A.C.I.,Circle-3, Kolkata, Presently D.C.I.T., Circle-1(1), Kolkata, Kolkata V. The Peerless General Finance & Investment Co. Ltd., Kolkata

MA 2/KOL/2023

AI Insights

The case involves a miscellaneous application by the Revenue under section 254(2) of the Income-tax Act, 1961, seeking to recall an earlier order of the Tribunal dated 19.06.2019 for the assessment year 1985-86. The application was filed with a significant delay of 1101 days, and the Revenue sought condonation for this delay. The Tribunal examined the provisions of section 254(2) and relevant judicial precedents to determine whether it had the authority to condone the delay. The Tribunal concluded that it lacked such authority, leading to the dismissal of the application.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 125612 (ITAT-KOLKATA)
• Duration Of Justice: 6 month(s) 21 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-07-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: misc
• Appeal Filed On: 05-01-2023
• Other Referred Cases: PCIT vs. ITAT [2020] 116 taxmann.com 451 (Bom), Shri Muninaga Reddy vs. ACIT in Writ Petition No. 25553/2018 (T-IT) dated 12.07.2018, Arvindbhai H. Shah vs. ACIT [2004] 91 ITD 101 (Ahd) (SB)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Period of limitation; Time period of passing order
• Section: 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH KOLKATA BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER MA No.2/Kol/2023 In ITA No.2764/Kol/2003 Assessment Year: 1985-86 Assistant Commissioner of Income-tax, Circle-3, Kolkata (presently Deputy Commissioner of Income-tax, Circle-1(1), Kolkata.) Vs. The Peerless General Finance & Investment Co. Ltd. 3, Esplanade East, Kolkata- 700069. (PAN: AABCT3043L) (Applicant) (Respondent) Present for: Applicant by : Shri S. K. Tulsiyan, Advocate Respondent by : Shri Vijay Kumar Addl. CIT Date of Hearing : 19.05.2023 Date of Pronouncement : 27.07.2023 O R D E R PER GIRISH AGRAWAL, ACCOUNTANT MEMBER: The present miscellaneous application is by the Revenue under section 254(2) of the Income-tax Act, 1961 (hereinafter referred to as the Act) with a prayer to recall the order of Tribunal in ITA No. 2764/Kol/2003, pronounced on 19.06.2019, for AY 1985-86. 2. At the outset, we note that registry has recorded a delay of 1101 days in filing this present miscellaneous application. Revenue has placed on record a petition for condonation of this delay vide its application dated 24.02.2023. In this petition, for the factual position, it is stated that ‘an order was passed by Hon’ble ITAT, Kolkata on MA No. 2/Kol/2023 The Perless General Finance & Inv. Co. Ltd., AY: 1985-86 2 19.06.2019 and accordingly the limitation date for filing appeal before the Hon’ble ITAT, Kolkata was 31.12.2019.” 2.1. Reasons for the cause of delay are explained seeking condonation of the same. It is further stated that this miscellaneous application was filed on 06.01.2023. It is prayed in this petition that ‘the unintended delay of 1101 days i.e. 01.01 2020 to 06.01 2023 in filing the appeal may please be condoned.’ 3. Jurisdiction of the Tribunal under section 254(2) of the Act is sance the power to condone the delay in filing the miscellaneous application in the present case. In this regard, we first refer to the provisions contained in section 254(2) of the Act, which reads as under: (2) the Appellant Tribunal may, at any time within six months from the end of the month in which the order was passed, with a view to rectifying any mistake apparent from the record, and any order passed by it under sub- section (1), and shall make such amendment if the mistake is brought to its notice by the assessee or the Assessing Officer: Provided that an amendment which has the effect of enhancing and assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this sub-section unless the Appellate Tribunal has given notice to the assessee of its intention to do so and has allowed the assessee are reasonable opportunity of being heard. 4. From the reading of the above stated provision of sub-section (2) of section 254 of the Act, it is noted that Tribunal is vested with the power to rectify any mistake apparent from record, to amend any order passed by it under sub-section (1) of section 254 at any time within six months from the end of the month in which the order was passed. The mistake may be brought to the notice of the Tribunal by the assessee or by the Assessing Officer. MA No. 2/Kol/2023 The Perless General Finance & Inv. Co. Ltd., AY: 1985-86 3 5. Admittedly, it is a fact on record that the order of the Tribunal dated 19.06.2019 was received by the Department on 30.06.2019. Thus this miscellaneous application ought to have been filed by the Department within six months i.e. on or before 31.12.2019. However, it has been filed on 06.01 2023 which is beyond the prescribed limitation of six months, resulting in a delay of 1101 days. 6. We note that power to condone the delay with the Tribunal can only be exercised if it is specifically provided in the statue itself. Relevant statue carves out exceptions by granting the competent authority, power to entertain an appeal or application beyond the prescribed period on sufficient cause. It is in the hue of such an express authorisation that the concerned authority can exercise its discretion and condone the delay, if satisfied with the reasonableness of the cause in late presentation. 6.1. Section 253(3) requires the filing of an appeal before the Tribunal within 60 days, sub-section (5) empowers the Tribunal to admit an appeal after the expiry of period of 60 days. As against this power of the Tribunal to admit an appeal belatedly after the expiry of relevant period in terms of sub-section (5) of section 253, no specific provision has been enshrined, empowering the Tribunal to entertain a miscellaneous application under section 254(2) of the Act beyond the period of six months from the end of the month in which the order was passed. 7. Hon’ble High Court of Bombay in the case of PCIT vs. ITAT [2020] 116 taxmann.com 451 (Bom) had an occasion to deal with the issue in hand before us and it was held that, “From a careful reading of the provision of section 254(2), it is seen that Tribunal is vested with the power to rectify any mistake apparent from the record to amend any order passed by it under sub-section (1) of section 254 at any time within six months from the end of the month in which the order was MA No. 2/Kol/2023 The Perless General Finance & Inv. Co. Ltd., AY: 1985-86 4 passed, provided the mistake is brought to its notice by the assessee or by the Assessing Officer. The use of the expression ‘may’ in the aforesaid provision is clearly indicated of the legislative intent that the limitation period of six months from the end of the month in which the order was passed is not to be construed in such a manner that there cannot be any extension of time beyond the said period of six months. This is so because the assessee or the Assessing Officer can only bring the mistake to the notice of the Tribunal. The assessee or the Assessing Officer has no control over the Tribunal. For one reason or the other, the Tribunal may not be in a position to pass the order under section 254(2). For the inability of the Tribunal to pass such an order within the period provided, neither the assessee nor the Revenue should suffer. What therefore becomes relevant is that the assessee or the Assessing Officer should bring the mistake to the notice of the Tribunal within the limitation period.” 7.1. Hon’ble High Court of Karnataka in the case of Shri Muninaga Reddy vs. ACIT in Writ Petition No. 25553/2018 (T-IT) dated 12.07.2018 held that whatever time-limit has been prescribed for filing of the miscellaneous application under the provisions of the Act that itself has to be followed by the Tribunal and it cannot condone the delay beyond the period specified under the provisions of the law. It was held that power to condone the delay with the Tribunal can only be exercised if it is specifically provided in the statute itself. As we have already examined so far as the Income-tax Act is concerned and in respect of the Tribunal it is with regard to the appeal and cross objection only such power is given if the Tribunal is satisfied about the sufficiency of the reasons about such delay as enshrined in clause 5 of section 253 of the Act but so far as section 254(2) is concerned, there is no excess power conferred on the Tribunal by the legislature in the statutes where the Tribunal can condone the delay based on the relevant period prescribed in the statutes therein. Inordinate delay in filing of M.A. is not a fit case for condition of delay more so when there is no specific provision in the realm of section to provide for such a condonation of delay. MA No. 2/Kol/2023 The Perless General Finance & Inv. Co. Ltd., AY: 1985-86 5 7.2. Hon’ble Special Bench of ITAT Ahmedabad in the case of Arvindbhai H. Shah vs. ACIT [2004] 91 ITD 101 (Ahd) (SB) held as under, when the prescribed period of limitation was four years instead of present limitation of six months: “25. ............... In the said circumstances, when a period of limitation of four years is provided under section 254(2) for rectifying an order, no rectification can be made after that period on the principle of equity and justice or on the basis of theory that justice should be done, even if heaven falls, as even period of limitation is part of the jurisprudence and cannot be brushed aside or ignored to grant relief on the prayer of the assessee or revenue after the expiry of said period of four years. 26. In view of the above, the time-limit of four years to make rectification applies both to suo moto action of the Tribunal as well as action taken on request of the parties. The miscellaneous application of the assessee filed on11-4-2002 for rectifying an order of the Tribunal dated 28-4-1997 was barred by limitation and the Tribunal could not make any rectification of its order on the prayer of the assessee as the time-limit four years from the date of the order had already expired.” 8. In view of the above undisputed facts in the present case and respectfully following the jurisprudence referred above on the applicable provisions of the Act, if the Tribunal is not given that power, then it is not expected from the Tribunal to exercise such power not provided in the Act i.e. power to condone the delay in respect of filing of miscellaneous application under section 254(2), in the present case. Accordingly, the present miscellaneous application filed by the Revenue which is delayed by 1101 days is dismissed. The PAN of the assessee inadvertently typed as “AABFT5240Q” be read correctly as “AABCT3043L”. 9. In the result, Misc. Application of the revenue is dismissed. Order is pronounced in the open court on 27th July, 2023. Sd/- Sd/- (Sanjay Garg) (Girish Agrawal) Judicial Member Accountant Member Dated: 27th July, 2023 JD, Sr. P.S. MA No. 2/Kol/2023 The Perless General Finance & Inv. Co. Ltd., AY: 1985-86 6 Copy to: 1. The Applicant: 2. The Respondent: 3. CIT(A)- , Kolkata 4. CIT, Kolkata 5. DR, ITAT, Kolkata Bench, Kolkata //True Copy// By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata