Judges do not make law, they only discover or find correct law

As is the settled legal posit ion, in the light of Hon’ble Supreme Court’s decision in the case of ACIT –vs. – Saurashtra Kutch Exchange Ltd. (305 ITR 227) , a judicial decision acts retrospectively. As Their Lordships observed in this case, judges do not make the law, they only discover or find the correct law and, therefore, a rectification of mistake in an order can also be carried out in the light of Hon’ble Supreme Court’s judgment passed after the subject order is passed. The action of the CIT (Appeals) was thus correct and does not call for any interference.

INCOME TAX APPELLATE TRIBUNAL,KOLKATA 

I .T.A. No. : 266/ Kol . / 2012

Assessment year: 2005-06

Deputy Commissioner of Income Tax

-Vs. –

M/s. North Brook Jute Co. Ltd.

Date of pronouncing the order: June 29, 2012

 O R D E R

Per Pramod Kumar:

1. By way of this appeal, the Assessing Officer has challenged correctness of Commissioner of Income Tax (Appeals)’s order dated 04.11.2011 in the matter of order u/s. 154 r.w.s. 143(3) of the Income Tax Act, 1961, for the assessment year 2005-06. The appeal is time barred by five days, but having perused the condonation petition, we condone the delay. Grievance raised in the appeal is as follows:-

“That on the facts and in the circumstances of the case, ld. CIT(A) has erred in cancelling the order of the AO by rejecting the rectification petition of the assessee”.

2. The issue in appeal lies in a narrow compass of material facts. During the course of assessment proceedings, the Assessing Officer disallowed delayed payments of employees’ contributions towards Provident Fund and Employees State Insurance. Subsequently, assessee moved a rectification petition u/s. 154 pointing out that in view of Hon’ble Supreme Court ’s decision in the case of CIT vs. Alom Extrusions Ltd. (227 CTR 417), the deduction not having been allowed was a mistake apparent from record. The Assessing Officer rejected the petition, inter alia, on the ground that Hon’ble Supreme Court decision was not available at the point of time when assessment order was passed. Aggrieved, assessee carried the matter in appeal before the CIT(Appeals), who upheld the grievance of the assessee. The disallowance was, accordingly, deleted. The Assessing Officer is aggrieved of the relief so granted by the CIT(Appeals) and is in appeal before us.

3. We have heard the learned Departmental Representative, perused the material on record and duly considered facts of the case in the light of applicable legal position.

4. As is the settled legal posit ion, in the light of Hon’ble Supreme Court’s decision in the case of ACIT –vs. – Saurashtra Kutch Exchange Ltd. (305 ITR 227) , a judicial decision acts ret rospectively. As Their Lordships observed in this case, “judges do not make the law, they only discover or find the correct law” and, therefore, a rectification of mistake in an order can also be carried out in the light of Hon’ble Supreme Court’s judgment passed after the subject order is passed. The action of the CIT (Appeals) was thus correct and does not call for any interference.

5. In the result, the appeal filed by the Revenue is dismissed.

Order pronounced in the open court on 29t h day of June, 2012.