COMMISSIONER OF INCOME-TAX-2 vs. M/S. CENTRAL BANK OF INDIA

PDF · subscribers

WP/5737/2014HC BombayHCBM01043517201316 July 2014Author: HON'BLE SHRI JUSTICE G. S. KULKARNI,HON'BLE SHRI JUSTICE M.S. SANKLECHA7 pages

AI SummaryDismissed

What did the High Court hold?

The High Court found no merit in the Revenue's contention. It held that at the time the petitioner's appeal was filed before the ITAT, the COD mechanism was operational. The Supreme Court's decision in Electronics Corporation of India Ltd. did not nullify or invalidate orders already passed under the COD mechanism. Instead, the Supreme Court merely stated that the mechanism had outlived its utility and would not be necessary going forward. Accepting the Revenue's interpretation would lead to the reopening of old and settled issues that were not considered fit for adjudication by the ITAT, causing uncertainty in closed matters. The Court concluded that the Revenue's interpretation of the Supreme Court's order was not a proper reading. Consequently, the High Court found no flaw in the ITAT's impugned order dated May 17, 2013, which rejected the petitioner's Miscellaneous Application.

What were the facts?

The petitioner, Commissioner of Income Tax-2, challenged an order dated May 17, 2013, passed by the Income Tax Appellate Tribunal (ITAT). The ITAT had dismissed the petitioner's Miscellaneous Application filed under Section 254(2) of the Income Tax Act, 1961. This application sought to recall the ITAT's earlier order dated August 2, 2010, pertaining to Assessment Year 1997-98. The basis for the recall application was that the ITAT had not considered four specific issues. This non-consideration was attributed to the Committee on Disputes (COD) having denied permission to prosecute these issues before the ITAT via an order dated January 14, 2001. The petitioner's application was filed in light of a Supreme Court order dated February 17, 2011, in the case of Electronics Corporation of India Ltd. vs. Union of India & ors., which recalled earlier directions regarding the COD mechanism.

What were the issues?

1. Whether the Supreme Court's decision in Electronics Corporation of India Ltd. vs. Union of India & ors., which stated the Committee on Disputes (COD) mechanism had outlived its utility, nullifies or invalidates prior orders passed under the COD mechanism, thereby obligating the ITAT to consider issues previously denied permission by the COD. Assessee's Contention (Revenue's argument in this context): The Revenue contended that in light of the Supreme Court's decision in Electronics Corporation of India Ltd., clearance from the COD is no longer necessary to file an appeal before the ITAT. Therefore, the prior denial of approval by the COD is legally void, and the ITAT is duty-bound to consider the four issues that were initially prevented from being agitated. Revenue's Contention (Assessee's argument in this context): The judgment does not record any specific contentions made by the assessee (M/s Central Bank of India) in response to the Revenue's petition.

Which sections of the Income-tax Act were involved?

Section 254(2)

AI-generated summary — verify with the full judgment below

Rng 1 wp5737.14 IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE CIVIL JURI ICTION WRIT PETITION NO.5737 OF 2014 Commissioner of Income Tax2.. . Petitioner vs. M/s Central Bank of India .. Respondents Mr.Suresh Kumar for Petitioner Mr.F.U.Irani i/b Mr.A.K.Jasani for Respondents …. CORAM : M.S.SANKLECHA & G.S.KULKARNI, J

DATED : 16 JULY, 2014 P. C. This petition under Article 226 of the Constitution of India seeks to challenge the order dated 17.5.2013 passed by the Income Tax Appellate Tribunal (ITAT) dismissing the petitioner's Misc.Application under section 254 (2) of the Income Tax Act 1961 (the Act) dated 5.12.2012 seeking a recall of its order dated 2.8.2010 passed for A.Y.199798. 2. The basis of the petitioner's Misc.Application was the non

Rng 2 wp5737.14 consideration of four issues by the ITAT as the Committee on Disputes (COD) by order dated 14.1.2001 denied permission to prosecute the issues in appeal before the ITAT. This Misc.Application for recall came to be filed in view of the order dated 17.2.2011 of the Supreme Court in Civil Appeal No.1883 of 2011 Electronics Corporation of India Ltd vs.Union of India & ors by which it recalled its earlier directions rendered in the matters of ONGC setting up the COD mechanism. This was on the ground that the mechanism of obtaining a clearance from COD has outlived its utility. Thus in the changed scenario the earlier directions of the Supreme Court in the matter of the ONGC case were recalled.

Mr.Suresh Kumar learned counsel for the Revenue in support of the petition states that in view of the Supreme Court decision in Electronics Corporation of India Ltd (supra) clearance/approval from the COD not being necessary to file an appeal to ITAT the non granting of approval by the COD is nonest in law. This being the position the ITAT is duty bound to consider all the four issues which

Rng 3 wp5737.14 were not allowed to be agitated before the ITAT by the COD.

We do not find any merit in the contention of the revenue. At the time when the petitioner's appeal was filed before the ITAT, the COD mechanism was very much in place. The petitioner had applied for the necessary permission to the COD to file and agitate 5 issues before the ITAT. The COD rejected 4 issues out of the 5 issues for which permission was sought. The order of the Supreme Court in Electronics Corporation of India Ltd (supra) does not nullify or invalidate the orders passed under the COD mechanism. The Supreme Court in Electronics Corporation of India Ltd (supra) has merely stated that the COD mechanism has outlived its utility and in the changed scenario,the COD mechanism would not be necessary. If the petitioner's contention are to be accepted then all applications which have been rejected by the COD during the period of its existence from 199192 up to the date of the decision of the Supreme Court on 17.2.2011 in the matter of Electronics Corporation of India Ltd would lead to raking up old and settled issues which were not

Rng 4 wp5737.14 found fit for consideration of the ITAT. If we accept the interpretation put by the revenue then all the parties to whom COD mechanism applied would be entitled to recall orders for fresh consideration leading to uncertainty in respect of closed matters. The interpretation of the revenue of the Apex Court's order in Electronics Corporation of India (supra) is not a proper reading of the same. In view of the above, we do not find any merit in the submissions made by Mr.Suresh Kumar the learned counsel for the revenue.

Consequently, we find no flaw in the impugned order dated 17.5.2013 of ITAT rejecting the petitioner's Misc.Application dated 6.12.2012 seeking a recall of the order dated 2.8.2010 for A.Y.1997

98.6.

Accordingly, petition is dismissed with no order as to costs. (G.S.KULKARNI, J) (M.S.SANKLECHA, J)

Rng 5 wp5737.14

Rng 6 wp5737.14

Rng 7 wp5737.14

Recent GST High Court judgments

Search GST case law →