Smt. M. Chandra, CHENNAI V. ACIT, CHENNAI

MA 251/CHNY/2016

• Counselvise Citation: [2017] 123 COUNSELVISE.COM (IT) 5486 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 29 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-09-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 16-06-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 05-10-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S NATARAJA
• Assessee Lawyers: S SRIDHAR
• Keywords: Rectification of order; Reasonable cause

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , ! , ' #$ BEFORE SHRI N.R.S.GANESAN, JUDICIAL MEMBER AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER M.P. NO.251/MDS./2016 (ITA NO. 587/MDS/2016 ASSESSMENT YEAR : 2011-12) SMT. M. CHANDRA , NO.14, PETERS ROAD, ROYAPETAH, CHENNAI 600 014. PAN ADEPC9042R ( /APPELLANT) VS THE ASSISTANT COMMISSIONER OF INCOME-TAX, NON-CORPORATE CIRCLE-11, CHENNAI. ( /RESPONDENT) / APPELLANT BY : MR.S.SRIDHAR,ADVOCATE / RESPONDENT BY : SHRI S.NATARAJA, JCIT, D.R / DATE OF HEARING : 07.07.2017 / DATE OF PRONOUNCEMENT: 04.09.2017 / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS MISCELLANEOUS PETITION FILED BY THE ASSESSEE SE EKING RECALL OF THE EXPARTE ORDER OF THE TRIBUNAL DATED 22.07.20 16 IN ITA NO.587/MDS./2016. - - MP 251/16 2 2. THE CONTENTION OF LD.A.R IS THAT THE TRIBUNAL DE CIDED THE DECIDED THE APPEAL OF THE ASSESSEE EXPARTE ON MERIT S, THOUGH NONE APPEARED ON BEHALF OF THE ASSESSEE ON THE SCHEDULED DATE OF HEARING ON 20.07.2016. FURTHER, LD.A.R SUBMITTED THAT NON-APP EARANCE OF THE ASSESSEE WAS CONSEQUENT TO THE CIRCUMSTANCES BEYOND HER CONTROL AND PRAYED THAT UNDER PROVISO BELOW RULE 24 OF THE APPEL LATE TRIBUNAL RULES, 1963, THE TRIBUNAL HAVE THE POWER TO RECALL THE ORDER AND THE ORDER OF TRIBUNAL MAY BE RECALLED. FURTHER, HE SUBMITTED THA T THE ASSESSEE, THOUGH RECEIVED THE NOTICE FIXING THE HEARING ON 20.07.201 6, DUE TO WEDDING IN THE ASSESSEES FAMILY, NOTICE WAS NOT HANDED OVER TH E ASSESSEES COUNSEL, HENCE, THE CASE WAS NOT REPRESENTED BY THE ASSESSEE S COUNSEL. FURTHER, HE SUBMITTED THAT GROUND NOS.3 & 5 RAISED IN HER A PPEAL WAS NOT ADJUDICATED BY THE TRIBUNAL. ACCORDING TO LD.A.R, AN OPPORTUNITY MAY BE GIVEN TO DECIDE THE ISSUE AFRESH AND THE ASSESSEE WA S PREVENTED BY SUFFICIENT CAUSE FOR NOT APPEARING BEFORE THE TRIBUN AL. 2.1 ON THE OTHER HAND, LD.D.R PUT ANY SERIOUS OBJE CTION TO RECALL THE EXPARTE ORDER DATED 22.07.2016 AS THE ASSESSEE HAS NOT SHOWN ANY REASONABLE CAUSE FOR HER NON-APPEARANCE BEFORE THIS TRIBUNAL ON 20.07.2016. 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. IN THIS CASE, THE TRIBUNAL GIVEN CATEGORICAL FINDING S ON THE ISSUE RAISED BY - - MP 251/16 3 THE ASSESSEE WITH REFERENCE TO THE APPLICATION OF PR OVISO TO SEC.14A READ WITH RULE-8D OF INCOME TAX RULES, 1962. NOW, THE LD.A .R WANTS TO TAKE HELP FROM RULE 24 OF THE APPELLATE TRIBUNAL READS AS FOLLOWS:- RULE-24 : WHERE ON THE DAY FIXED FOR HEARING OR ANY OTHER DA TE TO WHICH THE HEARING MAY BE ADJOURNED, THE APPELLANT DO ES NOT APPEAR IN PERSON OR THROUGH AN AUTHORISED REPRESENTATIVE WHEN THE APPEAL IS CALLED ON FOR HEA RING, THE TRIBUNAL MAY DISPOSE OF THE APPEAL ON MERITS AFT ER HEARING THE RESPONDENT: PROVIDED THAT WHERE AN APPEAL HAS BEEN DISPOSED OF A S PROVIDED ABOVE AND THE APPELLANT APPEARS AFTERWARDS AND SATISFIES THE TRIBUNAL THAT THERE WAS SUFFICIENT CAUS E FOR HIS NON-APPEARANCE WHEN THE APPEAL WAS CALLED ON FOR HEARING, THE TRIBUNAL SHALL MAKE AN ORDER SETTING AS IDE THE EX PARTE ORDER AND RESTORING THE APPEAL. 3.1 AS PER THE PROVISION OF THE RULES, THE ASSESSE E HAS TO SATISFY THE TRIBUNAL THAT THERE WAS SUFFICIENT CAUSE FOR HIS/HER NON-APPEARANCE. WHEN THE APPEAL IS CALLED FOR HEARING, THE ASSESSEE FAIL ED TO APPEAR BEFORE THE TRIBUNAL, WHICH RESULTED IN PASSING EXPARTE ORDER BY THE TRIBUNAL. 3.1 IN THE PRESENT CASE, THE ASSESSEE TOOK A BALD PLEA BEFORE US THAT THERE WAS A MARRIAGE IN THE ASSESSEES FAMILY. THE AS SESSEE DOES NOT SPELL OUT THE NAME OF THE PERSONS WHOSE MARRIAGE WAS THERE, THE DATE AND PLACE OF MARRIAGE, AND HOW THE ASSESSEE WAS RELATED TO SUCH PERSON. FURTHER, IT IS NOTICED FROM FILE THAT THE CASE WAS FIXED ON 17.05.2016, AT - - MP 251/16 4 THAT TIME NONE APPEARED FOR THE CASE OF ASSESSEE A ND THE CASE WAS ADJOURNED O 20.07.2016 BY ISSUING A REGISTERED RPAD . THERE WAS NO ALLEGATION FROM THE ASSESSEE THAT NOTICE WAS NOT SER VED. THE ONLY PLEA OF ASSESSEE IS THAT THERE WAS A MARRIAGE IN HER FAMILY , SO THE NOTICE WAS NOT HANDED OVER THE ASSESSEES COUNSEL AND IT WAS HANDED OVER BELATEDLY. THE REASONS ADVANCED BY THE ASSESSEE CANNOT BE GOOD OR SUFFICIENT REASON TO RECALL THE ORDER OF TRIBUNAL, WHICH WAS DECIDED ON MER IT. 3.2 IN OUR OPINION, THE LAW ASSISTS THOSE WHO ARE V IGILANT, NOT THOSE WHO SLEEP OVER THEIR RIGHTS. THIS PRINCIPLE IS EMBODI ED IN THE DICTUM: VIGILANTIBUS NON DOEMIENTIBUS JURA SUBVENIUNT. THE NON-APPEARANCE CANNOT BE CONDONED SIMPLY BECAUSE THE APPELLANTS C ASE IS HARD AND CALLS FOR SYMPATHY OR MERELY OUT OF BENEVOLENCE TO THE PA RTY SEEKING RELIEF. IN GRANTING THE INDULGENCE AND CONDONING THIS KIND OF APPROACH, IT MUST BE PROVED BEYOND THE SHADOW OF DOUBT THAT THE APPELLANT WAS DILIGENT AND WAS NOT GUILTY OF NEGLIGENCE, WHATSOEVER. THE SUFFICIE NT CAUSE MUST BE A CAUSE WHICH IS BEYOND THE CONTROL OF THE PARTY INVOK ING THE AID OF THE PROVISIONS. THE CAUSE FOR THE NON-APPEARANCE BEFORE US, WHICH BY DUE CARE AND ATTENTION, COULD HAVE BEEN AVOIDED, CANNOT BE A SUFFICIENT CAUSE WITHIN THE MEANING OF THE REASONABLE COST. WHERE NO NEGLIGENCE OR INACTION, OR WANT OF BONAFIDES CAN BE IMPUTED TO THE APPELLANT, A LIBERAL - - MP 251/16 5 CONSTRUCTION HAS TO BE MADE IN ORDER TO ADVANCE SUB STANTIAL JUSTICE. SEEKERS OF JUSTICE MUST COME WITH CLEAN HANDS. 3.3. THE OTHER CONTENTION OF THE LD.A.R IS THAT THE TRIBUNAL HAS NOT CONSIDERED ALL THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE. IT IS WELL SETTLED THAT STATUTORY AUTHORITY CANNOT EXERCISE PO WER OF REVIEW UNLESS SUCH POWER IS EXPRESSLY CONFERRED. THERE IS NO EXPRES S POWER OF REVIEW CONFERRED ON THIS TRIBUNAL. EVEN OTHERWISE, THE SCOPE OF REVIEW DOES NOT EXTENT TO RE-HEARING OF THE CASE ON MERIT. 4 . THE SCOPE AND AMBIT OF APPLICATION OF SECTION 254 (2) IS VERY LIMITED. THE SAME IS RESTRICTED TO RECTIFICATION OF 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 ENTI RE ORDER OBVIOUSLY WOULD MEAN PASSING OF A FRESH ORDER. THAT DOES NOT APPEAR TO BE THE LEGISLATIVE INTENT. THE ORDER PASSED BY THE TRIBUNAL UNDER S. 254 (1) IS THE EFFECTIVE ORDER SO FAR AS THE APPEAL IS CONCERNED. ANY ORDER PASSED UNDER S. 254(2) EITHER ALLOWING THE AMENDMENT OR REFUSING TO AMEND G ETS MERGED WITH THE ORIGINAL ORDER PASSED. THE ORDER AS AMENDED OR REMAI NING UN-AMENDED IS THE EFFECTIVE ORDER FOR ALL PRACTICAL PURPOSES. AN ORDER UNDER 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). RECAL LING OF AN ORDER AUTOMATICALLY NECESSITATES REHEARING AND READJUDICA TION OF THE ENTIRE - - MP 251/16 6 SUBJECT-MATTER OF APPEAL. THE DISPUTE NO LONGER REMA INS RESTRICTED TO ANY MISTAKE SOUGHT TO BE RECTIFIED. POWER TO RECALL AN O RDER IS PRESCRIBED IN TERMS OF RULE 24 OF THE ITAT RULES, 1963, AND THAT T OO ONLY IN CASE WHERE THE ASSESSEE SHOWS THAT IT HAD A REASONABLE CAUSE FO R BEING ABSENT AT A TIME WHEN THE APPEAL WAS TAKEN UP AND WAS DECIDED EX-P ARTE. JUDGED IN THE ABOVE BACKGROUND THE ORDER PASSED BY THE TRIBUNA L IS INDEFENSIBLE. 5. THE WORDS USED IN S. 254(2) ARE 'SHALL MAKE SUCH AMENDMENT, IF THE MISTAKE IS BROUGHT TO ITS NOTICE'. CLEARLY, IF THER E IS A MISTAKE, THEN AN AMENDMENT IS REQUIRED TO BE CARRIED OUT IN THE ORIG INAL ORDER TO CORRECT THAT PARTICULAR MISTAKE. THE PROVISION DOES NOT INDI CATE THAT THE TRIBUNAL CAN RECALL THE ENTIRE ORDER AND PASS A FRESH DECISI ON. THAT WOULD AMOUNT TO A REVIEW OF THE ENTIRE ORDER AND THAT IS NOT PERM ISSIBLE UNDER THE IT ACT. THE POWER TO RECTIFY A MISTAKE UNDER S. 254(2) CANNOT BE USED FOR RECALLING THE ENTIRE ORDER. NO POWER OF REVIEW HAS BE EN GIVEN TO THE TRIBUNAL UNDER THE IT ACT. THUS, WHAT IT COULD NOT DO D IRECTLY COULD NOT BE ALLOWED TO BE DONE INDIRECTLY. 6. THUS THE SCOPE AND AMBIT OF APPLICATION U/S. 254( 2) IS AS FOLLOWS: - - MP 251/16 7 (A) FIRSTLY, THE SCOPE AND AMBIT OF APPLICATION OF S. 254(2) OF IT ACT IS RESTRICTED TO RECTIFICATION OF THE MISTAKES APPAREN T FROM THE RECORD. (B) SECONDLY, THAT NO PARTY APPEARING BEFORE THE TR IBUNAL SHOULD SUFFER ON ACCOUNT OF ANY MISTAKE COMMITTED BY THE TRIBUNAL AN D IF THE PREJUDICE HAS RESULTED TO THE PARTY, WHICH PREJUDICE IS ATTRIBUTA BLE TO THE TRIBUNAL'S MISTAKE/ERROR OR OMISSION, AND WHICH AN ERROR IS A MANIFEST ERROR, THEN THE TRIBUNAL WOULD BE JUSTIFIED IN RECTIFYING ITS MISTA KE. THE 'RULE OF PRECEDENT' IS AN IMPORTANT ASPECT OF LEGAL CERTAINT Y IN THE RULE OF LAW AND THAT PRINCIPLE IS NOT OBLITERATED BY S. 254(2) OF T HE ACT AND NON- CONSIDERATION OF PRECEDENT BY THE TRIBUNAL CAUSES A PREJUDICE TO THE ASSESSEE. (C) THIRDLY, POWER TO RECTIFY A MISTAKE IS NOT EQUI VALENT TO A POWER TO REVIEW OR RECALL THE ORDER SOUGHT TO BE RECTIFIED. (D) FOURTHLY, UNDER S. 254(2) AN OVERSIGHT OF A FAC T CANNOT CONSTITUTE AN APPARENT MISTAKE RECTIFIABLE UNDER THE SECTION. (E) FIFTHLY, FAILURE ON THE PART OF THE TRIBUNAL TO CONSIDER AN ARGUMENT ADVANCED BY EITHER PARTY FOR ARRIVING AT A CONCLUSI ON IS NOT AN ERROR APPARENT ON RECORD, ALTHOUGH IT MAY BE AN ERROR OF JUDGEMENT. (F) SIXTHLY, EVEN IF ON THE BASIS OF A WRONG CONCLU SION THE TRIBUNAL HAS NOT ALLOWED A CLAIM OF THE PARTY IT WILL NOT BE A GROUN D FOR MOVING AN APPLICATION UNDER S. 254(2) OF THE ACT. (G) LASTLY, IN THE GARB OF AN APPLICATION FOR RECTI FICATION UNDER S. 254(2) THE ASSESSEE CANNOT BE PERMITTED TO REOPEN AND REARGUE THE WHOLE MATTER AS THE SAME IS BEYOND THE SCOPE OF S.254(2) OF THE IT ACT. - - MP 251/16 8 6.1. KEEPING IN MIND THE ABOVE PARAMETERS, NOW WE PR OCEED TO CONSIDER AND DISPOSE OF THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE AS UNDER. 6.2. IN THE INSTANT CASE, THE TRIBUNAL WHILE DECIDIN G THE APPEAL OF THE ASSESSEE VIDE ORDER DATED 22/07/2016 HAS CONSIDERED THE ENTIRE FACTS OF THE CASE AND DECIDED THEREON. IN THIS REGARD, WE WOU LD LIKE TO MENTION THAT IN THE ORDER, THE TRIBUNAL FIRST METICULOUSLY M ENTIONED THE FACTS OF THE CASE AND THE POINTS RAISED BY HER. THEREAFTER, THE TR IBUNAL CONSIDERED THE SAME AND PASSED A SPEAKING ORDER FOR NOT ENTERTAINI NG THE CLAIM OF THE ASSESSEE. 7. IN THE CASE OF CIT VS. KARAM CHAND THAPAR & BRO S. PVT. LTD. (176 ITR 535) (SC) WHEREIN HELD THAT THE DECISION OF THE TR IBUNAL HAS NOT TO BE SCRUTINISED SENTENCE BY SENTENCE MERELY TO FIND OUT WHETHER ALL FACTS HAVE BEEN SET OUT IN DETAIL BY THE TRIBUNAL OR WHETHER SOM E INCIDENTAL FACT WHICH APPEARS ON THE RECORD HAS NOT BEEN NOTICED BY THE TRIBUNAL IN ITS JUDGMENT. IF THE COURT, ON A FAIR READING OF THE JU DGMENT OF THE TRIBUNAL, FINDS THAT IT HAS TAKEN INTO ACCOUNT ALL RELEVANT M ATERIAL AND HAS NOT TAKEN INTO ACCOUNT ANY IRRELEVANT MATERIAL IN BASING ITS CONCLUSIONS, THE DECISION - - MP 251/16 9 OF THE TRIBUNAL IS NOT LIABLE TO BE INTERFERED WITH, UNLESS, OF COURSE, THE CONCLUSIONS ARRIVED AT BY THE TRIBUNAL ARE PERVERSE. IT IS NOT NECESSARY FOR THE TRIBUNAL TO STATE IN ITS JUDGEMENT SPECIFICALLY OR IN EXPRESS WORDS THAT IT HAS TAKEN INTO ACCOUNT THE CUMULATIVE EFFECT OF THE CIRCUMSTANCES OR HAS CONSIDERED THE TOTALITY OF THE FACTS, AS IF THAT WER E A MAGIC FORMULA; IF THE JUDGEMENT OF THE TRIBUNAL SHOWS THAT IT HAS, IN FACT, DONE SO, THERE IS NO REASON TO INTERFERE WITH THE DECISION OF THE TRIBUNA L. 8. IN THE RESULT, THE MISCELLANEOUS PETITION FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON MONDAY, THE 4 TH OF SEPTEMBER, 2017 AT CHENNAI. SD/- SD/- ( . . . ) ( !'# $ % ) & N.R.S.GANESAN ' &()*+,-* .//0*-1' 23 45 /JUDICIAL MEMBER 456788/9+:*+: ;<=><- !2 /CHENNAI, ?4' /DATED, THE 4 TH SEPTEMBER, 2017. KSSUNDARAM 4 3@A BA / COPY TO: 1 . / APPELLANT 3. C &' / CIT(A) 5. AD 33EF / DR 2. / RESPONDENT 4. C / CIT 6. GH I / GF