GHARDA CHEMICALS LTD, V. DCIT 9(1),

MA 660/MUM/2010

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 6047 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 21-01-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: L
• Assessment Year: 2002-2003
• Appeal Filed On: 09-11-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: D SONGATE
• Assessee Lawyers: P J PARDIWALA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH L,MUMBAI BEFORE SHRI R.S. SYAL (AM) & SHRI R.S. PADVEKAR (JM ) M.A.NO.660/MUM/2010 (ARISING OUT OF I.T.A.NO.2242/MUM/06) (A.Y. 2002-03) M/S. GHARDA CHEMICALS LTD., GHARDA HOUSE, 48, HILL ROAD, BANDRA (W), MUMBAI-400 050. VS. DY.COMMR. OF INCOME-TAX-9(1), MUMBAI. APPLICANT RESPONDENT APPLICANT BY SHRI P.J. PARDIWALA. RESPONDENT BY SHRI D . SONGATE. O R D E R PER R.S. SYAL, AM: THIS MISC. APPLICATION HAS BEEN FILED BY THE ASSES SEE AGAINST THE CAPTIONED TRIBUNAL ORDER DATED 30-11-2009 FOR THE A.Y. 2002-0 3. THE LD. A.R. CONTENDED THAT THE ASSESSEE RAISED AN ADDITIONAL GROUND READI NG AS UNDER, WHICH WAS INADVERTENTLY OMITTED TO BE DISPOSED OF BY THE BENC H: THE APPELLANT SUBMITS THAT THE LEARNED COMMISSIONE R (APPEALS) OUGHT TO HAVE ALLOWED AN ADDITIONAL DEDUCTION UNDER SECTION 35(2AB) OF RS.3,29,90,702, BEING 50% OF THE TOTAL I N-HOUSE RESEARCH AND DEVELOPMENT EXPENDITURE OF RS.7,85,81, 403 INCURRED BY THE APPELLANT DURING THE PREVIOUS YEAR. 2. COUNTERING THESE SUBMISSIONS, THE LD. DR S TATED THAT, DURING THE COURSE OF HEARING OF THE APPEAL, NO SUCH ISSUE WAS ARGUED ON BEHALF OF THE ASSESSEE AND HENCE IT COULD NOT BE CONSTRUED AS A MISTAKE APPARE NT FROM RECORD. 3. HAVING HEARD BOTH THE SIDES AND PERUSED THE RELE VANT MATERIAL ON RECORD, IT IS NOTED THAT THE ASSESSEES MEMORANDUM OF APPEA L CONTAINS 11 GROUNDS, MA NO.660/M/10 2 WHICH HAVE BEEN ADJUDICATED BY THE TRIBUNAL IN THE IMPUGNED ORDER. THE ASSESSEES PRESENT MISCELLANEOUS APPLICATION IS ON THE ALLEGED NON-DISPOSAL OF AN ADDITIONAL GROUND. WE HAVE CHECKED UP OUR LOG BOO K FOR 26.11.2009, BEING THE DATE ON WHICH THE SAID APPEAL WAS TAKEN UP FOR HEAR ING. IT IS FOUND THAT THERE IS NO RECORDING OF ANY ARGUMENT ADVANCED ON BEHALF OF THE ASSESSEE ON THIS ADDITIONAL GROUND. IN THE LIKE MANNER, THERE IS NO RECORDING OF ANY REPLY GIVEN BY THE LD. DR ON THIS ISSUE. IN VIEW OF THESE FACTS, IT BECOMES APPARENT THAT THIS GROUND WAS NOT AT ALL ARGUED BY THE ASSESSEE. 4. IT IS AUSTERE THAT ANY GROUND SET OUT IN TH E MEMORANDUM OF APPEAL HAS TO BE NECESSARILY DISPOSED OF BY THE APPELLATE AUTHORI TY, BEFORE WHOM THE APPEAL IS FILED. WHERE THE APPELLANT SUCCEEDS IN CONVINCING T HE APPELLATE AUTHORITY THAT THE IMPUGNED ORDER IS NOT CORRECT ON ANY ISSUE, THE ORD ER IS MODIFIED AND THE RELEVANT GROUND IS ALLOWED. IF, HOWEVER, THE PLAINT IFF FAILS TO SATISFY THE CONCERNED APPELLATE AUTHORITY ABOUT THE INCORRECTNESS OF THE ORDER APPEALED AGAINST ON A PARTICULAR ISSUE, THE GROUND CONTESTING THAT ISSUE, IS DISMISSED. THERE MAY BE A SITUATION IN WHICH THE APPELLANT RAISES A GROUND AS SAILING THE ORDER, BUT LATER ON GETS CONVINCED AND DOES NOT PRESS THE SAME BEFORE T HE APPELLATE AUTHORITY. SUCH A GROUND IS DISMISSED AS NOT PRESSED. THERE MAY BE STILL ANOTHER SITUATION IN WHICH A GROUND IS RAISED BUT DURING THE COURSE OF H EARING, NO SUBMISSION IS MADE IN SUPPORT OF THAT GROUND. SUCH GROUND ALSO MEETS WITH THE FATE OF DISMISSAL. THE DIFFERENCE BETWEEN THE AFORESAID TWO SITUATIONS IS CLEAR. WHEREAS IN THE FIRST, THE APPELLANT DOES NOT EXPRESSLY PRESS ITS GROUND, BUT IN THE SECOND, WHEN NO SUBMISSION IS MADE, IT IS IMPLIEDLY TAKEN AS NOT PR ESSED. IT IS MANIFEST THAT THE ONUS OF PROVING THE IMPUGNED ORDER AS WRONG TO THE EXTENT APPEALED AGAINST, IS ALWAYS ON THE APPELLANT. IF IT IS NOT PROVED AS WRO NG, EITHER EXPRESSLY OR IMPLIEDLY, THE ORDER IS NOT DISTURBED. FROM HERE IT FOLLOWS THAT EACH AND EVERY MA NO.660/M/10 3 GROUND RAISED BY THE APPELLANT, IN ITS APPEAL MEMO, HAS TO BE MANDATORILY DEALT WITH IN THE ORDER. NOT DISPOSING OF A GROUND IN THE ORDER, CONSTITUTES A MISTAKE APPARENT FROM RECORD. THE APPELLANT IS ALWAYS ENTIT LED TO APPLY FOR RECTIFICATION OF SUCH ORDER, IN WHICH CASE THE APPELLATE AUTHORITY S HALL BE DUTY BOUND TO RECTIFY ITS ORDER. THIS LEGAL POSITION IS FULLY APPLICABLE TO T HE INCOME-TAX APPELLATE TRIBUNAL AS WELL. 5. HOWEVER IT IS PARAMOUNT TO NOTE THAT, THE PO SITION DISCUSSED IN THE FOREGOING PARA IS QUA THE GROUNDS, WHICH ARE TAKEN UP IN THE MEMORANDUM OF APPEAL IN FORM NO. 36. IT IS POSSIBLE THAT THE APP ELLANT MAY REALIZE LATER ON THAT, APART FROM THE GROUNDS TAKEN IN THE MEMO OF APPEAL, SOME OTHER GROUND WAS/IS ALSO REQUIRED TO BE RAISED. SUCH A POSITION MAY PRE VAIL IN VARIETY OF SITUATIONS, SUCH AS, THE EARLIER OMISSION OR SOME SUBSEQUENT L EGAL ADVICE OR CERTAIN LATER DEVELOPMENT OF LAW. IN THESE SITUATIONS THE APPELL ANT IS ENTITLED TO APPLY FOR THE ADMISSION OF AN ADDITIONAL GROUND DURING THE PENDEN CY OF APPEAL BEFORE THE TRIBUNAL. RELEVANT PART OF RULE 11 OF APPELLATE TR IBUNAL RULES, 1963 PROVIDES THAT :`THE APPELLANT SHALL NOT, EXCEPT BY THE LEAVE OF THE TRIBUNAL, URGE OR BE HEARD IN SUPPORT OF ANY GROUND NOT SET FORTH IN THE MEMORANDUM OF APPEAL,...... ON GOING THROUGH THE PRESCRIPTION OF THIS RULE IT IS MANDATED THAT THE RIGHT OF THE APPELLANT TO BE HEARD IS CONFINED TO THE GROUNDS TA KEN UP IN THE MEMORANDUM OF APPEAL. THERE IS NO VESTED RIGHT TO THE APPELLANT T O ARGUE ON ANY GROUND, NOT RAISED IN THE MEMO OF APPEAL. IF THE PARTY IN APPEA L WANTS TO TAKE UP ANY GROUND, OTHER THAN THOSE NOT MENTIONED IN THE APPE AL MEMO, IT NEEDS TO SEEK THE LEAVE OF THE TRIBUNAL. IT, THEREFORE, TRANSPIRE S THAT BEFORE ANY ADDITIONAL GROUND QUALIFIES TO BE DEALT WITH AT PAR WITH THOSE TAKEN IN MEMO OF APPEAL, IT HAS TO NECESSARILY CROSS THE HURDLE OF ITS ADMISSIO N. THUS IT BECOMES VIVID THAT THE ADDITIONAL GROUND RAISED BY THE APPELLANT IS FI RSTLY TAKEN UP FOR ADMISSION. MA NO.660/M/10 4 THE APPELLANT HAS TO DEMONSTRATE THE REASONS FOR WH ICH IT COULD NOT BE TAKEN UP EARLIER. IF THE ADDITIONAL GROUND SATISFIES THE T ESTS LAID DOWN BY THE HONBLE COURTS, SUCH AS, THE GROUND INVOLVING ONLY A QUESTI ON OF LAW OR ANY OTHER QUESTION NOT REQUIRING INVESTIGATION OF FRESH FACTS ETC, THEN SUCH GROUND IS ADMITTED AFTER CONSIDERING THE OBJECTIONS OF THE RE SPONDENT. ONLY WHEN SUCH AN ADDITIONAL GROUND IS ADMITTED, IT COMES ON THE SAME PLATFORM AS THE GROUNDS TAKEN UP IN THE MEMO OF APPEAL, REQUIRING DISPOSAL BY THE TRIBUNAL AND ITS NON- DISPOSAL CONSTITUTING AN ERROR APPARENT FROM RECORD . IF, HOWEVER, SUCH AN ADDITIONAL GROUND IS NOT ADMITTED BY THE TRIBUNAL, THE RIGHT OF THE APPELLANT TO ITS ADJUDICATION IS LOST. IN SUCH A SITUATION, THERE CA NNOT BE ANY QUESTION OF ITS PARITY WITH THE GROUNDS TAKEN IN THE MEMO OF APPEAL. THE N ATURAL CONSEQUENCE OF THE NON-ADMISSION OF AN ADDITIONAL GROUND, EITHER AFTER HEARING BOTH THE SIDES OR IN THE ABSENCE OF ANY ARGUMENT PUT UP BY THE APPELLANT IN SUPPORT OF ITS ADMISSION, IS THAT THERE IS NO OBLIGATION ON THE TRIBUNAL TO T AKE IT UP FOR DISPOSAL ON MERITS. IF THE TRIBUNAL STRAIGHTWAY PROCEEDS TO DISPOSE OF AN ADDITIONAL GROUND WITHOUT CROSSING THE IMPEDIMENT OF ITS ADMISSION, THE ORDER WILL BECOME ERRONEOUS TO THAT EXTENT, GIVING EVERY RIGHT TO THE RESPONDENT T O APPLY FOR RECTIFICATION. 6. ADVERTING TO THE FACTS OF THE INSTANT CA SE IT IS NOTICED THAT THERE IS NO RECORDING IN ORDER SHEET ENTRY ADMITTING THE ABOVE EXTRACTED ADDITIONAL GROUND. APART FROM NO ARGUMENT RECORDED IN OUR LOG BOOK FR OM BOTH THE SIDES ON THE MERITS OF THE THIS GROUND, THERE IS NOT EVEN ANY ME NTION OF THE PRAYER FOR THE ADMISSION OF ADDITIONAL GROUND OR THE OBJECTIONS OF THE LD. DR TO ITS ADMISSION. IN THE BACKDROP OF SUCH FACTS, THE PICTURE IS CLEAR TH AT THE SO CALLED ADDITIONAL GROUND, WAS NEVER ARGUED FOR ITS ADMISSION. IN THE ABSENCE OF ITS ADMISSION, THERE IS NO SCOPE FOR CONTENDING THAT THERE IS A MI STAKE, MUCH LESS THE MISTAKE MA NO.660/M/10 5 APPARENT FROM RECORD, IN NOT ADJUDICATING THE SAME IN THE ORDER OF THE TRIBUNAL, WARRANTING ANY RECTIFICATION U/S.254(2) OF THE ACT. 7. IN THE RESULT, THE MISC. APPLICATION IS DISMISSE D. ORDER PRONOUNCED ON THE 21ST DAY OF JANUARY, 2011. SD/- SD/- (R.S. PADVEKAR) (R.S. SYAL) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI: 21ST JANUARY , 2011. NG: COPY TO : 1. APPLICANT 2. DEPARTMENT. 3 CIT(A)-IX,MUMBAI. 4 CIT-IX,MUMBAI. 5.DR,L BENCH,MUMBAI. 6.MASTER FILE. (TRUE COPY) BY ORDER, ASST.REGISTRAR, ITAT, MUMBAI. MA NO.660/M/10 6 DETAILS DATE INITIALS DESIGNATI ON 1. DRAFT DICTATED ON 14-01-2011 SR.PS/ 2. DRAFT PLACED BEFORE AUTHOR 17-01-2011 SR.PS/ 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/ 6. KEPT FOR PRONOUNCEMENT ON SR.PS/ 7. FILE SENT TO THE BENCH CLERK SR.PS/ 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9. DATE ON WHICH FILE GOES TO THE AR 10. DATE OF DISPATCH OF ORDER