2013 (10) TMI 213 - HC - Income Tax

Power of Tribunal to recall its earlier order and hear the appeal afresh - power to review or power of rectification Held that - Tribunal proceeded to decide certain issues on merits without giving full opportunity to the aggrieved party to make submissions thereon, the order did certainly suffer from an error apparent on the record. Tribunal, therefore, committed no error in exercising power of rectification - Tribunal, therefore, committed no error in exercising power of rectification. - By recalling the said order, the Tribunal cannot seem to have recalled its earlier conclusions Reliance has been placed upon the judgment in the case of Neesa Leisure Ltd. v. Union of India Through Secretary 2011 (3) TMI 706 - Gujarat High Court Decided against the Revenue.

Summary

Issues:
Challenging validity of Tribunal's order under Section 254(2) of the Income Tax Act.

Analysis:
The case involved a challenge to the order of the Income Tax Appellate Tribunal (Tribunal) dated 23.7.2012, where the Tribunal exercised powers under Section 254(2) of the Income Tax Act. The respondent assessee had appealed before CIT(Appeals) and the Tribunal, with the latter dismissing the appeal of the Revenue after an elaborate discussion. A Miscellaneous Application under Section 254(2) was filed by the respondent, which was allowed by the Tribunal on 23.7.2012, leading to the recall of its own order dated 30.3.2012 for rehearing the appeal.

The main contention raised by the Revenue was that the Tribunal had no authority to examine the validity of search proceedings, citing a previous court decision. The Revenue argued that the Tribunal's order was flawed and should be set aside, claiming that the Tribunal had no power of review. The assessee maintained that the Tribunal's role was limited to considering the challenge to the search's validity, not the merits of the case. The Tribunal, after considering both parties' arguments, decided to recall its order for rehearing as the assessee was not given the opportunity to argue on merits during the initial hearing.

A similar issue had arisen in a previous case, where it was found that no arguments on merits had been presented before the Tribunal. The Court dismissed the petition in that case, as it did in the present case, based on the lack of substantial evidence to contradict the Tribunal's recollection of the oral hearing. The Court clarified that the Tribunal had not recalled its earlier conclusions by recalling the order, and it was within the Tribunal's authority to rectify its decision if it had not provided a full opportunity for submissions. The Court emphasized that it had not expressed an opinion on the applicability of a specific court decision.

In conclusion, the Court dismissed the present petition, following the same reasoning as in the previous case, and clarified that the Tribunal's actions were within its jurisdiction, and the petition lacked merit.