M/S.universal Cold Storage Ltd., Chennai-41 v. The Deputy Commissioner Of Income Tax, Company Circle Iii(3), Chennai-34

In the High Court of Judicature at Madras The Honourable Mr.Justice T.S.SIVAGNANAM and The Honourable Mrs.Justice V.BHAVANI SUBBAROYAN M/s.Universal Cold StorageLtd., Chennai-41. ...Appellant VsThe Deputy Commissioner of Income Tax, Company Circle III(3),Chennai-34....Respondent APPEAL under Section 260A of the Income Tax Act, 1961 againstthe order dated 29.8.2008 made in MP.No.176/Mds/2008 inITA.No.1725/Mds/ 2004 on the file of the Income Tax AppellateTribunal, Chennai 'B' Bench for the assessment year 2000-01,against the order dated 22/02/2006 mde in ITA No.1725/MDS/04 onthe file of the Income Tax Appellate Tribunal Bench B Chennaifor the assessment year 2000-01, against the order dated16/03/2004 made in ITA No.13/2003-04/AIII on the file of theCommissioner of Income Tax (Appeals)-IIIV, Chennai for theassessment year 2000-01, against the order dated 27/3/2003 madein GIR No./PAN No.33095-U/ on the file of theAssistant Commissioner of Income Tax Company circle III(3)Chennai, for the assessment year 2000-01. Judgment was delivered by T.S.Sivagnanam,JWe have elaborately heard Mr.A.S.Sriraman, learned counselfor the appellant – assessee and Mrs.S.Premalatha, learnedJunior Standing Counsel appearing on behalf of Mr.M.Swaminathan,learned Senior Standing Counsel appearing for the respondent –Revenue. https://hcservices.ecourts.gov.in/hcservices/ 2. This appeal, filed by the assessee under Section 260A ofthe Income Tax Act, 1961 (for short, the Act), is directedagainst the order dated 29.8.2008 made in MP.No.176/Mds/2008 inITA.No.1725/Mds/2004 on the file of the Income Tax AppellateTribunal, Chennai 'B' Bench (for brevity, the Tribunal) for theassessment year 2000-01.3. The appeal was admitted on 08.12.2009 the followingsubstantial questions of law : “i. Whether the Appellate Tribunal iscorrect in law in dismissing themiscellaneous petition filed in terms ofSection 254(2) of the Act for the recall ofthe ex parte order passsed in the disposalof the appeal filed before them ? Andii. Whether the Appellate Tribunal iscorrect in law in dismissing themiscellaneous petition in terms of Section254(2) of the Act for the recall of the exparte order overlooking the provisions ofRule 25 of the Appellate Tribunal Rules,1963 as well as overlooking the reasonsgiven for adjournment of hearing of theappeal filed before them ?”4. The assessee is before us challenging the order passed ina miscellaneous petition filed by the assessee to recall theorder passed by the Tribunal dated 22.2.2006. The appeal wasfiled before the Tribunal challenging the order passed by theCommissioner of Income Tax (Appeals)-III, Chennai-34 [for short,the CIT(A)] dated 16.3.2004 whereby the appeal filed by theassessee was allowed. 5. It appears that the appeal was listed before the Tribunalon 17.2.2006, which was stated to be the first date of hearing.On that day, a petition for adjournment was filed by the learnedcounsel for the assessee. In the said petition for adjournment,it has been stated that the counsel had received instructionsfrom the assessee to represent the matter and requested for anadjournment, as the assessee was not in a position to furnishthe appeal records. It has been further stated in the saidmiscellaneous petition that as against the order passed by theCIT(A), the assessee also filed an appeal and a request was madeto the Tribunal to take up both the appeals. The assesseefurther pleaded that the inconvenience caused to the Tribunalmight be regretted. 5. It appears that the appeal was listed before the Tribunalon 17.2.2006, which was stated to be the first date of hearing.On that day, a petition for adjournment was filed by the learnedcounsel for the assessee. In the said petition for adjournment,it has been stated that the counsel had received instructionsfrom the assessee to represent the matter and requested for anadjournment, as the assessee was not in a position to furnishthe appeal records. It has been further stated in the saidmiscellaneous petition that as against the order passed by theCIT(A), the assessee also filed an appeal and a request was madeto the Tribunal to take up both the appeals. The assesseefurther pleaded that the inconvenience caused to the Tribunalmight be regretted. 6. The Tribunal proceeded on the basis that there was noappearance for the assessee and allowed the appeal filed by theRevenue. To recall the order passed by the Tribunal dated22.2.2006, the assessee filed a miscellaneous petition on03.7.2008 and it was rejected by the Tribunal by the impugnedorder on the ground that the assessee was not able to point outany mistake in the said order. 7. In our considered view, no litigant would stand benefitedby not appearing before a court or tribunal or belatedlyappearing before a court or tribunal. Therefore, the Courts haveheld that the bona fides of the parties should be examinedbefore a tough decision is taken. The assessee's appeal waspartly allowed by the CIT(A). The Tribunal, while recording thatnone appeared for the assessee, had not referred to the petitionfor adjournment filed by the assessee's counsel and proceeded toallow the Revenue's appeal by placing reliance on the decisionof the Hon'ble Supreme Court in the case of IPCA LaboratoriesVs. DCIT [reported in 266 ITR 521]. 8. The assessee's case is that the said decision will have noapplication to the facts of the assessee's case. 9. In any event, in our considered view, 17.2.2006 being thefirst date of hearing, the Tribunal could have accommodated therequest made on behalf of the assessee. 10. It is brought to our notice that the issue before theTribunal was a recurrent issue and that the assessee succeededfor the earlier years. 11. In the light of the above, we find that the appeal beforethe Tribunal should be heard on merits, for which reason, theabove tax case appeal is allowed. We set aside the order dated29.6.2008 made in MP.No.176/Mds/ 2008 in ITA.No.1725/Mds/2004and direct the Tribunal to take up the miscellaneous petitionand consider the case of the assessee so that the order dated22.2.2006 could be recalled and the appeal could be heard onmerits. This direction is issued as we are conscious of the factthat the assessee did not impugn the order passed by theTribunal dated 22.2.2006. Had that been done, we would have beenwell justified in invoking our jurisdiction to set aside the exparte order and remit the matter for a fresh consideration. Inthe absence of a specific a challenge to the order dated22.2.2006, we direct the Tribunal to entertain the miscellaneouspetition and re-hear the main matter on merits. The substantialquestions of law are left open. No costs. Sd/-Assistant Registrar(CS-VIII) RSTo //True copy//Sub Assistant Registrar 1.The Income Tax Appellate Tribunal, Chennai 'B' Bench. 2.The Assistant Commissioner of Income Tax, Company Circle III(3), Chennai-34. Company Circle III(3), Chennai-34. https://hcservices.ecourts.gov.in/hcservices/ 3. The Commissioner of Income Tax Appeals) -IIIV, Chennai +1cc to Mr.S.Sridhar, Advocate SR.No.68786 +1cc to Mrs.S.Premalatha, Advocate SR.No.69547 TCA.No.1021 of 2009 RSV(CO)GMY(09/09/2019)