Wp/1279/2020 Of Bhalaria Steel Corporation v. Income Tax Officer-18(1)(2), Mumbai And Anr

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTIONWRIT PETITION NO.1279 OF 2020 Bhalaria Steel Corporation ….Petitioner V/s. Income Tax Officer-18(1)(2) & Ors …Respondents ---- Mr. Devendra H. Jain for Petitioner. Ms Sushma Nagaraj, Sr. Standing Counsel a/w Ms Vibhuti Keny forRespondents. ---- CORAM : K.R. SHRIRAM & M.M. SATHAYE JJ DATED : 13[th] JUNE 2023 P.C. : 1This petition is filed impugning an order dated 23[rd] October 2019rejecting petitioner’s misc application seeking to recall the exparte orderpassed by the Income Tax Appellate Tribunal (ITAT) on 27[th] May 2009. 2On 2[nd] March 2021, respondents were directed to file reply by thenext date and the matter was stood over to 25[th] March 2021. The matterwas also listed on 6[th] June 2023 and stood over to today. Over 2 years and3 months have passed still no reply is filed opposing the petition andtherefore, we are not inclined to grant any further time though, Ms Nagarajrequested for time. 3Petitioner had filed an appeal before the ITAT which came to bedismissed for default on 27[th] May 2009. The order says that the notice of hearing has been sent on 6[th] April 2009 by RPAD and the same has not beenreturned unserved and, therefore, notice is deemed to have been served. Itis stated in order that “…………. It can be therefore be reasonablyconcluded that the assessee is not interested in pursuing the appeal. Wetherefore dismiss the appeal of the assessee………..” 4On or about 3[rd] December 2018, petitioner filed misc application forrecalling of the order of dismissal. Petitioner relied upon Rule 24 of theIncome Tax (Appellate Tribunal) Rules 1963. In the affidavit in support ofthe application, petitioner has expressed surprise that the appeal came to bedismissed. Petitioner has stated that petitioner had been regularly followingup with the department from time to time and had addressed sixcommunications and had also mentioned in those communications that theappeal was pending before the Tribunal. Petitioner was always under theimpression that the appeal was pending and was never been told by theAssessing officer about the dismissal of the appeal. In the affidavit, it is alsostated that the Assessing officer in fact asked petitioner to submitphotocopies of all documents to restructure the file since he was not havingpapers with him. Petitioner has also stated that somewhere in May 2018 anew Chartered Accountant firm has been appointed for the purpose ofaudit of petitioner’s account for AY-2017-2018 onwards. The new auditorsfound about the under protest payment made by petitioner for AY-2003-2004 and AY-2004-2005, which was continuing in petitioner’s books ofaccount and they made inquiry about the pending status of the appeal in the ITAT. At that stage, sometime in the first week of June 2018 petitioner cameto know about the dismissal of the appeal and petitioner received a copy ofthe order on 18[th] June 2018. Thereafter, this application for restoration wasfiled. 5In the impugned order, however, it is recorded that petitioner came toknow about the disposal of the appeal only when recovery proceedings fordemand were enforced by the Assessing Officer on petitioner. This iscontrary to what is stated in the application for recall of the order. We alsofind in the impugned order that the Tribunal has not considered petitioner’ssubmissions about petitioner’s repeated follow up with the department andthe 6 letters addressed to the department. Therefore, it does not appear tobe a case where petitioner had slept over the matter or abandoned theappeal. In our view, this was a fit case where order of dismissal passed on27[th] May 2009 should have been recalled. Accordingly, we quash and setaside the impugned order dated 23[rd] October 2019, as also the originalorder dated 27[th] May 2009 dismissing the appeal and restore the AppealNo.ITA No.7220/M/2007 to file of ITAT. 6Since the matter relates to AY-2004-2005, we would hope that theTribunal decides this matter expeditiously, subject to its schedule, as early aspossible and preferably before 31[st] December 2023. 7At this stage, Ms Nagaraj states since the court has allowed thepetition, petitioner should atleast be put to terms. Mr. Jain in response statesthat petitioner will pay as donation any reasonable amount as the court may direct to any charity. Petitioner to give donation of Rs.1,00,000/- to PM Cares Fund. The account details are as under : Name of the Account : PM CARESAccount Number : 60355358964IFSC : MAHB0001160Branch : UPSC - New Delhi This amount shall be paid within four weeks from today and proof ofpayment shall be filed by way of affidavit within four weeks from the timethis order is uploaded, failing which the restored appeal will standdismissed without further reference to the court or ITAT. (M. M. SATHAYE, J.) (K.R. SHRIRAM, J.)