Smt. Akula Suvarna, Nizamabad V. ACIT, Hyderabad

MA 56/HYD/2010

• Counselvise Citation: [2010] 123 COUNSELVISE.COM (IT) 4926 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 21 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-08-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 06-04-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: VASUNDHARA SINHA
• Assessee Lawyers: AJAY GANDHI
• Keywords: Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B , HYDERABAD BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER MA.NO.56/HYD/2010 IN IT(SS)A NO.85 /HYD/2003 ASSESSMENT YEARS 1988-99 TO 1999-2000 SMT. AKULA SUVARNA, NIZAMABAD VS. ACIT, HYDERABAD (PAN ABQPA5937 M) MA.NO.57/HYD/2010 IN IT(SS)A NO.86 /HYD/2003 ASSESSMENT YEARS 1988-99 TO 1999-2000 SMT. AKULA VENKATI), NIZAMABAD VS. ACIT, HYDERABAD (PAN ABQPA 4743 M) APPELLANT BY : SHRI AJAY GANDHI RESPONDENT BY : SMT. VASUNDHARA SINHA, DR O R D E R PER: CHANDRA POOJARI, ACCOUNTANT MEMBER BY THESE TWO MISCELLANEOUS PETITIONS THE ASSESSEE SEEKS RECALL OF THE ORDER OF THIS TRIBUNAL IN IT(SS)A NOS.85 /HYD/2003 & IT(SS)A.86/HYD/2003 DATED 29.1.2010 FOR THE ASSESSMENT Y EARS 1988- 99 TO 1999-2000 . 2. THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED TH AT THE DEPARTMENT HAD NEVER SERVED THE ORDER NOTIFYING THE TRANSFER OF THEIR CASES. AT THE TIME OF HEARING OF APPEALS BEFORE THIS TR IBUNAL, ON SUCH AN AFFIRMATION MADE BY THE ASSESSEES, THE HONBLE TRIBUN AL INSTRUCTED THE DEPARTMENTAL REPRESENTATIVE TO PRODUCE EVIDENCE OF SERVICE OF THE SAID ORDER. AFTER SEVERAL ADJOURNMENTS AT THE REQUEST OF THE DEPARTMENT MA NOS.56&57/HYD/2010 (IN IT(SS)A NOS.85 & 86/HYD/2010 SMT. AKULA SUVARNA & VENKATI SUVARNA, NIZAMABAD. 2 SEEKING TIME TO PRODUCE THE SAID EVIDENCE THE DEPARTME NTAL REPRESENTATIVE AFFIRMED THAT THE DEPARTMENT WAS UNAB LE TO PRODUCE THE ACKNOWLEDGEMENT OF SERVICE OF THE SAID ORDER. IT WAS FU RTHER SUBMITTED THAT THIS WAS ENOUGH EVIDENCE OF ASSESSEES CLAIM THAT THE SA ID ORDER WAS NEVER SERVED ON THE ASSESSEES. IN VIEW OF THIS FACTUAL POSITION, HE SUBMITTED THAT SERVICE OF AN ORDER WAS AN ABSOLUTE ESSENT IAL FOR IT TO TAKE EFFECT. SINCE THE SAID ORDER WAS NOT SERVED, THE N ATURAL AND ONLY CONSEQUENCE WAS THAT THE ORDER DID NOT BECOME EFFECTIVE. THIS RESULTED IN THE JURISDICTION NOT GETTING TRANSFERRED TO HYDERABA D. HE PLEADED THAT THIS SOLE FACT WOULD RENDER THE ASSESSMENT VOID AB I NITIO DESERVING TO BE ANNULLED. HE FURTHER SUBMITTED THAT AN ORDER O F ANNULMENT ON THE GROUNDS OF NON SERVICE WAS NOT THE SAME AS EXAMINING THE VALIDATE OF THE ORDER ITSELF. AS SUCH, EVEN IF THE HONBLE TRIBUNA L TOOK THE POSITION THAT IT DID NOT HAVE THE POWERS TO EXAMINE THE VALID ITY OF THE ASSESSMENT OTHERWISE, IT WAS ENTITLED TO; EVEN OBLIGED TO , ANNUL THE ASSESSMENT SINCE THE TRANSFER OF JURISDICTION NEVER BECAME E FFECTIVE. 4. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REP RESENTATIVE SUBMITTED THAT THE TRIBUNAL HAS FAIRLY CONSIDERED THE A RGUMENT OF THE ASSESSEES COUNSEL WHICH WAS RECORDED IN PARA 5 AT PAGE 5 OF ITS TRIBUNAL WHICH READS AS FOLLOWS: THAT THE ORDER U/S 127 WAS NEVER SERVED ON THE ASS ESSEE, AND AS SUCH IT WAS NOT POSSIBLE FOR THE ASSESSEE TO FILE A WRIT PETITION IN THE ABSENCE OF AN ORDER, WHICH WAS OFFERED FOR THE FIRST TIME O NLY DURING THE APPELLATE PROCEEDINGS BEFORE THE TRIBUNAL. HER SUB MITTED THAT IT IS A FACT THAT NO ORDER U/S 127 WAS SERVED ON THE ASSESS EE. THIS NON SERVICE OF THE ORDER U/S 127 ON THE ASSESSEE RESULT S IN THAT ORDER NOT COMING INTO EFFECT AND CONSEQUENTLY NOT GIVING JURI SDICTION TO THE OFFICER WHO PASSED THE SAID ORDER. THAT BEING SO, IMPUGNED ASSESSMENTS WOULD BE NULLITY. MA NOS.56&57/HYD/2010 (IN IT(SS)A NOS.85 & 86/HYD/2010 SMT. AKULA SUVARNA & VENKATI SUVARNA, NIZAMABAD. 3 5. FROM THE ABOVE, SHE DREW INFERENCE THAT THE TRIB UNAL HAS APPLIED ITS MIND, TAKEN A CONSCIOUS DECISION ON THE ISSUE WHICH NEED NOT BE INTERFERED BY WAY OF RECALLING THE ORDER THROUGH THIS MISCELLANEOUS PETITIONS. SHE FURTHER SUBMITTED THAT IT IS NOT AN AD MITTED FACT THAT THE ORDER U/S 127 WAS NOT SERVED ON THE ASSESSEES. IT IS ONLY A FACT THAT THE DEPARTMENT IS NOT ABLE TO PRODUCE THE COPY OF THE ORDE R PASSED U/S 127 DUE TO LAPSE OF TIME. FURTHER, SHE SUBMITTED THAT NON -PRODUCING THE COPY OF THE ORDER PASSED U/S 127 OF THE ACT DOES NOT MAKE THE ORDER INEFFECTIVE AND SHE SUBMITTED THAT THE ARGUMENT OF THE ASSESSEES COUNSEL IS BAD IN LAW. THE ARGUMENT OF THE ASSESSEES COUNSE L IS NOTHING BUT HAIR SPLITTING WHICH NEED NOT BE APPRECIAT ED. SERVING OF ORDER IS DIFFERENT FROM PRODUCE A COPY OF IT BEFORE TH E AUTHORITIES. NON PRODUCTION OF THE ORDER DOES NOT INVALIDATE THE VALID ITY OF THE ORDER U/S 127 OF THE ACT. SHE FURTHER SUBMITTED THAT HER ARGUM ENT IS NOT THAT THE ORDER PASSED U/S 127 NEED NOT BE SERVED. ACCORDING TO HER , THERE IS NO NECESSITY TO RECALL THE ORDER OF THIS TRIBUNAL ON ANY RE ASON. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. WHILE DISMISSING THE APPEAL OF TH E ASSESSEE, THE TRIBUNAL HAS TAKEN INTO ACCOUNT ALL RELEVANT MATERIALS . THE FINDINGS OF THE TRIBUNAL ARE NOT LIABLE TO BE INTERFERED WITH U NLESS THE TRIBUNAL HAS TAKEN INTO CONSIDERATION ANY IRRELEVANT MATERIAL OR CO NCLUSION ARRIVED BY THE TRIBUNAL IS NOT BASED ON THE FACTS ON RECORD. IT IS TO BE NOTED THAT THE DECISION OF THE TRIBUNAL HAS NOT TO BE SCRUTINIZED SE NTENCE BY SENTENCE MERELY WHETHER ALL THE FACTS SET OUT IN DETAI L BY THE TRIBUNAL OR SOME INCIDENTAL FACTS WHICH HAS NOT BEEN NOTICED BY THE TRIBUNAL IN ITS ORDER. ON FAIR READING OF THE IMPUGNED ORDER OF TH E TRIBUNAL, IT FINDS THAT IT HAS TAKEN INTO ACCOUNT ALL RELEVANT MATERIAL A ND HAS NOT TAKEN ANY IRRELEVANT MATERIAL IN BASING THE CONCLUSION. TH E DECISION OF THE MA NOS.56&57/HYD/2010 (IN IT(SS)A NOS.85 & 86/HYD/2010 SMT. AKULA SUVARNA & VENKATI SUVARNA, NIZAMABAD. 4 TRIBUNAL IS NOT INTERFERED WITH U/S 254(2) OF THE ACT. IT IS TO BE NOTED THAT THE TRIBUNAL DULY CONSIDERED ALL THE CASE LAW CITE D BY THE ASSESSEES COUNSEL INCLUDING ALL ARGUMENTS WHILE DECIDING THE APPEAL OF THE ASSESSEE WHICH IS NOTED IN THE IMPUGNED ORDER. 7. THE POWER OF RECTIFICATION U/S 254(2) CAN BE EXER CISED ONLY WHEN THE MISTAKE WHICH IS SOUGHT TO BE RECTIFIED AS AN OB VIOUS AND PATENT MISTAKE WHICH IS APPARENT FROM THE RECORD, AND NOT A MISTAKE WHICH REQUIRES TO BE ESTABLISHED BY ARGUMENTS AND A LONG DRAWN PROCESS OF REASONING ON POINTS ON WHICH THERE MAY CONCEIVA BLY BE TWO OPINIONS. FAILURE OF THE TRIBUNAL TO CONSIDER AN ARG UMENT ADVANCED BY EITHER PARTY FOR ARRIVING AT A CONCLUSION IS NOT AN ERR OR APPARENT ON THE RECORD, ALTHOUGH IT MAY BE AN ERROR OF JUDGEMENT. T HE TRIBUNAL CANNOT, IN EXERCISE OF ITS POWER OF RECTIFICATION, LOOK INTO SOME OTHER CIRCUMSTANCES, WHICH WOULD SUPPORT OR NOT SUPPORT ITS CONCLUSI ON. IT IS NOT ALWAYS NECESSARY THAT EVEN IN A SPEAKING ORDER THE TRIBUNAL SHOULD PUT DOWN EVERY ARGUMENT OF THE ASSESSEE IN A DETAILED M ANNER AS HE HAS MADE IT AND THAT TOO IN AN EQUALLY DETAILED MANN ER AS THE ASSESSEE WOULD LIKE TO HAVE IT. WHAT IS IMPORTANT IS WHETHER THE ARGUMENT HAS BEEN HEARD AND GRASPED BY TRIBUNAL AND THE DECISION BE ARS THE STAMP OF SUCH GRASP. 8. FURTHER IT IS TO BE NOTED THAT MERELY BECAUSE THE TRIBUNAL DIFFERS FROM THAT OF THE ASSESSEE, THE TRIBUNALS VIEW CANNOT BE SAID TO BE A MISTAKE IN THE EYES OF LAW OR FACT. IN EFFECT, WHAT THE ASSESSEE WANTS IS A REVIEW OF THE TRIBUNAL ORDER WHICH CANNOT BE BY WAY OF RECTIFICATION OF ITS ORDER. THE SCOPE AND AMBIT OF APPLICATION OF S.254( 2) OF THE IT ACT, 1961, IS VERY LIMITED. THE SAME IS RESTRICTED TO RECTIF ICATION OF MISTAKES APPARENT FROM THE RECORD. RECALLING THE ENTIRE ORDER , WOULD MEAN MA NOS.56&57/HYD/2010 (IN IT(SS)A NOS.85 & 86/HYD/2010 SMT. AKULA SUVARNA & VENKATI SUVARNA, NIZAMABAD. 5 PASSING A FRESH ORDER. THAT DOES NOT APPEAR TO BE THE LEGISLATIVE INTENT. RECALLING THE ORDER AUTOMATICALLY NECESSITATES REHEARING AND RE- ADJUDICATION OF THE ENTIRE SUBJECT MATTER OF APPEAL. THE DISPUTE NO LONG REMAINS RESTRICTED TO ANY MISTAKE SOUGHT TO BE RECTIFIED. POWER TO RECALL AN ORDER IS PRESCRIBED IN TERMS OF REFERENCE 24 OF THE I TAT RULES, 1963, AND THAT TOO ONLY IN CASES WHERE THE ASSESSEE SHOWS THAT IT HAD A REASONABLE CAUSE FOR BEING ABSENT AT A TIME WHEN THE AP PEAL WAS TAKEN UP AND WAS DECIDED EX PARTE. IN THE PRESENT CASE, THE T RIBUNAL TOOK A CONSCIOUS DECISION WHILE DECIDING THE APPEALS OF THE ASSESSEE S. THE PRESENT ARGUMENT OF THE ASSESSEES COUNSEL IS SUPERFICIAL AN D DEVOID OF MERITS. THROUGH THIS MISCELLANEOUS PETITIONS THE ASSESSEES COUNSEL WANTS TO REARGUE HIS CASES WHICH IS NOT PERMITTED U/S 254 (2) OF THE ACT. IN SUBSTANCE, THE DECISION OF THE TRIBUNAL REMAINS UNCHANG ED AND THE SAME IS CONFIRMED. 9. IN THE RESULT, THE MISCELLANEOUS PETITIONS FILED BY THE ASSESSEES ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON : 27.8.2010 SD/- SD/- N.R.S. GANESAN CHANDRA POOJARI JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 27 TH AUGUST, 2010 MA NOS.56&57/HYD/2010 (IN IT(SS)A NOS.85 & 86/HYD/2010 SMT. AKULA SUVARNA & VENKATI SUVARNA, NIZAMABAD. 6 COPY FORWARDED TO: 1. SHRI GANDHI & GANDHI, CA, 1002, PAIGAH PLAZA, BA SHEERBAGH, HYDERABAD-500063. 2. THE ACIT, CIRCLE 7(1), HYDERABAD 3. CIT(A) CAMP GUNTUR, HYDERABAD 4. CIT, HYDERABAD 5. THE D.R., ITAT, HYDERABAD. NP