2022 (5) TMI 1548 - AT - Income Tax

Rectification of mistake u/s 254 - period of limitation - Tribunal had disposed of the appeal ex-parte on merits and dismissed the appeal filed by the assessee - Miscellaneous Application was filed after so many days (approx more than 3 years and 11 months from receipt of the order of the Tribunal) - whether the amended provisions of section 254(2) w.e.f. 01.06.2016 shall apply to the facts of the present case or not? HELD THAT - Undoubtedly the present Miscellaneous Application was filed by the assessee within the period of 4 years from the receipt of the order of the Tribunal. Therefore applying the ratio of DISTRICT CENTRAL CO-OP. BANK LTD. VERSUS UNION OF INDIA 2017 (10) TMI 691 - MADHYA PRADESH HIGH COURT it cannot be said that the Miscellaneous Application is barred by limitation. Accordingly we admit the Miscellaneous Application for adjudication. We find that the Tribunal passed the order dismissing the appeal of the assessee in the absence of the appellant-assessee. Now the appellant has filed an application in the form of an affidavit before us stating that it could not cause the appearance when the appeal was called owing to the ill health conditions of the appellant etc. The averments made in the affidavit were not controverted by the Department. Therefore we are satisfied that the appellant is prevented from causing appearance before the Tribunal by sufficient and reasonable cause and therefore it is fit case for recall the matter under rule 25 of the Income Tax Appellate Tribunal Rules 1963. Accordingly we recall this appeal for denovo hearing and direct the Registry to post the appeal for hearing in due course. Thus the Miscellaneous Application filed by the appellant stands allowed.

Summary

Issues:
1. Application for recall of the order passed by the Tribunal
2. Applicability of amended provisions of section 254(2) of the Income Tax Act, 1961
3. Dismissal of the appeal in the absence of the appellant
4. Consideration of sufficient and reasonable cause for recall under rule 25 of the Income Tax Appellate Tribunal Rules, 1963

Detailed Analysis:
1. The appellant filed a Miscellaneous Application seeking the recall of the order passed by the Tribunal in ITA No.943/PUN/2012 for the assessment year 2005-06. The Tribunal had disposed of the appeal ex-parte on merits and dismissed the appeal. The application was filed after approximately more than 3 years and 11 months from the receipt of the Tribunal's order, raising the question of whether the amended provisions of section 254(2) of the Income Tax Act, 1961 would apply. Citing a decision of the Hon’ble Madhya Pradesh High Court, it was held that the new law of limitation providing a shorter period should be applicable only to orders passed by the Tribunal from 01.06.2016. As the application was filed within 4 years from the receipt of the order, it was not barred by limitation, and hence, the Miscellaneous Application was admitted for adjudication.

2. The Tribunal had initially dismissed the appeal of the appellant in their absence. Subsequently, the appellant filed an affidavit stating that they could not appear due to ill health conditions. The Department did not contest the averments made in the affidavit. Considering the sufficient and reasonable cause presented by the appellant, the Tribunal found it appropriate to recall the matter under rule 25 of the Income Tax Appellate Tribunal Rules, 1963. Therefore, the appeal was recalled for denovo hearing, and the Registry was directed to schedule the appeal for hearing accordingly. The Miscellaneous Application filed by the appellant was allowed, and the appeal was to be reheard.

3. In conclusion, the Tribunal allowed the Miscellaneous Application filed by the appellant, leading to the recall of the appeal for denovo hearing. The decision was pronounced on the 11th day of May, 2022. The Tribunal's decision was based on the application of legal principles regarding the applicability of amended provisions, the consideration of sufficient cause for recall, and the procedural rules governing such applications before the Tribunal.