2019 (7) TMI 1543 - AT - Income Tax

Rectification of mistake/recall of order - Doctrine of Merger - issue of both the cross appeals (assessee's as well as Department's) are one and the same - Valuation of House Property - pendency of Departmental Appeal - adoption of the value of property as per stamp duty value / actual consideration as per Section 50C for computation of capital gains - HELD THAT - In the instant case, the assessee and the revenue have filed cross appeals and there was a mistake committed on the part of the ITAT in not clubbing the appeals. Therefore, the ITAT disposed off the assessee s appeal without hearing the departmental appeal. Neither the Ld.AR nor the Ld.DR brought to the notice of the ITAT, with regard to the pendency of the departmental appeal. Therefore, there is error in the order passed by the ITAT. When the cross appeals are filed by both the department and the assessee, required to be clubbed and heard together. Disposal of assessee s appeal without hearing the departmental appeal cause injury and injustice to the department. Therefore, there was a mistake in the order of the Tribunal, hence, the assessee s appeal required to be recalled. The order passed by this Tribunal in the case of the assessee is recalled - the cases for hearing fixed on 22.08.2019 - application of Revenue allowed.

Summary

Issues Involved:
Appeal against the order of the Commissioner of Income Tax (Appeals) regarding the adoption of property value for computation of capital gains.

Analysis:
The judgment involves a situation where both the department and the assessee filed appeals against the order of the Commissioner of Income Tax (Appeals) for the Assessment Year 2010-11. The issue in both appeals revolved around the adoption of the property value as per stamp duty value or actual consideration for the computation of capital gains under Section 50C. Initially, the assessee's appeal was heard and disposed of without considering the departmental appeal, leading to a mistake in not clubbing both appeals together. The department later filed a Miscellaneous Application requesting the ITAT to recall the order of the assessee and decide both appeals collectively.

The Ld.DR representing the revenue argued that due to oversight, the departmental appeal was not brought to the attention of the ITAT during the assessee's appeal hearing. As the issues in both appeals were common, it was requested to recall the order of the assessee's appeal and decide both appeals together on merits. On the other hand, the Ld.AR representing the assessee opposed the recall, stating that there was no error in the ITAT's order.

Upon hearing both parties and examining the records, the ITAT acknowledged the mistake in not clubbing the cross appeals of the department and the assessee. The failure to hear the departmental appeal alongside the assessee's appeal was deemed erroneous and unjust, causing injury to the department. Citing the Hon'ble Supreme Court's decision in a similar case, the ITAT decided to recall the order of the assessee and schedule a joint hearing for both appeals to ensure justice and avoid further complications. Consequently, the Miscellaneous Application filed by the revenue was allowed, and the appeals were directed to be reheard together on a specified date without the need for separate notices to the parties.

In conclusion, the judgment highlights the importance of ensuring both departmental and assessee appeals are heard together when the issues are interconnected, emphasizing the principle that no party should suffer due to court or tribunal mistakes. The decision to recall the order and rehear both appeals jointly aims to uphold fairness and prevent any prejudice resulting from procedural errors.