Bharat Overseas Bank Ltd., CHENNAI V. Additional CIT, CHENNAI

MA 234/CHNY/2011

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 7362 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 5 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 16-12-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 11-11-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Reasonable cause; Bad and doubtful debts
• Section: 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER, AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER .. M.P. NO. 234/MDS/2011 (IN M.P. NO. 151/MDS/2011 ARISING OUT OF I.T.A. NO. 96/MDS/2010) ASSESSMENT YEAR : 2006-07 M/S BHARAT OVERSEAS BANK LTD., (SINCE TAKEN OVER BY INDIAN OVERSEAS BANK), 763, ANNA SALAI, CHENNAI 600 002. PAN : AAACB1374M (PETITIONER) V. THE ADDITIONAL COMMISSIONER OF INCOME TAX, COMPANY RANGE I, CHENNAI 600 034. (RESPONDENT) PETITIONER BY : SHRI C. NARESH, C.A. RESPONDENT BY : SHRI K.E.B. RANGARAJAN, JUNIOR STANDING COUNSEL DATE OF HEARING : 09.12.2011 DATE OF PRONOUNCEMENT: O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : THIS IS A MISCELLANEOUS PETITION FILED BY THE ASS ESSEE AGAINST THE ORDER OF THIS TRIBUNAL IN M.P. NO. 151/MDS/2011 . AS PER THE ASSESSEE, THOUGH COD IN ITS MEETING HELD ON 28.10.2 010 DENIED IT M.P. NO. 234/MDS/11 2 PERMISSION TO MOVE THIS TRIBUNAL IN RESPECT OF AN I SSUE RELATING TO RURAL BAD DEBTS WRITTEN OFF, BY VIRTUE OF THE DECIS ION OF HON'BLE APEX COURT IN THE CASE OF ELECTRONICS CORPORATION OF IND IA LTD. V. UNION OF INDIA (322 ITR 58) ITS APPEAL OUGHT HAVE BEEN CONSI DERED. 2. WHEN THE PETITION WAS TAKEN UP, LEARNED A.R. ARG UED THAT IN SIMILAR CIRCUMSTANCES, DEPARTMENTS M.P. NO. 162/MD S/2011 WAS ACCEPTED BY THE TRIBUNAL AND DEPARTMENT WAS PERMITT ED TO PURSUE APPEAL IN I.T.A. NO. 1566/MDS/2008. 3. PER CONTRA, LEARNED D.R. SUPPORTED THE ORDER OF THE TRIBUNAL IN M.P. NO. 151/MDS/2011. 4. WE HAVE PERUSED THE ORDERS AND HEARD THE RIVAL C ONTENTIONS. GRIEVANCE OF THE ASSESSEE IS THAT IN ONE M.P., THIS TRIBUNAL HAD DISMISSED ITS PLEA, WHEREAS IN ANOTHER, IT HAD ALLO WED ITS PLEA FOR PURSUING AN APPEAL ON A MATTER ON WHICH PERMISSION WAS DENIED BY THE COD. IN M.P. NO. 151/MDS/11 AGAINST WHICH THIS M.P. IS FILED, AT PARA NO.4, REASONS WERE GIVEN WHY THE DECISION OF H ON'BLE APEX COURT IN THE CASE OF ELECTRONICS CORPORATION OF IND IA LTD. (SUPRA) WILL NOT HAVE EFFECT ON PERMISSIONS ALREADY GRANTED OR P ERMISSION ALREADY M.P. NO. 234/MDS/11 3 DENIED BY THE COD. WHETHER ANOTHER ORDER OF THE TR IBUNAL ON A SIMILAR MATTER, WHICH HAS NOT DISCUSSED THE ISSUE R EGARDING APPLICABILITY OF THE ORDER OF THE HON'BLE APEX COUR T IN SO FAR IT RELATED TO AN ISSUE WHERE THERE WAS A SPECIFIC DENIAL BY TH E COD, CAN BE A REASON FOR RECALL OF THE IMPUGNED ORDER IS A DEBATA BLE ISSUE. IT CANNOT BE A SUBJECT MATTER OF A PETITION FOR RECTIF ICATION UNDER SECTION 254(2) OF THE ACT. 5. IN ANY WAY, THERE CANNOT BE AN M.P. IN M.P. IS S ETTLED BY THE LAW OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CAS E OF DR. S. PANNEERSELVAM V. ACIT (319 ITR 135). RELEVANT PARA S 4 TO 6 OF THE ORDER OF HON'BLE JURISDICTIONAL HIGH COURT, ARE REP RODUCED HEREUNDER FOR EASY UNDERSTANDING:- 4. THEREAFTER, THE WRIT PETITIONER/ASSESSEE IN BOT H WRIT PETITIONS HAS FILED ONE MORE MISC. PETN. NO.92 OF 2 003 FOR FURTHER RECTIFICATION. THE TRIBUNAL DISMISSED THE PETITION HOLDING AS FOLLOWS:- 3. WE HAVE HEARD AND PERUSED THE MATERIAL ON RECOR D. ADMITTEDLY THE EARLIER MISCELLANEOUS PETITION OF THE ASSESSEE BEARING NO.38 OF 2001 WAS DISPOSED OF BY THIS TRIBUN AL VIDE ORDER DT. 25 TH APRIL, 2001 IN RELATION TO IT APPEAL NO.2151 AND MISC. PETN. NO.17 OF 2001 WAS DISPOSED OF BY THIS TR IBUNAL ON 25 APRIL, 2001 IN RELATION TO IT APPEAL NOS. 2457 AND 2458 OF 1993 M.P. NO. 234/MDS/11 4 AND 2501 AND 2502 OF 1993 FOR THE ASST. YRS. 1982-83 AND 1983- 84, 1984-85 AND 1987-88. HENCE THIS IS THE SECOND MISCELLANEOUS PETITION BY THE ASSESSEES FOR THE YEARS 1984-85 AND 1987-88. AS PER S. 254(2), THE TRIBUNAL HAS NO POWER TO PASS ORDER IN MISCELLANEOUS PETITION ON MISCELLANEOUS PETITION. THIS VIEW IS ALSO SUPPORTED BY THE JUDGEMENT OF HON'BLE ORISSA HIGH CO URT IN THE CASE OF CIT VS. ITAT & ORS. (1992) 102 CTR (ORI) 28 1 : (1992) 196 ITR 640 (ORI). ACCORDINGLY THE MISCELLANEOUS PE TITION IS DISMISSED. 5. ON GOING THROUGH THE AVERMENTS MADE IN THE AFFID AVITS FILED IN SUPPORT OF THE WRIT PETITIONS, IT IS CLEAR THAT THE WRIT PETITIONER HAS AT THE FIRST INSTANCE FILED AN APPLI CATION MISC. PETN. NO.17 OF 2001 FOR RECTIFICATION WHICH HAS BEE N ALLOWED ON 25 TH APRIL, 2001. THEREAFTER, AFTER MORE THAN TWO YEARS , PETITIONER FILED ANOTHER RECTIFICATION PETITION FOR RECTIFYING THE ORIGINAL ORDER OF THE TRIBUNAL DT. 27 TH NOV., 2000. 6. THE TRIBUNAL TOOK THE VIEW THAT THE SECOND MISCE LLANEOUS PETITION CANNOT BE FILED FOR RECTIFICATION OF THE O RIGINAL ORDER ONCE OVER. IT RELIED UPON THE DECISION OF A DIVISI ON BENCH OF ORISSA HIGH COURT IN CIT VS. ITAT & ORS. (1992) 102 CTR (ORI) 281 : (1992) 196 ITR 640 (ORI). THE ORISSA HIGH CO URT CONSIDERING THE SCOPE AND AMBIT OF APPLICATION OF S . 254(2) OF THE I.T. ACT, 1961, HELD AS FOLLOWS: THE SCOPE AND AMBIT OF AN APPLICATION OF S. 254(2) IS VERY LIMITED. THE SAME IS RESTRICTED TO RECTIFICATION O F MISTAKES APPARENT FROM THE RECORD. WE SHALL FIRST DEAL WITH THE QUESTION OF THE POWER OF THE TRIBUNAL TO RECALL AN ORDER IN ITS ENTIRETY. RECALLING THE ENTIRE ORDER OBVIOUSLY WOULD MEAN PASS ING OF A FRESH ORDER. THAT DOES NOT APPEAR TO BE THE LEGISL ATIVE INTENT. THE ORDER PASSED BY THE TRIBUNAL UNDER S. 154(1) IS EFFECTIVE ORDER SO FAR AS THE APPEAL IS CONCERNED. ANY ORDER PASSED UNDER S. 254(2) EITHER ALLOWING AMENDMENT OR REFUSING TO AMEND GETS MERGED WITH THE ORIGINAL ORDER PASSED. THE ORDER A S AMENDED OR M.P. NO. 234/MDS/11 5 REMAINING UNAMENDED IS THE EFFECTIVE ORDER FOR ALL PRACTICAL PURPOSES. THE SAME CONTINUES TO BE AN ORDER UNDER S. 154(1). THAT IS THE FINAL ORDER IN THE APPEAL. AN ORDER UN DER S. 254(2) DOES NOT HAVE EXISTENCE DE HORS THE ORDER UNDER S. 254(1). RECALLING OF THE ORDER IS NOT PERMISSIBLE UNDER S. 254(2). RECALLING OF AN ORDER AUTOMATICALLY NECESSITATES REH EARING AND READJUDICATION OF THE ENTIRE SUBJECT-MATTER OF APPE AL. THE DISPUTE NO LONGER REMAINS RESTRICTED TO ANY MISTAKE SOUGHT TO BE RECTIFIED. POWER TO RECALL AN ORDER IS PRESCRIBED IN TERMS OF R. 24 OF THE ITAT RULES, 1963, AND THAT TOO ONLY IN CASES WHERE THE ASSESSEE SHOWS THAT IT HAD A REASONABLE CAUSE FOR B EING ABSENT AT A TIME WHEN THE APPEAL WAS TAKEN UP AND WAS DECI DED EX PARTE. NO DOUBT, IN THE ABOVE CASE, THE QUESTION WAS WHETH ER THE TRIBUNAL CAN RECALL THE ORDER IN ITS ENTIRETY EXERCI SING THE POWER UNDER S. 254(2) OF THE I.T. ACT, 1961. THE COURT, HOWEVER, HELD THAT ANY ORDER PASSED UNDER S. 254(2) EITHER ALLOWIN G AMENDMENT OR REFUSING TO AMEND GETS MERGED WITH THE ORIGINAL ORDER PASSED. THE ORDER AS AMENDED OR REMAINING UNAMENDED IS THE EFFECTIVE ORDER FOR ALL PRACTICAL PURPOSES. THE SAME CONTINU ES TO BE AN ORDER UNDER S. 254(1). THAT IS THE FINAL ORDER IN THE APPEAL. IN THE PRESENT CASE, THE RECTIFICATION WAS ORDERED IN TERMS OF S. 254(2) AND IT GOT MERGED WITH THE ORIGINAL ORDER PA SSED UNDER S. 254(1). WHAT HAS BEEN REFUSED BY THE TRIBUNAL WHILE ALLOWING THE APPLICATION UNDER S. 254(2) SHOULD BE READ AS H AVING BEEN REJECTED. THEREFORE, THE PETITIONER CANNOT FILE AN OTHER APPLICATION TO GRANT FURTHER BENEFITS. SUCCESSIVE APPLICATION FOR RECTIFICATION OF THE ORIGINAL ORDER CANNOT BE MAINT AINED AS IT WILL DEFEAT THE OBJECT OF S. 254(2) OF THE ACT. SEC. 25 4(2) OF THE I.T. ACT, 1961, PROVIDES FOR RECTIFICATION OF ANY MI STAKE APPARENT FROM THE ORDER PASSED BY IT UNDER S. 254(1) OF THE A CT. ONCE THIS HAS BEEN DONE, NO FURTHER APPLICATION IS MAINT AINABLE. THE REMEDY BY WAY OF APPEAL IS THE ONLY COURSE OPEN. M.P. NO. 234/MDS/11 6 6. WHAT CAN BE CONSIDERED FOR RECTIFICATION IS ONLY A MISTAKE WHICH IS GLARING FROM THE RECORD AND NOT SOMETHING WHICH REQUIRES LONG AND DETAILED DEBATE TO GET ESTABLISHED, AND THIS IS TRI TE LAW. 7. WE ARE, THEREFORE, OF THE OPINION THAT WHAT THE ASSESSEE IS SEEKING IS A REVIEW OF AN ORDER, THAT TOO AN ORDER PASSED UNDER SECTION 254(2) OF THE ACT. WE, THEREFORE, FIND NO MERITS IN THIS MISCELLANEOUS PETITION. 8. IN THE RESULT, MISCELLANEOUS PETITION FILED BY T HE ASSESSEE IS DISMISSED. THE ORDER WAS PRONOUNCED IN THE COURT ON 16 TH DECEMBER, 2011. SD/- SD/- (HARI OM MARATHA) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 16 TH DECEMBER, 2011. KRI. COPY TO: (1) PETITIONER (2) RESPONDENT (3) CIT(A) (4) CIT (5) D.R. (6) GUARD FILE