1977 (11) TMI 73 - AT - Income Tax

Summary

Issues:
1. Recall of Tribunal's order based on a judgment being overruled by a subsequent decision.
2. Interpretation of the word "issue" in the context of serving notices under the Income-tax Act.
3. Application of precedent and binding judgments in tax matters.

Analysis:

1. The case involved a miscellaneous application filed by the Senior Authorised Representative seeking the recall of the Tribunal's order in ITA No. 819 of 1975-76. The application was based on the contention that the Tribunal's judgment relied on a previous decision that had been overruled by a subsequent judgment of the Punjab and Haryana High Court in the case of Jai Hanuman Trading Co. (P) Ltd. The application argued that the Tribunal's order should be reconsidered in light of the new judgment.

2. The Tribunal outlined the facts of the case, including the issuance of notices under section 148 of the Income-tax Act, 1961 to the assessee for the assessment year 1961-62. The assessee had challenged the order passed under section 144 of the Act and the notice issued by the Income Tax Officer (ITO). The Punjab and Haryana High Court had previously held that the words "issue" and "serve" are interchangeable in the context of serving notices under the Act.

3. During the proceedings, the Revenue contended that the judgment in the assessee's case had been reversed by the Jai Hanuman Trading Co. (P) Ltd. case, and therefore, the Tribunal's order should be recalled under section 254(2) of the Act. However, the respondent argued that the Supreme Court's decision in CWT vs. Kundan Lal Behari Lal clarified that the word "issue" in the Wealth Tax Act should be construed as "served," and this interpretation should apply to the Income-tax Act as well. Additionally, reference was made to the Gujarat High Court judgment in Karam Chand Prem Chand (P) Ltd. vs. CIT to support the argument that the Supreme Court's decision should prevail as per Article 141 of the Constitution of India.

4. The Tribunal, after considering the arguments presented, held that the Revenue's miscellaneous application was misconceived. It emphasized that the Supreme Court's decision in the Kundan Lal Behari Lal case established that the word "issue" should be interpreted as "serve." Furthermore, the Tribunal affirmed that the judgment in the assessee's case was binding, while the decision in Jai Hanuman Trading Co. (P) Ltd.'s case would only serve as a precedent.

5. Ultimately, the Tribunal dismissed the Revenue's miscellaneous application, upholding the original order and rejecting the request for recall based on the subsequent judgment.