IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR (VIRTUAL COURT) BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER M. A. No. 22/Asr/2023 (Arising out of ITA No. 145/Asr/2022) Assessment Year: 2017-18 M/s Torrent Roofing Systems, Plot No. 5C and 5D, Industrial Area, Gagret [PAN: AAHFT 1660L] (Appellant) V. Income Tax Officer, Ward -4, Hoshiarpur (Respondent) Appellant by : Sh. P. N. Arora, Adv. Respondent by : Dr. Vedanshu Tripathi, Sr. DR Date of Hearing : 22.05.2023 Date of Pronouncement : 07.06.2023 ORDER Per Dr. M. L. Meena, AM: This Miscellaneous Application was filed by the assessee against order of the ITAT dated 20.12.2022 in ITA No. 145/Asr/2022. 2. The appellant has filed the miscellaneous application on account of no reasonable and proper opportunity of being heard was allowed to the MA No. 22/Asr/2023 Torrent Roofing Systems v. ITO 2 assessee. He stated that the adjournment application filed was not decided and appeal was adjudicated ex-parte qua the assessee by the Tribunal. Accordingly, he prayed that the order of the Tribunal may be recalled in the ‘interest of natural justice’. 3. The ld. DR on the other side objected to the request of the ld. assessee. He contended that the adjournment application of the assessee was rejected in the open court on the date of hearing, i.e., 06.12.2022, and since, the Tribunal has passed an order on merits of the case, hence recalling of the order would be an attempt to revisit/review the speaking order passed on merits by the Tribunal which is not permitted under the provisions of section 254(2) of the Act. 4. We have heard the rival contentions, perused the material on record and the impugned order passed by the Tribunal vide order dated 20.12.2022. Admittedly, at the time of hearing, the adjournment application of the appellant was rejected in the open court on the date of hearing, i.e., 06.12.2022 and the appeal was heard on merits after hearing the ld. DR. The rejection of the adjournment application of the appellant is evident from the endorsement of the Hon’ble Members on the adjournment application itself which is reproduced as under: MA No. 22/Asr/2023 Torrent Roofing Systems v. ITO 3 MA No. 22/Asr/2023 Torrent Roofing Systems v. ITO 4 5. In the present case, the appellant has been granted adequate opportunities of being heard i.e. on 27.09.2022 10.11.2022 and 06.12.2022 to file written submission and present its contentions before the Tribunal in support of the grounds of appeal raised. Neither the appellant nor the AR for the appellant appeared and continued filing adjournment applications reiterating similar reasons. On the 3 rd date of hearing i.e. 06.12.202 the adjournment application of the appellant has been rejected by the Tribunal for insufficient reasons in the open court with the written endorsement on the application itself, as above and the appeal was decided on merits of the case after hearing the Ld. DR and considering the facts on record. 6. Without prejudice to the above, the matter has been restored to the CIT(A) to adjudicate the appeal afresh after consider the submission of the appellant and granting adequate opportunity of being heard. Meaning thereby, the appellant would not be placed in disadvantageous position rather, it would get another opportunity to establish its claim with supporting documentary evidences before the Ld. CIT(A). The Tribunal has passed a detailed order on merits of the case. At this stage, recalling of the Tribunal order would amount to revisit/review of the order passed by the co-ordinate bench which is not permitted under law in the light of the Hon’ble Apex Court in the case of Reliance Telecom Pvt. Ltd. v. Commissioner of Income MA No. 22/Asr/2023 Torrent Roofing Systems v. ITO 5 Tax (IT-4), Mumbai [2021] 133 taxmann.com 41 (SC), the relevant para of the judgment is as under: “Section 254, read with sections 9 and 195, of the Income-tax Act, 1961 - Appellate Tribunal - Powers of (Recalling of order) - Assessee-company entered into a supply contract with a non-resident company - It had filed an application before Assessing Officer under section 195(2) to make payment to a non-resident company for purchase of software without deducting tax at source on ground that said company had no Permanent Establishment (PE) in India and in terms of DTAA between India and Sweden & USA, no tax was to be deducted in India on such purchase - Assessing Officer rejected application of assessee holding that payment made for purchase of software was in nature of royalty and was taxable in India under section 9(1)(vi) and, accordingly, assessee was liable to deduct tax at source at rate of 10 per cent on said payment - Tribunal also upheld said view taken by Assessing Officer by passing a detailed order - Subsequently, assessee filed a miscellaneous application under section 254 - Tribunal allowed said application in exercise of his powers under section 254(2) and re-heard entire appeal on merits and recalled its original order - Whether while considering application under section 254(2), Tribunal was not required to re-visit its original order and go in details on merits and completely recall its order as powers under provision of section 254(2) were only to rectify/correct any mistake apparent from record - Held, yes - Whether, therefore, impugned order passed by Tribunal recalling its detailed original order passed during appellate proceedings was to be set aside and its original order was to be restored - Held, yes [Para 7] [In favour of revenue] 3.2 Having gone through both the orders passed by the ITAT, we are of the opinion that the order passed by the ITAT dated 18-11-2016 recalling its earlier order dated 6-9-2013 is beyond the scope and ambit of the powers under section 254(2) of the Act. While allowing the application under section 254(2) of the Act and recalling its earlier order dated 6-9-2013, it appears that the ITAT has re- heard the entire appeal on merits as if the ITAT was deciding the appeal against the order passed by the C.I.T. In exercise of powers under section 254(2) of the Act, the Appellate Tribunal may amend any order passed by it under sub-section (1) of section 254 of the Act with a view to rectifying any mistake apparent from the record only. Therefore, the powers under section 254(2) of the Act are akin to Order XLVII Rule 1 CPC. While considering the application under section 254(2) MA No. 22/Asr/2023 Torrent Roofing Systems v. ITO 6 of the Act, the Appellate Tribunal is not required to re-visit its earlier order and to go into detail on merits. The powers under section 254(2) of the Act are only to rectify/correct any mistake apparent from the record. 4. In the present case, a detailed order was passed by the ITAT when it passed an order on 6-9-2013, by which the ITAT held in favour of the Revenue. Therefore, the said order could not have been recalled by the Appellate Tribunal in exercise of powers under section 254(2) of the Act. If the Assessee was of the opinion that the order passed by the ITAT was erroneous, either on facts or in law, in that case, the only remedy available to the Assessee was to prefer the appeal before the High Court, which as such was already filed by the Assessee before the High Court, which the Assessee withdrew after the order passed by the ITAT dated 18-11-2016 recalling its earlier order dated 6-9-2013. Therefore, as such, the order passed by the ITAT recalling its earlier order dated 6-9-2013 which has been passed in exercise of powers under section 254(2) of the Act is beyond the scope and ambit of the powers of the Appellate Tribunal conferred under section 254(2) of the Act. Therefore, the order passed by the ITAT dated 18-11-2016 recalling its earlier order dated 6-9-2013 is unsustainable, which ought to have been set aside by the High Court. 5. From the impugned judgment and order passed by the High Court, it appears that the High Court has dismissed the writ petitions by observing that (i) the Revenue itself had in detail gone into merits of the case before the ITAT and the parties filed detailed submissions based on which the ITAT passed its order recalling its earlier order; (ii) the Revenue had not contended that the ITAT had become functus officio after delivering its original order and that if it had to relook/revisit the order, it must be for limited purpose as permitted by section 254(2) of the Act; and (iii) that the merits might have been decided erroneously but ITAT had the jurisdiction and within its powers it may pass an erroneous order and that such objections had not been raised before ITAT. 6. None of the aforesaid grounds are tenable in law. Merely because the Revenue might have in detail gone into the merits of the case before the ITAT and merely because the parties might have filed detailed submissions, it does not confer jurisdiction upon the ITAT to pass the order de hors section 254(2) of the Act. As observed hereinabove, the powers under section 254(2) of the Act are only to correct and/or rectify the mistake apparent from the record and not beyond that. Even the observations that the merits might have been decided erroneously and the ITAT had jurisdiction and within its powers it may pass an MA No. 22/Asr/2023 Torrent Roofing Systems v. ITO 7 order recalling its earlier order which is an erroneous order, cannot be accepted. As observed hereinabove, if the order passed by the ITAT was erroneous on merits, in that case, the remedy available to the Assessee was to prefer an appeal before the High Court, which in fact was filed by the Assessee before the High Court, but later on the Assessee withdrew the same in the instant case. 7. In view of the above and for the reasons stated above, the impugned common judgment and order passed by the High Court as well as the common order passed by the ITAT dated 18-11-2016 recalling its earlier order dated 6-9- 2013 deserve to be quashed and set aside and are accordingly quashed and set aside. The original orders passed by the ITAT dated 6-9-2013 passed in the respective appeals preferred by the Revenue are hereby restored.” 7. In the instant case, merely because the appellant has filed detailed submissions, it does not confer jurisdiction upon the ITAT to pass the order de hors section 254(2) of the Act. As observed hereinabove, the powers under section 254(2) of the Act are only to correct and/or rectify the mistake apparent from the record and not beyond that. 8. Respectfully, following Hon’ble Apex Court, in “Reliance Telecom Pvt. Ltd. v. Commissioner of Income Tax”, (Supra) the miscellaneous application of the applicant is rejected. 9. In the result, the miscellaneous application the assesse is dismissed. Order pronounced in the open court on 07 .06.2023 Sd/- Sd/- (Anikesh Banerjee) (Dr. M. L. Meena) Judicial Member Accountant Member *GP/Sr./P.S.* MA No. 22/Asr/2023 Torrent Roofing Systems v. ITO 8 Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By Order