and explained in the latter judgment, we are of the view that there is no conflict insofar as ratio of the two cases is concerned. Moreover, Abbai Maligai Partnership Firm was decided on its peculiar facts, with no discussion on any principle of law, whereas Kunhayammed is on elaborate discourse based on well accepted propositions of law which are applicable for such an issue. We are, therefore, of the view that detailed judgment in Kunhayammed lays down the correct law and there is no need to refer the cases to larger Bench, as was contended by the counsel for the appellant." (f) On a reading of the above, it becomes clear that in Khoday Distilleries Limited, there has been no over- ruling of the judgment passed in Abbai Maligai Partnership Firm. In fact, it has been held that there is no conflict between Abbai Maligai Partnership Firm anc! Kunhayammed- Thereafter, reference has been made to K. Rajamouli to observe that while the dismissal of the special leave petition against the impugned judgment of the High Court would not constitute res judicata, when special leave petition is filed against the order passed in the review petition provided the review petition was filed prior to filing of special leave petition against the main judgment of the High Court, the position would be different after the dismissal of the special leave petition against the judgment a review petition is filed after a long delay. In the said case, the party filed a review petition before the High Court after M.A. No.01 to 03/Lkw/2022 9 a long delay on the ground that the party was prosecuting the remedy by way of special leave petition. In such a situation, the filing of the review was held to be an abuse of process of the law. It is further noted that in R. Rajamouli, the Hon'ble Supreme Court was in agreement with the view taken in Abbai Maligai Partnership Firm that if the High Court allows the review petition filed after the special leave petition was dismissed after condoning the delay, it would be treated as an affront to the order of the Supreme Court although in Gangadhar Palo, the same was held to be a stray observation. (g) Thus, on a reading of the judgment in Knoday Distilleries Limited, it is clear that the judgment in Abbai Maligai Partnership Firm has neither been over- ruled nor held to be bad in law. Further, even in Kunhayammed, there is no such observation that Abbai Maligai Partnership Firm was not in accordance with law. In Khoday Distilleries Limited, however, it has been stated that Abbai Maligai Partnership Firm was decided on its peculiar facts. 24. Hence, we refer; to the facts of the case in Khoday Distilleries Limited and the facts of the present case. (a) In Khoday Distilleries Limited, respondent No.1 therein had filed original suit against the appellant therein before the City Civil Court at Bengaluru for recovery of a sum of Rs.1,00,76,630/- along, with interest. The City Civil Court after trial had dismissed the suit as barred by limitation by its judgment and decree dated 11/11/2005 after giving a finding on merits that the ''money was payable by the appellant to respondent No.1 therein. (b) Being aggrieved, respondent No.1 had preferred regular first appeal before this Court. By judgment dated 12/11/2008, the same was allowed by holding that the suit filed was within the period of limitation. Accordingly, this Court passed a decree for the amount claimed with interest at the rate of 12% per annum from the date of demand i.e., 19/07/1994 up to M.A. No.01 to 03/Lkw/2022 10 03/08/1994 and interest was granted at the rate of 10% per annum from 04/08/1994 till the date of payment. (c) Being aggrieved, the appellant preferred special leave petition before the Hon'ble Supreme Court which was dismissed on 04/12/2009 after condoning the delay. After dismissal of the special leave petition, respondent No.1 therein filed execution petition before the trial court. After the dismissal of the special leave petition, respondent No.1 had filed an application for rectification cf the judgment which was allowed on 20/10/2010 directing the appellant to pay the decretal amount with interest and costs. (d) The appellant therein after dismissal of the special leave petition filed a review petition seeking the review of the judgment dated 12/11/2008 passed by this Court contending that this Court had granted relief which was not even sought for by respondent No.1 therein in the suit. It was found that the plaintiff therein had not claimed any interest at any particular rate and he had not prayed for interest from a particular date and he had also not prayed for interest on different rates also. Thus, the decree passed by this Court was not based on the prayer sought for by the plaintiff in the suit. This mistake appeared on the face of the record. Hence, the judgment dated 12/11/2008 as corrected on 20/10/2010 was sought to be reviewed. It was also pleaded that the award of interest from 04/08/1994 was also without jurisdiction, since it was not claimed by respondent No.1 therein in the that court. The review petition was dismissed by order dated 09/09/2011 by holding that the Hon'ble Supreme Court has dismissed the special leave petition on 04/12/2009 that the judgment and decree passed by this Court had been confirmed by the Hon'ble Supreme Court and therefore, question of entertaining any review did not arise. (e) Against the order passed in the review petition, the matter was taken up in special leave petition, which was referred to larger Bench to consider the M.A. No.01 to 03/Lkw/2022 11 question as to whether the review petition was maintainable before this Court after the special leave petition was dismissed by the Hon'ble Supreme Court. It has to be noted that the precise question arose in the background of the aforesaid facts. (f) In the instant case, the petitioners herein as defendant Nos.l and 2 in O.5. No.31 of 1992 had filed Regular First Appeal No.1021 of 2004 against the judgment and decree passed in the said suit by the Court of Civil Judge (Sr.Dn.) and JMFC, Bhadravathi decreeing the suit of the respondents-plaintiffs by granting the relief of declaration of title in respect of the suit schedule property and holding that the two registered sale deeds i.e., sale deed dated 30/04/1987 executed by defendant No.1 in favour of defendant Nos.2 and 3 and said deed dated 20/11/1987 by defendant No.3 in favour of defendant No.2 were not binding on the plaintiff and were of no consequence to her title. Consequently, an order of perpetual injunction to prevent the defendants and their agents or servants from interfering in any manner with the plaintiff's peaceful possession and enjoyment of the suit schedule property was also granted. In the regular first appeal filed by the petitioners herein, this Court after referring to the facts and contentions of respective parties, raised as many as six points for consideration and by a detailed judgment dismissed the appeal on appreciation of the entire oral and documentary evidence on record by holding that the judgment of the trial court did not warrant any interference. (g) It is noted that this review petition is filed under Order XLVII Rule- 1 read with Section 114 of CPC assailing the judgment passed by a co-ordinate Bench of this Court on 03/09/2013. This review petition has been filed on 14/11/7,017 almost four years after the judgment was passed by this Court. In the interregnum, the petitioners herein had filed Special Leave Petition No.33605/2013, which was dismissed on 24/04/2017 after hearing both sides. Thus, the petitioners herein, being aggrieved by the judgment of M.A. No.01 to 03/Lkw/2022 12 this Court dated 03/09/2013, were prosecuting the special leave petition for almost four years before the Hon'ble Supreme Court and after hearing both sides, the special leave petition was dismissed by order dated 24/04/2017. Subsequently, on 14/11/2017 after a period of nearly seven months, this review petition has been filed. This is not a case where the special leave petition has been dismissed ex parte, or without issuance of notice to the respondent. In this case, the special leave petition has been dismissed after hearing the learned counsel for the petitioners as well as the respondents' counsel. Therefore, it must be construed that the special leave petition has been dismissed on merits and net by exercising discretionary power refusing to entertain the same and without issuing notice to the respondents. In such a case, can it be construed that after the dismissal of the special leave petition, on hearing both sides, a party could maintain a review petition before this Court for seeking review of the judgment or order passed by this Court? What is significant to note is not whether the doctrine of merger applies or the principle of res judicata applies. In our view, in such a case where a special leave petition is dismissed after hearing both sides, the judgment in Abbai Maligai Partnership Firm applies. The reason being once a special leave petition is dismissed after hearing both sides, it would no longer be a case of pure exercise of discretionary power, but on merits. This is because the Hon'ble Supreme Court did not use its discretionary power to dismiss the special leave petition filed by the petitioners herein ex parte but notice was ordered to the respondents herein. After hearing both sides, the special leave petition has been dismissed. It is not a case of dismissal simpliciter but a dismissal after hearing both sides. Therefore, in our view, the doctrine of merger applies. In fact, the Hon'ble Supreme Court has also opined that even if a special leave petition is dismissed by a detailed order, the doctrine of merger would apply even if leave would not have been granted. This is clear on a reading of the judgment in Kunhayammed. The Hon'ble Supreme Court has also opined that the doctrine of merger is not of universal application and M.A. No.01 to 03/Lkw/2022 13 each case would have to be considered in light of its facts in order to ascertain as to whether the review petition could be entertained by the High Court after the dismissal of a special leave petition arising from the order / judgment of the High Court although the doctrine of merger would not apply as even according to the Hon'ble Supreme Court, it is not a doctrine of universal application. 25. But, what is more important to note in the instant case is whether there is an abuse of process of this Court and consequently, whether the petitioners are empowered to invoke the review jurisdiction after the Hon'ble Supreme Court has dismissed the special leave petition after hearing the counsel on both sides and therefore, emphasis on judicial propriety and discipline would assume significance. Further, this is also not a case where before the Hon'ble Supreme Court permission was sought for withdrawal of the special leave petition with liberty to file a review petition which we have come across in many cases and on the strength of the liberty granted by the Hon'ble Supreme Court, delay in filing the review petition is condoned by the High Court and the review petitions are entertained and disposed of. But, in the instant case, there is no withdrawal of the special leave petition, on the other hand, the special leave petition is dismissed after hearing the learned counsel on both sides. In fact, in such a circumstance, liberty was not sought to file a review petition and it could not have been sought by the petitioners as they were unsuccessful before the Hon'ble Supreme Court. 26. Further, what is of significance is that the review petition has been filed four years after the dismissal of the regular first appeal by a co-ordinate bench of this Court. It may be that the petitioners herein were prosecuting this special leave petition before the Hon'ble Supreme Court. The Judges who passed the judgment in the regular first appeal have since retired on attaining the age of superannuation and after the dismissal of special leave petition, a second innings, so to say, is sought by the petitioners in filing this review M.A. No.01 to 03/Lkw/2022 14 petition. In our view, this is a clear case of abuse of the process of law and of this Court and a clear case of ignoring the Supreme Court order dismissing the special leave petition and venturing to file this review petition, which is wholly speculative in nature. We are afraid that in the instant case, we cannot entertain the review petition owing to judicial discipline and propriety and the glaring facts in the instant case. If our non- entertaining of the review petition is to be construed as an error, then we would say that we may have erred on the side of caution and on being mindful of the judicial discipline and propriety, as submitted by the learned counsel for the respondents and also the judgment of the Hon'ble Supreme Court on the issue Linder consideration, particularly the observations in Abbai Maligai Partnership Firm which have not been held to be contrary to law in any subsequent judgments of the Hon'ble Supreme Court. 27. Even though the Hon'ble Supreme Court has in Khoday Distilleries Limited permitted the review petition to be heard by this Court, the same are based on the peculiar facts that obtained in the said case which we have referred to. This is not to say that the judgment of the Hon'ble Supreme Court in Khoday Distilleries Limited is based purely on the facts of the said case. In fact, it is an order passed on a reference to consider as to whether there were conflicting opinions expressed in judgments of the Hon'ble Supreme Court subsequent to Abbai Maligai Partnership Firm or Kunhayammed. While, considering the said issue, the three Judge Bench in Khoday Distilleries Limited has not over-ruled the judgment in Abbai Maligai Partnership Firm but has observed that it was decided on its own peculiar facts. But, we find that the facts which obtained in Abbai Maligai Partnership Firm are replicated in the instant case, inasmuch as in the said case also after the dismissal cf the special leave petition after hearing both sides, the review petitions were filed challenging the judgment passed by the High Court after four years and thus, there is a delay of 1051 days in filing the review petitions after the dismissal of the regular first appeal. In Abbai M.A. No.01 to 03/Lkw/2022 15 Maligai Partnership Firm, the delay was condoned and the order passed by the High Court was reviewed and reversed and thereafter, the appellants therein filed special leave petition challenging the order passed in the review petition. While allowing the said special leave petition, the Hon'ble Supreme Court made the observations deprecating the manner in which the review petitions were filed and heard by the High Court after the dismissal of the special leave petitions, and the respondents therein were directed to pay costs to the appellants therein. 28. We find that the peculiar facts which arise in Abbai Maligai Partnership Firm exactly arise in the instant case also inasmuch as the review petition filed herein is after the dismissal of the special leave petition by the Hon'ble Supreme Court on 24/04/2017. It may be that, in Khoday Distilleries Limited the Hon'ble Supreme Court permitted the review petition to be entertained by this Court by setting aside the order passed by this Court dismissing the review petition as not maintainable, but we are more mindful and conscious of the observations in the nature of strictures passed by the Hon'ble Supreme Court in paragraph No.4 of Abbai Maligai Partnership Firm. The said strictures are serious and it implies that once the Supreme Court dismisses a special leave petition, no review petition could be entertained thereafter by the High Court. 29. In Union of India & Another Vs. Raghubir Singh (Dead) by LRs. etc., [(1989) 2 SCC 754], (Raghubir Singh) a Constitution Bench of the Hon'ble Supreme Court has observed that India is governed by a judicial system identified by a hierarchy of courts, where doctrine of binding precedent is a cardinal feature of its jurisprudence. Unlike in the United Kingdom, in India, we have a written Constitution which represents the supreme law of the land and the Judiciary sits in judgment not only on the implementation of the law by the Executive, but also on the validity of the .Legislation made by the Parliament or the State Legislature which is sought to be implemented. That the Supreme Court as the M.A. No.01 to 03/Lkw/2022 16 highest court in the entire judicial system, the law declared by it by Article 141 of the Constitution is binding on all courts within the territory of India. That the decisions of the Supreme Court are of significance not merely because they constitute adjudication on the rights of the parties and resolve the dispute between them, but also because in doing so, they embody a declaration of law operating as a binding principle in future cases. More significantly, an order of the Supreme Court passed after hearing the counsel for the respective parties is binding on the parties. Such an order cannot be interfered with by any inferior court, unless leave has been granted to any party to do so expressly. In our view, such a thing cannot be permitted merely because the special leave petition is dismissed. If review petitions are filed and entertained after dismissal of a special leave petition after hearing both sides, it would result in a situation of there being no finality in the matter. 30. Finality in judgments of courts is a salutary principle of law. The Hon'ble supreme Court in Union of India vs. S.P. Sharma, [(2014) 6 SCC 351, para 90], has held that an issue of law can be overruled later on, but a question of fact cannot be re- opened once it has been finally sealed in proceedings inter se between the parties. That the doctrine of finality has to be applied in a strict legal sense. Re- opening of concluded judgments of the Court would not only tantamount to merely an abuse of the process of the court but would have far-reaching adverse effect on the administration of justice. Thus, the principle of finality of litigation is based -on a sound firm principle of public policy. In the absence of such a principle great oppression might result under the colour and pretence of law inasmuch as there would be no end to litigation. Further, in Rupa Ashok Hurra vs. Ashok Hurra, [(2002) 4 SCC 388, para 40], it has been observed that the principle of finality is insisted upon not on the ground that a judgment given by the Apex Court is impeccable but on the maxim interest reipublicae ut sit finis litium. M.A. No.01 to 03/Lkw/2022 17 31. Further, the judgment in K.RajamouH is by a two judge Bench which has followed the observations in Abbai Maligai Partnership Firm, but in Gangadhar Palo, which is also a decision by a two Judge Bench strength, has not appreciated the observations made in Abbai Maligai Partnership Firm. Similarly, in Kunhayammed, which is also a decision of three Hon'ble Judges, has also not over-ruled the judgment in Abbai Maligai Partnership Firm. 32. In fact, in paragraph No.26.3 of Khoday Distilleries Limited a reference has been made to paragraph No.37 of Kunhayammed's case which we have extracted above but we are more conscious and are bound by what is stated in paragraph No.26 in Kunhayammed's case which is an extract of paragraph No.4 of Abbsi Maligai Partnership Firm. When the said position of law has been affirmed by a three Judge Bench in Kunnayammed and when Kunhayammed has been af f irmed in Khoday Distilleries Limited, in our view, this review petition, which is filed after the dismissal of special leave petition, after hearing the counsel on both sides, by the Hon'ble Supreme Court affirming the judgment of this Court in the regular first appeal, is not maintainable. In the circumstances, we dismiss the review petition as not maintainable." 5. In the instant case, a Co-ordinate Bench of this Court dismissed the appeal on 22/07/2015. Subsequently, the appellants herein preferred special leave petition before the Hon'ble Supreme Court. The special leave petition was dismissed as the Hon'ble Supreme Court did not find any merit in the petition. Even though the special leave petition was dismissed without issuance of notice to the respondents and upon hearing the learned counsel for the petitioners herein, the same was dismissed as the Hon'ble Supreme Court did not find any merit. Once, such an order is passed by the apex court, we again raise a question to ourselves as to whether this Court can entertain the review petition and proceed to review the judgment of the co-ordinate Bench of this Court after the dismissal of the special leave petition by the Hon'ble Supreme Court on not finding any merit in the same. The order of the Hon'ble Supreme Court dismissing the M.A. No.01 to 03/Lkw/2022 18 special leave petition may be a short order but in our view it is pregnant with meaning. According to us, when the apex court has not found any merit in the special leave petition and has accordingly dismissed it, even without issuance of notice to the respondents, we think that is a confirmation of the judgment of this Court. The expression of the Hon'ble Supreme Court "We do not find any merit in this petition" has to be given its true meaning and understood as resulting in a finality in the litigation. Even though the order of the apex court is brief, yet it is not without significance as far as parties to this litigation are concerned. In the circumstances, we do not find it just and proper to entertain this review petition. Hence, the review petition is dismissed on the ground of maintainability. Consequently, all pending applications stand dismissed.” 7.2 In the present case, Hon'ble Supreme Court in the case of Meeta Gutgutia has recorded similar findings, which for the sake of completeness is reproduced below: “Delay condoned. We do not find any merit in this petition. The special leave petition is, accordingly dismissed. Pending application stands disposed of.” 7.3 Therefore, in view of the judgment of Hon'ble Karnataka High Court, we hold that such order passed by Hon'ble Supreme Court in the case of Meeta Gutgutia is a speaking order, which though not merges with the order of Hon'ble High Court but here in this case Article 141 of Constitution of India will apply. 7.4 Since we have already held the order passed by Hon'ble Supreme Court in the case of Meeta Gutgutia to be a speaking order in accordance with the judgment of Hon'ble Karnataka High Court, such order of Hon'ble Supreme Court has become law of land and will override the judgment of Hon'ble jurisdictional High Court of Allahabad. The view taken by Hon'ble Supreme Court in the case of Khoday Distilleries Ltd. Limited also supports our findings. Hon'ble Supreme Court in the case of Khoday Distilleries Ltd. has summed up its findings in para 44 which for the sake of completeness is reproduced below: M.A. No.01 to 03/Lkw/2022 19 (i) Where an appeal or revision is provided against an order passed by a court, tribunal or any other authority before superior forum and such superior forum modifies, reverses or affirms the decision put in issue before it, the decision by the subordinate, forum merges in the decision by the superior forum and it is the latter which subsists, remains operative and is capable of enforcement in the eye of law. (ii) The jurisdiction conferred by Article 136 of the Constitution is divisible into two stages. The first stage is upto the disposal of prayer for special leave to file an appeal. The second stage commences if and when the leave to appeal is granted and the special leave petition is converted into an appeal. (iii) The doctrine of merger is not a doctrine of universal or unlimited application. It will depend on the nature of jurisdiction exercised by the superior forum and the content or subject- matter of challenge laid or capable of being laid shall be determinative of the applicability of merger. The superior jurisdiction should be capable of reversing, modifying or affirming the order put in issue before it. Under Article 136 of the Constitution the Supreme Court may reverse, modify or affirm the judgment-decree or order appealed against while exercising its appellate jurisdiction and not while exercising the discretionary jurisdiction disposing of petition for special leave to appeal. The doctrine of merger can therefore be applied to the former and not to the latter. (iv) An order refusing special leave to appeal may be a non- speaking order or a speaking one. In either case it does not attract the doctrine of merger. An order refusing special leave to appeal does not stand substituted in place of the order under challenge. All that it means is that the Court was not inclined to exercise its discretion so as to allow the appeal being filed. (v) If the order refusing leave to appeal is a speaking order, i.e., gives reasons for refusing the grant of leave, then the order has two implications. Firstly, the statement of law contained in the order is a declaration of law by the Supreme Court within the meaning of Article 141 of the Constitution. Secondly, other than the declaration of law, whatever is stated in the order are the findings recorded by the Supreme Court which would bind the parties thereto and also the court, tribunal or authority in any M.A. No.01 to 03/Lkw/2022 20 proceedings subsequent thereto by way of judicial discipline, the Supreme Court being the Apex Court of the country. But, this does not amount to saying that the order of the court, tribunal or authority below has stood merged in the order of the Supreme Court rejecting the special leave petition or that the order of the Supreme Court is the only order binding as res judicata in subsequent proceedings between the parties. (vi) Once leave to appeal has been granted and appellate jurisdiction of Supreme Court has been invoked the order passed in appeal would attract the doctrine of merger; the order may be of reversal, modification or merely affirmation. (vii) On an appeal having been preferred or a petition seeking leave to appeal having been converted into an appeal before the Supreme Court the jurisdiction of High Court to entertain a review petition is lost thereafter as provided by sub-rule (1) of Rule 1 of Order 47 7.4 We further find that in the case of Continental Warehousing Corporation, the Hon'ble Bombay High Court vide order dated 21/04/2015 had decided the following two questions of law: “1. No addition can be made in respect of assessments which have become final if no incriminating material is found during search. 2. ICDs and CFSs are infrastructural facility entitled to deduction under sub-section (4) of section 80-IA. 7.5 Hon'ble Bombay High Court had answered these questions in favour of the assessee. The Revenue filed SLP in the Supreme Court and Hon'ble Supreme Court vide order dated 12 th October, 2015 admitted the SLP filed by the Revenue and after converting into Civil Appeal No.8546 of 2015 tagged it along with Civil Appeal No. 8900 of 2012. Such Civil Appeals were ultimately dismissed vide order of the Supreme Court dated 24/04/2018. The undisputed law is that if Civil Appeal is dismissed, even without a speaking order, the order of High Court merges with the order of Supreme Court and becomes the law of land. The Hon'ble Supreme Court had dismissed these Civil Appeals vide order dated 24/04/2018 which date is before the date of orders of the appeals of the Tribunal which are dated 16/12/2020 and 01/02/2021 which means that such order of Supreme Court was there at the time of passing of orders and in view of this fact also the proposition that in case of completed assessment, the addition can only be M.A. No.01 to 03/Lkw/2022 21 made on the basis of incriminating material, has attained finality and therefore, there is no mistake apparent from the face of record. 8. In the result, all the Misc. Applications of the Revenue are dismissed.” 5. Following the above and finding the facts and circumstances similar, we dismiss all the miscellaneous applications filed by the Revenue. 6. In the result, the Miscellaneous Applications filed by Revenue are dismissed. (Order pronounced in the open court on 04/07/2022) Sd/- Sd/- ( A. D. JAIN ) ( T. S. KAPOOR ) Vice President Accountant Member Dated: 04/07/2022 Aks/- Copy of the order forwarded to : 1. The Appellant 2. The Respondent. 3. Concerned CIT 4. The CIT(A) 5. D.R., I.T.A.T., Lucknow Assistant Registrar
