Case Law Details
By this application, the assessee seeks recall of the order dated 21.06.2016 on the ground that the Tribunal erred In holding that the assessee did not furnish any evidence with regard to the unexplained investment, overlooking the fact that written submissions were filed which contained detailed explanation.
2. At the outset it may be noticed that as per the present practice followed by the Tribunal, the order was pronounced on 21.06.2016 in the open court and the time limit, reckoned from the end of the month in which the order was passed, is six months for seeking recall i.e., parties are entitled to seek rectification of the said order within six months u/s 254(2) of the Income Tax Act, 1961, as amended w.e.f. 01.06.2016 which reads as under:-
“254 (2) The Appellate Tribunal may, at any time within “six months from the end of the month in which the order was passed”, with a view to rectify any mistake apparent from the record, amend any order passed by it under sub-section (1), and shall make such amendment if the mistake is brought to its notice by the assessee or as the Assessing Officer.”
3. The abovementioned provision empowers the Tribunal to suo moto rectify its mistake or enable the parties to the order to seek rectification within the period of limitation i.e., “Six months in which the order was passed”. In the instant case, the order was passed/ pronounced on 21.06.2016 and from the end month, the period of six month expires on 31.12.2016. Assessee filed the present Miscellaneous Application (MA) on 20.01/2017 on the ground that the order was served upon the assessee on 05.07.2016; Reckoning the the period limitation. The case of the assessee is that the procedures as well as the period of limitation set out In the Act are mainly Intended to subserve the interest of the parties and in tax matters it cannot be considered as lis between in two parties but only tax adjustment, as hold by the Hon’ble Madras High Court in the case of CIT vs, Indian Express (Madural) Pvt,114 (140 ITR 705 at 722). Substantial justice has to be given paramount Importance and in this case, the Tribunal has overlooked the material papers flied and therefore, the assessee should be given one more opportunity to put forth Its grievance by recalling the order pacsed by the Tribunal. Accordingly, Ld Counsel for the assessee submitted that the expression “order was passed” has to be understood as “date of receipt of the order by the parties”. Ld Counsel for the assessee filed brief written submissions incorporating the provisions of sections 254(2), 254(3) of the Act and Rules 34(1) and 35 of the ITAT Rules, 1963 to submit that it is mandatory to serve a copy of the order on the parties and hence, the time limit, starts only from the ‘date of receipt of the order’. He referred to the orders of the Hon’ble Delhi High Court In the case of CIT vs. Sudhir Choudhrie: Rajiv Chotitihrie [2005] 278 ITR 490 wherein, the Court observed that pronouncement of the order is mandatory so as to facilitate the parties to lawfully know the result as well as to avoid unnecessary delay in communication of the orders. He, further, relled upon the decision of the Hon’ble Madras High Court in the case of S.P. Balasubrahniiinyoni vs, ACIT [2017] 152 DTR 25 (Mad.), at page 34 wherein the Court referred to the, provisions of section 12 of the Limitation Act, which speaks of the time taken for obtaining the copy of the decree or order while computing the period of limitation. In para 21 of the judgment, the Hon’ble Madras High Court observed as under:-
“21. Even. taking for granted that the judgments of the Apex Court are applicable to the case on hand and that the period of limitation of four years for filing an application for recalling an order filed u/s 254(2) of the IT Act, 1961, has to be computed from the date of service of the order, averments made in the said petition, filed in the year 2015, are bereft of details, as to when the order was served in the address, where the office of the appellant is situated. Order of the Tribunal In ITA No. 638/Mad/2011 has been passed on 18th July, 2011, whereas, the appellant has filed the petition on 24th July, 2015, which is beyond four years from the date of passing of the order by the Tribunal On 18th July, 2011. Though Mr. Ja. Balachander, Ld Counsel for the appellant submitted that in the normal course, service of order, on the party would take some time, and therefore the miscellaneous application filed on 24th July, 2015 was just six days exceeding the four years period from the date of passing the order and therefore, the Tribunal ought to have considered the time taken for service of the impugned order and allowed the application for rectification, we are not inclined to accept the said contention, for the reason that, there are no averments in the miscellaneous petition, as to when the order was served on the appellant”
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