2018 (5) TMI 1936 - AT - Income Tax

Rectification u/s 254 - order pronounced by tribunal beyond the period of 90 days from the conclusion of the hearing - HELD THAT - Respectfully following the aforesaid decision(s) of G. Shoe Exports v. ACIT 2016 (12) TMI 1140 - ITAT MUMBAI which has elaborately discussed this issue w.r.t. pronouncement of the orders by tribunal and other decisions of Hon ble Court(s) cited by the learned counsel for the assessee, we allow this MA filed by the assessee on this short ground of pronouncing of the order beyond a period of 90 days, keeping in view Rule 34(5) of Income Tax (Appellate Tribunal) Rule, 1963 r.w.s 254(2) of the Act

Issues Involved:
1. Recall of Tribunal Order
2. Pronouncement Delay Beyond 90 Days
3. Applicability of Rule 34(5) of ITAT Rules, 1963
4. Jurisprudence on Delayed Pronouncements

Issue-wise Detailed Analysis:

1. Recall of Tribunal Order:
The assessee filed a miscellaneous application (MA No. 151/Mum/2016) seeking the recall of the tribunal order dated 01.02.2016 in ITA No. 1994/Mum/2013 for the assessment year 2007-08. The primary contention was that the order was pronounced beyond the 90-day period stipulated by Rule 34(5) of the Income-tax (Appellate Tribunal) Rules, 1963, read with Section 254(2) of the Income Tax Act, 1961. The learned counsel for the assessee argued that the hearing concluded on 29.10.2015, but the order was pronounced on 01.02.2016, exceeding the 90-day limit.

2. Pronouncement Delay Beyond 90 Days:
The learned counsel for the assessee cited several judicial precedents, including the decisions of the Hon'ble Bombay High Court in Shivsagar Veg. Restaurant v. ACIT [2009] 317 ITR 433 (Bom) and Otters Club v. DIT (E) [Writ Petition No. 2889 of 2016, dated 12.01.2017], and the Hon'ble Supreme Court in ACIT v. Saurashtra Kutch Stock Exchange Ltd. [2008] 305 ITR 227 (SC). These cases emphasized that inordinate delays in pronouncement render the judgments vulnerable and bad in law. The tribunal's delay in pronouncing the order was thus argued to be a significant procedural lapse warranting recall.

3. Applicability of Rule 34(5) of ITAT Rules, 1963:
The tribunal acknowledged Rule 34(5) of the ITAT Rules, which mandates that orders should be pronounced within 60 days from the date of hearing, extendable by an additional 30 days under exceptional circumstances. The tribunal noted that no exceptional or extraordinary circumstances were cited to justify the delay in this case. The tribunal referenced its own decision in G. Shoe Exports v. ACIT, which reiterated the importance of adhering to the 90-day rule for pronouncements.

4. Jurisprudence on Delayed Pronouncements:
The tribunal extensively discussed the jurisprudence on delayed pronouncements. The Hon'ble Bombay High Court in Shivsagar Veg. Restaurant and Otters Club cases, and the Hon'ble Supreme Court in Madhav Hayawadar Rao Hoskot v. State of Maharashtra [1978] 3 SCC 544, emphasized that justice delayed is justice denied. The courts have consistently held that unexplained delays in pronouncement shake litigants' confidence in the judicial process and render judgments susceptible to being set aside.

Conclusion:
Respecting the jurisprudence and the binding nature of Rule 34(5), the tribunal concluded that the delay in pronouncement of the order beyond 90 days constituted a mistake apparent from the record. Consequently, the tribunal allowed the miscellaneous application, recalling the order dated 01.02.2016 in ITA No. 1994/Mum/2013 and directed the registry to place the appeal before the Regular Bench for fresh hearing. The decision underscores the critical importance of timely pronouncement of orders to uphold the integrity and efficiency of the judicial process.

Order Pronouncement:
The order was pronounced in the open court on 11.05.2018, allowing the miscellaneous application filed by the assessee.

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