The ITO, Wadr-2(5), Kozhikkode, Kozhikkode V. M/s.Tharuvanna Serviced Co-op bank Ltd, Wayanad

MA 122/COCH/2020

AI Insights

The case involves multiple miscellaneous petitions filed by the Revenue against various cooperative banks, challenging the Tribunal's earlier decisions based on subsequent judicial interpretations. The core issue was the timeliness of the MPs filed under section 254(2) of the Income Tax Act, 1961, following changes in the law that reduced the time limit for filing such applications. The Tribunal examined whether the MPs were filed within the permissible time frame and considered the implications of recent judicial decisions on the earlier rulings. The Tribunal concluded that all MPs were filed beyond the statutory deadline, rendering them not maintainable.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 115508 (ITAT-COCHIN)
• Duration Of Justice: 3 year(s) 10 month(s) 2 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 01-08-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 10-12-2020
• Assessment Year: 2013-2014
• Appeal Filed On: 29-09-2019
• Other Referred Cases: Chirakkal Service Co-operative Bank Ltd. vs. CIT [2016] 384 ITR 490 (Ker), CIT vs. Poonjar Service Co-operative Bank Ltd. [2019] 414 ITR 67 (Ker)(FB), Perinthalmanna Service Co-operative Bank Ltd. [2014] 363 ITR 268 (Ker), Mavilayi Service Co-operative Bank Ltd. vs. Pr. CIT [2021] 431 ITR 1 (SC), Kil Kotagari Tea & Coffee Estates Co. Ltd. vs. ITAT [1988] 174 ITR 579 (Ker), Asst. CIT vs. Saurashtra Kutch Stock Exchange Ltd. [2008] 305 ITR 227 (SC), CIT vs. Aruna Luthra [2001] 252 ITR 76 (P&H)(FB)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Rectification of order
• Section: 154; 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN Before Shri Sanjay Arora, AccountantMemberand Shri Manomohan Das, JudicialMember MPNos. 41 & 42/Coch/2020 (Arising out of ITA Nos. 556 & 557/Coch/2017) (Assessment Years:2011-12 & 2012-13) The Income Tax Officer Ward -4, Kannur Vs. M/s. Kurumattur Service Co- operativeBank Ltd. Kurumathur, Taliparamba Kannur 670142 PAN – AACCK6521H Applicant Respondent (Represented by Smt. Parvathi Ammal, CA) MPNo. 122/Coch/2020 (Arising out of ITA No. 489/Coch/2017) (Assessment Year: 2013-14) The Income Tax Officer Ward -2(5), Kozhikkode Vs. M/s. TharuvannaService Co- operativeBank Ltd. Tharuvanna P.O. Mananthavady, Wayanad PAN – AACAT0810C Applicant Respondent (Represented by None) MPNo. 123/Coch/2020 (Arising out of ITA No. 400/Coch/2017) (Assessment Year: 2013-14) The Income Tax Officer Ward - 2), Tirur Vs. M/s. Nilambur Service Co-operative Bank Ltd. Chadakkunnu P.O. Malappuram 676329 PAN – AABAN8659C Applicant Respondent (Represented by M/s. Telma Raju, Advocate) MP No. 41/Coch/2020& Others ITO v. Kurumattur Service Co-operative Bank Ltd. & Ors. 2 MPNos. 159 & 160/Coch/2020 (Arising out of ITA Nos. 452 & 453/Coch/2017) (Assessment Year: 2007-08& 2012-13) The Income Tax Officer Ward – 2(1), Kozhikode Vs. M/s. Kottur Service Co- Operative Bank Ltd. Avidanallur P.O., Kozhikode PAN – AABAK6702D Applicant Respondent (Represented by None)) Date of Hearing: 14.07.2023 Date of Pronouncement: 02.08.2023 O R D E R Per: Sanjay Arora, AM The captioned miscellaneous petitions (MPs) by the Revenue under section 254(2) of the Income Tax Act, 1961 (‘the Act’) involving a common issue, were posted for hearing and, accordingly, heard together, and which also explains their disposal per a common order for the sake of convenience. 2. The order u/s. 254(1) of the Act by the Tribunal in all the appeals giving rise to the instant MPs was passed by it following the decision by the Hon'ble jurisdictional High Court in Chirakkal Service Co-operative Bank Ltd. vs. CIT [2016] 384 ITR 490 (Ker), on it being held as no longer good law per it’s subsequent decision in CIT vs. Poonjar Service Co-operative Bank Ltd. [2019] 414 ITR 67 (Ker)(FB) dated 19.3.2019, confirming it’s earlier decision in Perinthalmanna Service Co-operative Bank Ltd. [2014] 363 ITR 268 (Ker). The same were accordingly filed on 30.09.2019. The assessees, on the other hand, plead non-maintainability thereof in view of the time limitation attending the filing of the instant MPs. On merits, it is stated that the decision in Poonjar Service Co-operative Bank Ltd. (supra) obtains no longer, having been since reversed in Mavilayi Service Co-operative Bank Ltd. vs. Pr. CIT [2021] MP No. 41/Coch/2020& Others ITO v. Kurumattur Service Co-operative Bank Ltd. & Ors. 3 431 ITR 1 (SC). Reinstating the appeals, accepting the MPs, would therefore be an exercise in futility. 3. We have heard the rival contentions, and perused the material on record. 3.1 We tabulate here-in-below, for ready reference, the date of passing of the impugned orders along with the date of filing the corresponding MP by the Revenue: MP No. Date of Tribunal Order Date of filing MP 41/Coch/2020 03.07.2018 30.09.2019 42/Coch/2020 03.07.2018 30.09.2019 122/Coch/2020 08.03.2018 30.09.2019 123/Coch/2020 01.02.2018 30.09.2019 159/Coch/2020 14.06.2018 30.09.2019 160/Coch/2020 14.06.2018 30.09.2019 3.2 As apparent, all the impugned orders are passed after 01.06.2016, whereat the time limitation for filing a Miscellaneous Application u/s.254(2) of the Act stood reduced, from the erstwhile four years from the date of the order sought to be rectified, to six months from the end of the month in which the said order was passed, i.e., by Finance Act, 2016, w.e.f. 01.06.2016. The date of filing the MPs in all the instant cases is 30.9.2019 and, thus, the applications are, as apparent, out of time, i.e., barred by time. The Revenue’s reliance on the decision in Kil Kotagari Tea & Coffee Estates Co. Ltd. vs. ITAT [1988] 174 ITR 579 (Ker) is misplaced. The same clarifies, inter alia, that the decision by the High Court or Supreme Court shall have retrospective operation. Rectification u/s. 154 or, as the case may be, s. 254(2) of the Act, can arise on it’s basis, even if rendered subsequent to the order sought to be amended, i.e., where it is inconsistent with the decision by the said Courts. The same in fact represents trite law, as once the law is interpreted by a constitutional court, the same is to be read as it always was. That is, the law, irrespective of the date of pronouncement of the judgement, is to be read as declared since its inception. MP No. 41/Coch/2020& Others ITO v. Kurumattur Service Co-operative Bank Ltd. & Ors. 4 Reference in this context may also be made to decisions in Asst. CIT v. Saurashtra Kutch Stock Exchange Ltd. [2008] 305 ITR 227 (SC); and CIT v. Aruna Luthra [2001] 252 ITR 76 (P&H)(FB), to cite two. 3.3 The same, however, to be given effect to, would require rectification provision in its respect having been invoked within a statutory time limit. True, any court or tribunal has an inherent power to rectify the mistake in its order inasmuch as no court or tribunal can, by its error or omission, cause prejudice to either side before it. Section 254(2) of the Act, however, places a limitation of time within which the Tribunal can do so. The delay in filing the rectification application, which the Tribunal has no power to condone, would operate to oust the jurisdiction of the Tribunal in passing a rectification order inasmuch as it’s order is to be within the time limit prescribed by the statute therefor. Even if non-applicability of the said time limitation was to be argued on the basis of the principle of acutus curiae neminem gravabit, or otherwise taken account of, the instant, it needs to be borne in mind, is not a case of suo motu rectification, but only one following a reversal by the Hon’ble High Court of it’s earlier decision, obtaining at the relevant time. There has been, therefore, no mistake or omission by the Tribunal per se, and it’s order becomes mistaken, liable for amendment, in view of the subsequent decision on a question of law by the Hon’ble jurisdictional High Court. 3.3 Continuing further, the decision in Kil Kotagiri Tax & Coffee Estates Co. Ltd. (supra), even as it provides a legal basis for the Revenue to initiate the rectification proceedings, the same would have necessarily to be within the time limit provided in its respect by law. The instant MPs are thus barred by time. We decide accordingly. MP No. 41/Coch/2020& Others ITO v. Kurumattur Service Co-operative Bank Ltd. & Ors. 5 4. In the result, the captioned MPs by the Revenue are dismissed as not maintainable. Order pronounced on August02, 2023 under Rule 34 of The Income Tax (Appellate Tribunal) Rules, 1963. Sd/- Sd/- (Manomohan Das) (Sanjay Arora) Judicial Member Accountant Member Cochin, Dated: August02, 2023 Copy to: 1. The Appellant 2. The Respondent 3. The CIT concerned 4. The DR, ITAT, Cochin 5. Guard File By Order Assistant Registrar ITAT, Cochin n.p.