2016 (3) TMI 1380 - HC - Income Tax

Rectification u/s 254 - HELD THAT - AO did not furnish any details as indicated in the order of the Tribunal, rather it called for details from the Petitioners, and in turn, by letter dated 14th October 2009 the Petitioners pleaded ignorance of the Trust. The Rectification Application filed by the Petitioners sought to rectify the aforesaid error apparent on the face of the order. Impugned order does not deal with the aforesaid objection of the Petitioners and the order dated 31st October 2014 of the Tribunal passed under section 254(1) on the above issue. It is the Petitioners' case that there are such other glaring errors in the impugned order. However, looking at the entire controversy in the Petitions, it would be appropriate that the Petitions be disposed of finally at the stage of admission. This is particularly because the Petitions arise from an order rejecting the Rectification Application and admitting the Petition would unduly delay the proceedings. Parties are put to notice that the Petitions are fixed peremptorily on 12th April 2016 at 3.00 p.m. at which stage it may be disposed of finally

Summary

Issues:
Challenge to order of Income Tax Appellate Tribunal under section 254(2) of the Income Tax Act 1961 regarding rejection of Rectification Applications.

Analysis:
The judgment concerns the challenge to a common order dated 22nd June 2015 passed by the Income Tax Appellate Tribunal (Tribunal) under section 254(2) of the Income Tax Act 1961. The Petitioners had filed Rectification Applications seeking to rectify the order dated 31st October 2014 passed under section 254(1) of the Act, which were subsequently rejected. The court observed that the Petitioners had made an arguable case that the impugned order failed to address their submissions regarding the rectification of the earlier order. The Tribunal's order dated 31st October 2014, which rejected the Petitioners' grievance of breach of natural justice, was found to have inaccurately referred to a letter dated 23rd September 2009. Upon scrutiny, it was revealed that the Assessing Officer did not provide the details mentioned in the Tribunal's order but had actually sought such information from the Petitioners. The Rectification Application aimed to rectify this error apparent on the face of the order, but the impugned order did not address this issue or other alleged errors raised by the Petitioners. The court considered it appropriate to dispose of the Petitions finally at the stage of admission to prevent undue delay in the proceedings arising from the rejection of the Rectification Application.

Furthermore, the court scheduled a peremptory hearing on 12th April 2016 at 3.00 p.m. to finalize the matter. In the interim, ad-interim relief was granted in terms of the prayer clause. The judgment highlights the importance of addressing the Petitioners' contentions regarding the inaccuracies in the Tribunal's order and emphasizes the need for a prompt resolution to prevent unnecessary delays in the legal proceedings.