THE COMMISSIONER OF INCOME TAX vs. SRI.B.MOHANACHANDRAN NAIR
What did the High Court hold?
The High Court declined to entertain the appeal. The Court noted that the ITAT had merely followed the dicta laid down by the jurisdictional High Court. The Court observed that if the Revenue believed the ITAT's reasoning and conclusion were contrary to the law laid down by the apex Court in the IPCA Laboratory's case, the appropriate recourse would be to make an application before the ITAT itself, either for review or rectification of its order. The Court granted liberty to the Revenue to pursue such an application before the ITAT. The appeal was disposed of on this procedural ground, without deciding the merits of the case.
What were the facts?
The Revenue, Commissioner of Income Tax, Thiruvananthapuram, filed an appeal before the High Court of Kerala against an order dated May 11, 2005, passed by the Income Tax Appellate Tribunal (ITAT), Cochin Bench, in ITA No. 439/Coch/2002, pertaining to the assessment year 1996-97. The appeal was filed for admission after a delay of over three years, attributed to the non-payment of court fees by the Revenue. The Revenue's counsel brought to the court's attention a Supreme Court decision in IPCA Laboratory Ltd. v. Deputy Commissioner of Income Tax [(2004) 266 ITR 521] which they believed contradicted the ITAT's reasoning.
What were the issues?
1. Whether the High Court should entertain the Revenue's appeal against the ITAT's order when the ITAT had followed the jurisdictional High Court's dicta, and the Revenue now claims this dicta is contrary to the Supreme Court's decision in IPCA Laboratory Ltd. v. Deputy Commissioner of Income Tax [(2004) 266 ITR 521]? (Question of law and fact) Assessee's Contentions: Not recorded. Revenue's Contentions: The Revenue contended that the ITAT's order, which followed the High Court's earlier view, was not sustained by the Supreme Court's decision in IPCA Laboratory Ltd. v. Deputy Commissioner of Income Tax [(2004) 266 ITR 521]. Therefore, the Revenue sought to challenge the ITAT's order before the High Court.
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Cause title — parties, addresses and appearances
JUDGMENT H.L.Dattu, C.J. The Revenue is before us in this appeal, being aggrieved by the orders passed by the Income Tax Appellate Tribunal, Cochin Bench, in I.T.A.No.439 of 2002, for the assessment year 1996-97. The order passed by the Tribunal is dated 11th May, 2005. 2. The Tribunal while deciding the issues raised by the Revenue before it, had answered those issues following the dicta laid down by the juri ictional High Court.
For the first time, after more than three years, the matter is coming up for admission before us. This was only because of the non- payment of the court fee by the Revenue. If for any reason, the appeal had come before us immediately after it was filed before this Court, our answer would have been to accept the reasoning of the Tribunal for the reason that the Tribunal had merely followed the dicta laid down by this Court.
Now it is brought to our notice by the learned counsel appearing for the Department that the view expressed by this Court is not sustained by the apex Court in the decision rendered in the case of I.T.A.No.87 of 2008 2 IPCA Laboratory Ltd. v. Deputy Commissioner of Income Tax [(2004) 266 ITR 521]. In our opinion, if for any reason the Department is of the opinion that the reasoning and conclusion reached by the Tribunal is contrary to the law laid down by the apex Court in the case of IPCA Laboratory's case, the Revenue has to make an appropriate application before the Tribunal, either for review or rectification of its order.
In that view of the matter, we decline to entertain this appeal. Accordingly, the appeal is disposed of. However, we grant liberty to the Revenue to make an appropriate application/review petition before the Tribunal for appropriate orders. Ordered accordingly.
(H.L.DATTU) CHIEF JUSTICE
(A.K.BASHEER) JUDGE vns
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