… Smt. Seema Bhattacharya v. … Principal Commissioner Of Income Tax Ii

THE HIGH COURT OF MADHYA PRADESH : JABALPUR(Division Bench) Heard through Video Conferencing Income Tax Appeal No.34/2020 … Smt. Seema Bhattacharya Appellant versus … Principal Commissioner of Income Tax II Respondent ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- Appearance: Shri A.P. Shrivastava with Shri Sapan Usrethe, learned counsel forthe appellant. ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- CORAM: Hon’ble Shri Justice Sanjay Yadav, Acting Chief JusticeHon’ble Shri Justice Vijay Kumar Shukla,Judge ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- Date of decision : 01.12.2020 ……….……….……….……….……….……….……….……….……….……….……….……….……….……….……….……….……….……….……….……….……….…………….………. O R D E R Per Sanjay Yadav, Acting Chief Justice :- This Appeal under Section 260A of the Income Tax Act, 1961(for brevity, ‘the IT Act’), is directed against the order dated07.09.2020 passed by the Income Tax Appellate Tribunal, JabalpurBench Jabalpur in M.A. No.04/JAB/2020; whereby, I.T.A.No.225/JAB/2018 dated 07.09.2020 by Revenue was restored. ITA-34-2020 2.The pleadings and documents on record reveals that theTribunal in pursuance to Notification issued by the Central Board ofDirect Taxes under Section 268A of the IT Act stipulating that the‘tax effect’ as computed in terms of Circular 3 of 2018 dated11.07.2018 being less than 50 lacs, permitted the Department towithdraw the appeal by order dated 23.08.2019. The withdrawalwas, however, subject to: “7.It may be clarified that though every care has beentaken by the Registry of the Tribunal in identifying thelisted appeals, it may yet be that some error in workingthe tax effect may have occurred. It may also be that anappeal/s is otherwise saved by the exceptions listed atpara 10 (scope of which stands widened videamendment dated 20.08.2018) or para 11 of the Circular.Similarly, it may be that a CO/s bears an independentground/s, raised for adjudication. Accordingly, liberty ishereby granted to the parties to, where so, move theTribunal in this regard, in which case it shall, wheresatisfied on merits, recall an appeal/s or, as the case maybe, a CO/s, for being heard on merits. Further, the recallof an appeal would be accompanied by the recall of theassessee’s corresponding CO, if any, dismissed alongwith. Needless to add, the Tribunal shall, while doing so,which shall be per a speaking order, grant an opportunityof hearing to the other side. 8.In the result, all the appeals of the Revenue andCross Objections by the assesses stand dismissed.”Cross Objections by the assesses stand dismissed.” ITA-34-2020 3.That, an application under Section 254(2) of the IT Act wasfiled by the Revenue for recalling the order dated 23.08.2019 andfor restoration of Appeal on the sole ground that the Appeal inquestion qualified exceptional condition specified in para 10(c) ofthe Board’s Circular which mandates that: “10. Adverse judgment relating to the following issuesshould be contested on merits notwithstanding that the taxeffect entailed is less than the monetary limits specified inpara 3 above, or there is no tax effect: (a) ..., or(b) ..., or(c) where a Revenue Audit objection in the case hasbeen accepted by the Department, or(d)....,” 4.The Tribunal dwelling on the rival contentions, held: ITA-34-2020 3.That, an application under Section 254(2) of the IT Act wasfiled by the Revenue for recalling the order dated 23.08.2019 andfor restoration of Appeal on the sole ground that the Appeal inquestion qualified exceptional condition specified in para 10(c) ofthe Board’s Circular which mandates that: “10. Adverse judgment relating to the following issuesshould be contested on merits notwithstanding that the taxeffect entailed is less than the monetary limits specified inpara 3 above, or there is no tax effect: (a) ..., or(b) ..., or(c) where a Revenue Audit objection in the case hasbeen accepted by the Department, or(d)....,” 4.The Tribunal dwelling on the rival contentions, held: “In the present case, speaking for all the 96appeals/COs, no counsels, other than those listed, werepresent during ‘hearing’. All this is in fact a matter of theTribunal’s record. The claim of proper opportunity havingbeen provided by the Tribunal to the Revenue for raisingobjection/s, implicit in the charge of it having not raisedany objection at the time of hearing, is thus a figment ofimagination; the co-author of the impugned order being aconstituent of the Bench that heard the matters. There is,accordingly, no reference to any argument, by either side,in the impugned order, much less any mention of provision of opportunity to raise any specific objection;the Bench making it clear that the listed matters had beenso on being identified on the basis of the revised monetarylimit qua tax-effect per the recently issued Board circularof August 8, 2019, enhancing the same for themaintainability of the Revenues’ appeals before theTribunal. The impugned order is thus not maintainable on thisshort ground alone, i.e., non-provision of any opportunity,or in any case proper opportunity, of being heard. TheTribunal, while doing so, was acutely conscious of thelegal infirmity of this course; the pitfalls it entailed; andit’s duty towards the litigants, i.e., the tax payers and theRevenue. Accordingly, keen to avoid any prejudice beingcaused by proceeding in the manner it does, it, even asmade clear earlier in the open court, preempting theraising of any objection by the Revenue, provided libertyto the parties to move the Tribunal where any appeal orCO, not covered u/s 268A, has nevertheless beendismissed by it in limine. ….. .... The revenue’s applications are thus admissible bythe very terms of the impugned order itself, i.e., the libertyprovided per the impugned order. Though, therefore, theapplications are u/s 254(2), its strict parameters, asnormally obtain, would not apply thereto, it is in fact thisliberty which makes the said order legally sustainable inview of the short shrift given to the due process of hearing, fundamental to the judicial decision making process and,thus, to a judicial order. The instant applications, thus,become the first occasion for the Revenue (assessee) toobject to its’ appeal (CO) being wrongly dismissed u/s268A, even as contemplated by the impugned order, aswell as the order relied upon by it. The Tribunal is thusobliged to consider and decide the Revenue’s objection’son merits, as the leave granted per the impugned orderitself provides. How, one may ask, does the decision inConcord Pharmaceuticals Ltd. (supra) assists theassessee/s under such circumstances; the same, rather, inview of the position of law as clarified thereby, does thatof the Revenue. Each of the Revenue’s applications areliable to be allowed, restoring the appeals (along with theCOs’ if any) for being heard on merits, subject to thesatisfaction, after hearing the parties, that the appeals arenot covered by the extant circular/s.” 5.Though the appellant press in service following substantialquestion of law: 5.Though the appellant press in service following substantialquestion of law: “Under the garb of rectification under Section254(2), whether Tribunal was justified in recalling theappeal, when appeal was heard in the presence of theappellant and the respondent and when the Tribunal isnot vested with power to recall the appeal.” However, in the given facts of present case, the substantial question as proposed does not arise for consideration. ITA-34-2020 6.It being the fundamental principle for administration of justicethat an act of the Court shall prejudice no man (actus curiaeneminem gravabit). In the case at hand, as there was no occasion forTribunal to have considered the merit of ITA No.225/JAB/2018 forAY 2009-10 and the same could not have been dismissed aswithdrawn being covered by the exceptional conditions contained inpara 10(c) of the Board’s Circular, we do not perceive anyjurisdictional or legal error in the order as would attract theproposed substantial question of law. 7.Consequently, Appeal fails and is dismissed. No costs. vinod (Sanjay Yadav) Acting Chief Justice (Vijay Kumar Shukla) Judge Digitally signed by VINOD VISHWAKARMA Date: 2020.12.08 17:45:39 +05'30'