PR. COMMISSIONER OF INCOME TAX (CENTRAL)-2 vs. GREEN MARK INFRA LTD.

Allowed, subject to just exceptions. CM APPL. 6763/2023 in ITA 78/2023 CM APPL. 6765/2023 in ITA 79/2023 [Applications filed on behalf of the appellant seeking condonation of delay of 100 days in re-filing the appeal]

These are applications filed on behalf of the appellant/revenue seeking condonation of delay in re-filling the appeals.

According to the appellant/revenue, there is delay of 100 days.

For the reasons given in the applications, the delay in re-filling the Digitally Signed By:ATUL JAIN Signing Date:14.03.2023 12:03:38 Signature Not Verified

The applications are disposed of in the aforesaid terms. ITA 78/2023 ITA 79/2023

These appeals are directed against order dated 01.04.2022 passed by the Income Tax Appellate Tribunal [in short, “Tribunal”] concerning MA No. 756 preferred in ITA 6208/Del/2015 and MA No. 755 preferred in ITA 6207/Del/2015. 6. 1. ITA 78/2023 concerns Assessment Year (AY) 2009-10, while ITA 79/2023 concerns AY 2008-09. 7. The appellant/revenue is aggrieved by the fact that via the aforementioned order the Tribunal has recalled its order dated 26.10.2018 which was passed on merits.

Mr Sanjay Kumar, learned senior standing counsel, who appears on behalf of the appellant/revenue, says that since the above-referred applications were filed by the respondent/assessee under Section 254(2) of the Income Tax Act, 1961 [in short, “Act”], the Tribunal could not have recalled the order dated 26.10.2018, as the same was rendered on merits.

A careful perusal of the record would show that the Tribunal, while noting the appearances of the representatives of the parties, had noted the following:

This was, clearly, a mistake made while noting the appearances of the parties. Digitally Signed By:ATUL JAIN Signing Date:14.03.2023 12:03:38 Signature Not Verified

Insofar as the impugned order is concerned, the Tribunal was persuaded to recall the order dated 26.10.2018, as the respondent/assessee had asserted that it had not received notice of the date when the concerned appeals were fixed for hearing.

In support of this plea, [as recorded in paragraph 2 of the impugned order], an affidavit of the Director of the respondent/assessee was filed. This aspect [as recorded by the Tribunal in paragraph 3 of the impugned order], was not controverted by the appellant/revenue.

Given this position, the Tribunal observed in paragraph 4 the impugned order that the appellant/revenue had placed no material before it which would suggest that the reasons given by the respondent/assessee for non-appearance, on the date fixed for hearing, were false.

Having regard to the aforesaid position, the Tribunal went on to hold that it was a well-settled principle of law that opportunity of hearing should be accorded to the disputants and that no disputant should be condemned unheard. Accordingly, the Tribunal, in the interest of justice, recalled its ex parte order [i.e., order dated 26.10.2018] which had been passed on merits.

As noted hereinabove, there was certainly a mistake in recording the appearances in the matter.

Besides this, even if, for the moment, we were to agree with Mr Kumar that the order could not have been recalled by the Tribunal by taking recourse to Section 254(2) of the Act, we are, certainly, of the view that this was an incidental and ancillary power available to the Tribunal. [See Income Tax Officer, Cannanore v M.K. Mohammed Kunhi AIR 1969 SC 430.]

That said, under Section 254(2) of the Act, the Tribunal has the Digitally Signed By:ATUL JAIN Signing Date:14.03.2023 12:03:38 Signature Not Verified

Given this position, contrary to what Mr Sanjay Kumar has contended, the Tribunal could have corrected its mistake, to do right by the party who was inadvertently wronged. [See Honda Siel Power Products Ltd. v Commissioner of Income Tax, Delhi (2007) 12 SCC 5961]

Furthermore, any which way the Tribunal, in our opinion, has power conferred upon it under Rule 25 of the Income Tax Appellate Tribunal

….When prejudice results from an order attributable to the Tribunal's mistake, error or omission, then it is the duty of the Tribunal to set it right. Atonement to the wronged party by the court or tribunal for the wrong committed by it has nothing to do with the concept of inherent power to review. In the present case, the Tribunal was justified in exercising its powers under Section 254(2) when it was pointed out to the Tribunal that the judgment of the coordinate Bench was placed before the Tribunal when the original order came to be passed but it had committed a mistake in not considering the material which was already on record. The Tribunal has acknowledged its mistake, it has accordingly rectified its order. In our view, the High Court was not justified in interfering with the said order. We are not going by the doctrine or concept of inherent power. We are simply proceeding on the basis that if prejudice had resulted to the party, which prejudice is attributable to the Tribunal's mistake, error or omission and which error is a manifest error then the Tribunal would be justified in rectifying its mistake, which had been done in the present case.”

As is evident from the discussion above, sufficient cause having been provided, the Tribunal felt impelled to recall its order dated 26.10.2018. It is more than well-established that even if a judicial or a quasi-judicial authority does not refer to the source of its power in support of its action, as long as the power is otherwise available, no fault can be found with the exercise of the power. This is one such instance.

We find no merit in the above-captioned appeals. The appeals are, accordingly, dismissed.