Iapl/138/2018 Of Dr. Gopal Dass Agarwal v. Commissioner Of Income Tax

Case :- INCOME TAX APPEAL No. - 138 of 2018 Appellant :- Dr. Gopal Dass AgarwalRespondent :- Commissioner Of Income TaxCounsel for Appellant :- Shambhu ChopraCounsel for Respondent :- S.S.C.,Manu Ghildyal,Piyush Agrawal With Case :- INCOME TAX APPEAL No. - 139 of 2018 Appellant :- Dr. Gopal Dass AgarwalRespondent :- Commissioner Of Income TaxCounsel for Appellant :- Shambhu ChopraCounsel for Respondent :- S.S.C.,Manu Ghildyal,Piyush Agrawal Hon'ble Pankaj Mithal, J.Hon'ble Pankaj Bhatia, J. Heard Sri Shambhu Chopra, learned counsel for theappellant and Sri Manu Ghildyal, learned counsel for therespondents. Both the aforesaid appeals arise out of a commondispute, therefore, are being decided together by thiscommon order. The appellant has preferred these appeals against theorders of the tribunal dated 18.6.2018 by which theapplications for recall of the order dated 23.10.2017 havebeen rejected. The facts of the case reveal that against the order of theCommissioner of Income Tax (Appeals), Meerutpertaining to the assessment years 2005-06 & 2011-12.,the Revenue had preferred appeals before the Tribunal.The appeals were decided on 18.6.2018 against theassessee. The assessee moved applications for recall ofthe above orders on the ground that it had movedapplications on 10.10.2017 for adjournment of theappeals on the personal ground of the counsel, butwithout considering the said applications, the appealswere heard and the judgment was delivered on23.10.2017. Therefore, the orders were passed withoutproper opportunity of hearing to the assessee and areliable to be recalled. The Tribunal has rejected the above applications on the ground that the order of the Tribunal does not require anyrectification and there is no power of review vested in theTribunal. The moot question which raised for consideration iswhether the Tribunal is divested of the power to recall anorder passed by it in violation of the principles of naturaljustice, if so established. The power of rectification and the power of substantivereview are two different things distinct from proceduralreview which encompasses the power to recall an order. The power of procedural review to recall an order isinherent in every authority which exercises quasi judicialjurisdiction. Therefore, even if there is no specific powerof review vested in the Tribunal, it has inherent power toconsider the application for recall of an order passed by itif it is established that it has been passed in violation ofthe principles of natural justice or by playing fraud uponit. This apart, Rule 25 of the Income Tax (Appellate Tribunal)Rules, 1963 provides for the hearing of the appeal ex-parte for default of the respondents. It lays down that inan appeal where the appellant appears and therespondents does not appear when the appeal is takenup for hearing, the Tribunal may dispose of the appeal onmerits after hearing the appellants. It further provides thatwhere the appeal has been disposed of in the abovemanner and the respondents appears afterwards andsatisfies the Tribunal that there was sufficient cause forhis non appearance, the Tribunal shall set aside the orderand restore the appeal for hearing on merits. The aforesaid Rule 25 is reproduced herein below :- "25. Hearing of appeal ex parte for default by the respondent.-Where, on the day fixed for hearing or any other day to which thehearing may be adjourned, the appellant appears and therespondent does not appear in person or through an authorisedrepresentative and the appeal is called on for hearing, the Tribunalmay dispose of the appeal on merits after hearing the appellant :Provided that where an appeal has been disposed of as providedabove and the respondent appears afterwards and satisfies theTribunal that there was sufficient cause for his non-appearancewhen the appeal was called on for hearing, the Tribunal shall makean order setting aside the ex-parte order and restore the appeal." The aforesaid Rule 25 is reproduced herein below :- "25. Hearing of appeal ex parte for default by the respondent.-Where, on the day fixed for hearing or any other day to which thehearing may be adjourned, the appellant appears and therespondent does not appear in person or through an authorisedrepresentative and the appeal is called on for hearing, the Tribunalmay dispose of the appeal on merits after hearing the appellant :Provided that where an appeal has been disposed of as providedabove and the respondent appears afterwards and satisfies theTribunal that there was sufficient cause for his non-appearancewhen the appeal was called on for hearing, the Tribunal shall makean order setting aside the ex-parte order and restore the appeal." In view of the above Rule, it is implicit that the Tribunalhas statutory power to recall its order if it is satisfied that the respondent has failed to appear before it for sufficientcause, at the time of hearing and to restore the appeal.Thus, it cannot be said that the Tribunal has no authorityof law to consider the application of the assessee forrecall of an order by which the appeal was decided ex-parte. In view of the above, the Tribunal is not justified inrejecting the applications of the appellant-assessee onthe ground that it has no power to review the orderalready passed by it. Accordingly, we answer the abovequestion in favour of the appellant-assessee and holdsthat the Tribunal has inherent power of procedural reviewas has also been conferred upon it under Rule 25 of theIncome Tax (Appellate Tribunal) Rules, 1963. The impugned orders dated 18.6.2018 for theassessment years 2005-06 and 2011-12 are hereby setaside and the matters are remanded to the Tribunal forreconsideration of the applications of the appellant-assessee (wrongly filed by mentioning Rule 234-A of theIncome Tax Appellate Tribunal Rules, 1963 instead ofRule 25) for recall of the judgments and orders dated23.10.2017. It is also pertinent to mention that theTribunal in considering the above applications afreshwould also consider, if any adjournment application asstated by the appellant-assessee was moved and wasconsidered before pronouncing the final order. The appeals are accordingly allowed with no order as to costs. Order Date :- 5.12.2018Hasnain