Income Tax Officer, Ward-2., Khammam V. Bodepudi Nageswara Rao, Khammam

MA 32/Hyd/2020

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 0985 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 12 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 22-02-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB-B
• Next Hearing Date: 05-02-2021
• Assessment Year: 2009-2010
• Appeal Filed On: 10-07-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V V S T SAI
• Assessee Lawyers: N O N E
• Keywords: Period of limitation; Set aside
• Section: 254(2); 13; 22; 11

Judgement Text

MA NO 32 OF 2020 BODEPUDI NAGESWARA RAO KHAMMAM PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD (THROUGH VIDEO CONFERENCING) BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER MA NO.32/HYD/2020 (ARISING OUT OF ITA NO.1557/HYD/2017 ASSESSMENT YEAR: 2009-10 ITO WARD-2 KHAMMAM VS. SHRI BODEPUDI NAGESWARA RAO, KHAMMAM PAN:ABFPB6779H (APPELLANT) (RESPONDENT) REVENUE BY: SRI V.V.S.T. SAI, CIT (DR) ASSESSEE BY: N O N E DATE OF HEARING: 05/02/2021 DATE OF PRONOUNCEMENT: 22/02/2021 ORDER PER SMT. P. MADHAVI DEVI, J.M. THIS M.A. IS FILED BY THE REVENUE SEEKING RECALL OF THE ORDER OF THE TRIBUNAL ORDER, DATED 26.8.2019 DISMIS SING THE APPEAL OF THE REVENUE ON THE GROUND OF LOW TAX EFFE CT. HOWEVER, IT IS SEEN THAT THIS M.A. FILED U/S 254(2) OF THE ACT IS BEYOND THE TIME LIMIT OF SIX MONTHS FROM THE DATE OF THE ORDER AND THE REVENUE HAS FILED AN APPLICATION FOR CONDONATION OF DELAY. IN THE M.A NOS.33/HYD/2020 IN SIMILAR CIRCUMSTANCES, THIS TRIBUNAL HAS HELD AS UNDER: 2. THE CAPTIONED MISCELLANEOUS APPLICATION WAS FI LED ON 24/07/2020, WHICH IS CLEARLY BEYOND THE DUE DATE AS PRESCRIBED U/S 254(2) OF THE ACT. THE REGISTRY HAS POINTED OUT THE ABOVE DEFECT MENTIONING THAT THIS MA IS FILED BEYOND THE TIME LI MIT PRESCRIBED U/S 254(2) OF THE I.T. ACT, 1961 AND THEREFORE, THE MA IS NOT MAINTAINABLE. LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE REVENUE WOULD LIKE TO GET THE INSTRUCTIONS FROM THE A.O FOR FILING OF A PETITION FOR MA NO 32 OF 2020 BODEPUDI NAGESWARA RAO KHAMMAM PAGE 2 OF 4 CONDONATION OF DELAY. HOWEVER, IN THE CASE OF GAYA TRI INFRA VENTURES LTD IN M.A. NO.55/HYD/2018, THE COORDINATE BENCH OF THE TRIBUNAL HAS HELD THAT THE DELAY IN FILING THE MISCELLANEOUS APPLICATION CANNOT BE CONDONED. THE RELEVANT PARAS OF THE TRIBUNAL OR DER ARE EXTRACTED HEREIN BELOW FOR REFERENCE:- 5. WE FIND THAT W.E.F 1.6.2016, THE STATUTE HAS PR OVIDED ONLY A PERIOD OF SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER WAS PASSED FOR FILING OF M.A. U/S 254(2) OF THE ACT AND THE TRIBUNAL DOES NO T HAVE THE POWER TO CONDONE DELAY IN FILING OF THE M.A BEYOND THE SAID PERIOD. THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF BHARAT PETROLEUM CORPN. L TD VS. ITAT (2013) 359 ITR 371, WHILE DEALING WITH AN IDENTICAL ISSUE I.E. PER IOD OF 4 YEARS FOR FILING OF THE APPLICATION U/S 254(2) AS WAS AVAILABLE PRIOR TO TH E AMENDMENT, HAS HELD AS UNDER: 16) IT WAS NEXT CONTENDED ON BEHALF OF THE PETITIO NER THAT THE POWER OF THE TRIBUNAL UNDER SECTION 254(2) OF THE ACT IS ONLY TO RECTIFY AN ERROR APPARENT FROM THE RECORD. IT DOES NOT EMPOWER THE TRIBUNAL T O RECALL ITS EARLIER ORDER DATED 6 DECEMBER 2007 FOR WHICH THE MISCELLANEOUS A PPLICATION WAS FILED ON 6 AUGUST 2012. IT WAS SUBMITTED ON BEHALF OF THE PETI TIONER THAT THE APPLICATION UNDER SECTION 254(1) OF THE ACT WOULD BE THE ONLY P ROVISION UNDER WHICH AN APPLICATION COULD BE MADE FOR RECALL OF AN ORDER, A S UNDER SECTION 254(2) OF THE ACT ONLY THE ORDER CAN BE RECTIFIED BUT CANNOT BE R ECALLED. WE FIND THAT THERE IS AN ERROR APPARENT ON RECORD AND THE MISCELLANEOUS A PPLICATION IS TO CORRECT THE ERROR APPARENT FROM THE RECORD. THE CONSEQUENCE OF SUCH RECTIFICATION APPLICATION BEING ALLOWED MAY LEAD TO A FRESH HEARI NG IN THE MATTER AFTER HAVING RECALLED THE ORIGINAL ORDER. HOWEVER, THE RECALL, I F ANY, IS ONLY AS A CONSEQUENCE OF RECTIFYING THE ORIGINAL ORDER. IT IS PERTINENT T O NOTE THAT SECTION 254(2) OF THE ACT DOES NOT PROHIBIT THE RECALL OF AN ORDER. IN FA CT THE POWER/JURISDICTION OF THE TRIBUNAL TO RECALL AN ORDER ON RECTIFICATION APPLIC ATION MADE UNDER SECTION 254(2) OF THE ACT IS NO LONGER RESINTEGRA. THE ISSU E STANDS COVERED BY THE DECISION OF THE APEX COURT IN ASSISTANT COMMISSIONE R OF INCOME TAX VS. SAURTASHTRA KUTCH STOCK EXCHANGE LIMITED (2008) 305 ITR 227 WHICH HELD THAT THOUGH THE TRIBUNAL HAS NO POWER TO REVIEW ITS OWN ORDER, YET IT HAS JURISDICTION TO RECTIFY ANY MISTAKE APPARENT ON THE FACE OF THE RECORD AND AS A CONSEQUENCE THEREFORE, TRIBUNAL CAN EVEN RECALL ITS ORDER. IN THE ABOVE CASE BEFORE THE APEX COURT ON 27 OCTOBER 2000 THE TRIBUN AL DISMISSED THE APPEAL OF STOCK EXCHANGE HOLDING THAT IT WAS NOT ENTITLED TO EXEMPTION UNDER SECTION 11 READ WITH SECTION12 OF THE ACT. ON 13 NOVEMBER 2000 THE STOCK EXCHANGE FILED A RECTIFICATION APPLICATION UNDER SECTION 254(2) OF THE ACT BEFORE THE TRIBUNAL. THE TRIBUNAL BY ITS ORDER DATED 5 SEPTEMBER 2001 AL LOWED THE APPLICATION AND HELD THAT THERE WAS MISTAKE APPARENT ON THE RECORD WHICH REQUIRED RECTIFICATION. ACCORDINGLY, THE TRIBUNAL RECALLED I TS ORDER DATED 27 OCTOBER 2000 FOR THE PURPOSE OF ENTERTAINING THE APPEAL AFRESH. THE REVENUE FILED A WRIT PETITION IN THE GUJARAT HIGH COURT CHALLENGING THE ORDER DATED 5 SEPTEMBER 2001. THE ABOVE CHALLENGE BY THE REVENUE WAS TURNED DOWN BY THE GUJARAT HIGH COURT. THE REVENUE CARRIED THE MATTER IN APPEA L TO THE APEX COURT WHICH ALSO DISMISSED THE APPEAL OF THE REVENUE. THE APEX COURT OBSERVED THAT THE TRIBUNAL IN ITS ORIGINAL ORDER WHILE DISMISSING THE STOCK EXCHANGE (ASSESSEE'S) APPEAL OVERLOOKED BINDING DECISIONS OF THE JURISDIC TIONAL HIGH COURT. THIS MISTAKE WAS CORRECTED BY THE TRIBUNAL UNDER SECTION 254(2) OF THE ACT. THE SUPREME COURT HELD THAT THE RECTIFICATION OF AN ORD ER STANDS ON THE FUNDAMENTAL PRINCIPLE THAT JUSTICE IS ABOVE ALL AND UPHELD THE EXERCISE OF POWER UNDER SECTION 254(2) OF THE ACT BY THE TRIBUNAL IN RECALLING ITS EARLIER ORDER DATED 27 OCTOBER 2000. THUS RECALL OF AN ORDER IS N OT BARRED ON RECTIFICATION APPLICATION BEING MADE BY ONE OF THE PARTIES. IN TH ESE CIRCUMSTANCES, THE APPLICATION WOULD BE AN APPLICATION FOR RECTIFICATI ON OF THE ORDER DATED 6 DECEMBER 2007 AND WOULD STAND GOVERNED BY SECTION 2 54(2) OF THE ACT. MA NO 32 OF 2020 BODEPUDI NAGESWARA RAO KHAMMAM PAGE 3 OF 4 17) IN THE FACTS OF THE PRESENT CASE THERE CAN BE N O DENIAL THAT THE ORDER DATED 6 DECEMBER 2007 SUFFERS FROM AN ERROR APPARENT FROM THE RECORD. THE ERROR IS IN HAVING IGNORED THE MANDATE OF RULE 24 OF THE TRI BUNAL RULES WHICH REQUIRED THE TRIBUNAL TO DISPOSE OF THE MATTER ON MERITS AFT ER HEARING THE RESPONDENTS. IN THESE CIRCUMSTANCES, AN APPLICATION FOR RECTIFIC ATION WOULD LIE UNDER SECTION 254(2) OF THE ACT. THE RECALL OF AN ORDER WOULD WEL L BE A CONSEQUENCE OF RECTIFYING AN ORDER UNDER SECTION 254(2) OF THE ACT . IN THESE CIRCUMSTANCES, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF THE T RIBUNAL HOLDING THAT MISCELLANEOUS APPLICATION FILED BY THE APPELLANT IS BARRED BY LIMITATION UNDER SECTION 254(2) OF THE ACT AS IT WAS FILED BEYOND A PERIOD OF FOUR YEARS FROM THE ORDER SOUGHT TO BE RECTIFIED. 18) BEFORE CONCLUDING, WE WOULD LIKE TO MAKE IT CLE AR THAT AN ORDER PASSED IN REACH OF RULE 24 OF THE TRIBUNAL RULES, IS AN IRREG ULAR ORDER AND NOT A VOID ORDER. HOWEVER, EVEN IF IT IS ASSUMED THAT THE ORDE R IN BREACH OF RULE 24 OF THE TRIBUNAL RULES IS AN VOID ORDER, YET THE SAME WOULD CONTINUE TO BE BINDING TILL IT IS SET ASIDE BY A COMPETENT TRIBUNAL. IN FACT, T HE APEX COURT IN THE SULTAN SADIK V/S. SANJAY RAJ SUBBA REPORTED IN 2004(2) SCC 277 HAS OBSERVED AS UNDER: ' PATENT AND LATENT INVALIDITY IN A WELL KNO WN PASSAGE LORD RADCLIFFE SAID : ' AN ORDER, EVEN IF NOT MADE IN GOOD FAITH, IS STILL AN ACT CAPABLE OF LEGAL CONSEQUENCES. IT BEARS NO BRAND OF INVALIDITY UPON ITS FOREHEAD. UNLESS THE NECESSARY PROCEEDINGS ARE TAKEN AT LAW TO ESTABLISH THE CAUSE OF INVALIDITY AND TO GET IT QUASHED OR OTHERWISE UPSET, IT WILL REMAI N AS EFFECTIVE FOR ITS OSTENSIBLE PURPOSE AS THE MOST IMPECCABLE OF ORDERS.' THIS MUS T BE EQUALLY TRUE EVEN WHERE THE BRAND OF INVALIDITY IS PLAINLY VISIBLE, F OR THERE ALSO THE ORDER CAN EFFECTIVELY BE RESISTED IN LAW ONLY BY OBTAINING A DECISION OF COURT.' 3. FURTHER, THE SUPREME COURT IN SNEH GUPTA V/S. DE V SARUP (2009) 6 SCC 194 HAS OBSERVED AS UNDER: 'WE ARE CONCERNED HEREIN WITH THE QUESTION OF LIMIT ATION. THE COMPROMISE DECREE, AS INDICATED HEREIN BEFORE, EVEN IF VOID WA S REQUIRED TO BE SET ASIDE. A CONSENT DECREE AS IS WELL KNOWN, IS AS GOOD AS A CO NTESTED DECREE. SUCH A DECREE MUST BE SET ASIDE IF IT HAS BEEN PASSED IN V IOLATION OF LAW. FOR THE SAID PURPOSE, THE PROVISIONS CONTAINED IN LIMITATION ACT 1963 WOULD BE APPLICABLE. IT IS NOT THE LAW THAT WHERE THE DECREE IS VOID, NO PERIOD OF LIMITATION SHALL BE ATTRACTED AT ALL.' THEREFORE, IN THIS CASE ALSO THE PERIOD OF FOUR YEA RS FROM THE DATE OF ORDER SOUGHT TO BE RECTIFIED/RECALLED WILL APPLY AS PROVI DED IN SECTION 254(2) OF THE ACT. THIS IS SO EVEN IF IT IS ASSUMED THAT THE ORDE R DATED 6 DECEMBER 2006 IS A VOID ORDER. 19) WE SHALL NOW ANSWER THE QUESTIONS ARISING IN TH IS CASE AS RAISED BY US IN PARAGRAPH 4 ABOVE AS UNDER: QUESTION(A): NO. THE TRIBUNAL HAS NO POWER IN TERMS OF RULE 24 OF THE TRIBUNAL RULES TO DISMISS AN APPEAL BEFORE IT FOR NON PROSEC UTION. QUESTION(B): THE MISCELLANEOUS APPLICATION FOR RECALL OF AN ORDER FA LLS UNDER SECTION 254(2) OF THE ACT AND NOT UNDER SECTION 254(1) OF THE ACT. QUESTI ON(C): DOES NOT ARISE IN VIEW OF OUR RESPONSE TO QUERY (B) ABOVE. 20) IN VIEW OF THE REASONS GIVEN HEREIN ABOVE, WE F IND THE TRIBUNAL WAS CORRECT IN DISMISSING THE MISCELLANEOUS APPLICATION BY ITS ORDER DATED 10 APRIL 2013 AS BEING BEYOND THE PERIOD OF FOUR YEARS AS PROVIDED U NDER SECTION 254(2) OF THE ACT. 21) ACCORDINGLY, THE PETITION IS DISMISSED WITH NO ORDER AS TO COSTS. MA NO 32 OF 2020 BODEPUDI NAGESWARA RAO KHAMMAM PAGE 4 OF 4 4. RESPECTFULLY, FOLLOWING THE DECISIONS OF THE HIG HER JUDICIARY AS WELL AS THE DECISION OF THE COORDINATE BENCH CIT ED SUPRA, THE MA FILED BY THE REVENUE IS DISMISSED AS NON-MAINTAINAB LE . 2. FURTHER, THE APPLICANT PLEADS THE COVID-19 LOCKD OWN AS A REASON FOR THE DELAY. HOWEVER, WE FIND THAT TH E DUE DATE FOR FILING OF THE M.A. WAS 1.3.2020 WHEREAS THE NATIONA L LOCKDOWN WAS FROM 24.3.2020. THEREFORE, THE SAID GROUND DOES NOT HOLD GOOD. SINCE THE TRIBUNAL DOES NOT HAVE THE POWER TO CONDONE THE DELAY AND THIS M.A IS BARRED BY PERIOD OF LIMITATIO N, THIS M.A. IS DISMISSED. 3. IN THE RESULT, M.A. FILED BY THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND FEBRUARY, 2021. SD/- S D/- (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 22 ND FEBRUARY, 2021. VINODAN/SPS COPY TO: 1 ITO WARD-2, 2 ND FLOOR, AAYAKAR BHAVAN, KHAMMAM 2 SRI BODEPUDI NAGESWARA RAO, 6-2-2-/1, SAI KRISHNA NAGAR, KHAMMAM 3 CIT (A)-7 HYDERABAD 4 PR. CIT 7 HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER