2025 (3) TMI 1387 - HC - Income Tax

ITR u/s 139 to be treated as non-est or not - Review of order 2014 (5) TMI 596 - ALLAHABAD HIGH COURT - HELD THAT - In the facts of the case it has to be seen as to when the due date for filing return i.e. 31.10.2002 had lapsed but prior thereto account books and other material of the assessee were seized on 01.09.2002 and when the block assessment was being done whether it was at all necessary for the assessee to file a belated return after the seized material was released in favour of the assessee or if at all it was filed whether such filing could be fatal to his case or whether the assessee was precluded from filing return though inspection was facilitated to him. The interse connection between regular proceedings vis-a-vis block assessment proceedings in the peculiar facts of the case is a question that has relevance so as to adjudge the issue of double jeopardy allegedly faced by the assessee as argued on his behalf. Review petition - non answering the substantial question - whether a ground for review? - HELD THAT - Applicability of correct clause/sub-clause of any Section/sub-Section of Section 158-BB of the IT Act was not answered by this Court while deciding the appeal the same in itself cannot be a ground to review the order inasmuch as the point was left open by the Court to be decided in appeal after remand i.e. to say that the ingredients of the substantial question of law were to be re-determined by the Appellate Tribunal pursuant to the order of remand. Therefore when Shri Goyal submits that the Appellate Tribunal after remand has accepted the finding of this Court as regards the ITR under Section 139 being non-est and therefore the order passed by the Tribunal be also set aside on this ground alone we are of the view that the present review application and the connected appeal are to be decided in the light of scope of two different and independent proceedings i.e. one being an application for review and the other being a statutory appeal and hence we would do accordingly. Conclusion - We find that not only the block assessment order dated 30.09.2004 but also the assessment order 29.03.2006 and orders passed subsequently i.e. on 16.08.2005 and 26.06.2006 contained discussion of material that was available before the Authorities/Tribunal. Merely because this Court interpreted the record of proceedings in one way or the other we do not find that there is any error apparent on the face of the record so as to justify exercise of our review jurisdiction. At the same time the effect of order on the proceedings culminating into passing of the subsequent order after remand has to be seen while deciding the connected Income Tax Appeal 2025 (3) TMI 1287 - ALLAHABAD HIGH COURT but in any case we are of the considered view that the order 2014 (5) TMI 596 - ALLAHABAD HIGH COURT does not suffer from an error apparent on the face of the record so as to persuade this Court to review the order and take another view of the matter different from the one taken by this Court in its order dated 16.05.2014. Application for review stands rejected.

Summary

1. ISSUES PRESENTED and CONSIDERED

The primary issues considered in this judgment revolve around the review application filed by the assessee seeking to overturn the High Court's previous order dated 16.05.2014. The core legal questions include:

• Whether there was an error apparent on the face of the record in the High Court's previous judgment that justified a review.
• Whether the Income Tax Return (ITR) filed under Section 139 of the Income Tax Act was correctly deemed "non-est" by the High Court in its earlier judgment.
• Whether the non-answering of a substantial question of law by the High Court in its previous judgment could be a ground for review.
• The scope and applicability of review under Order XLVII Rule 1 of the Code of Civil Procedure, 1908.

2. ISSUE-WISE DETAILED ANALYSIS

Scope of Review under Order XLVII Rule 1 CPC

The legal framework for review is governed by Order XLVII Rule 1 of the Code of Civil Procedure, 1908, which allows for review on the discovery of new evidence, an error apparent on the face of the record, or any other sufficient reason. The Court emphasized that review is not an appeal in disguise and cannot be used to reargue or rehear the case. The Court cited several precedents, including S. Murali Sundaram vs. Jothibai Kannan and Pancham Lal Pandey vs. Neeraj Kumar Mishra, to reinforce that review is limited to correcting apparent errors and not substituting views.

Interpretation of "Non-Est" ITR

The Court analyzed whether the previous judgment's characterization of the ITR filed under Section 139 as "non-est" constituted an error. It concluded that the "non-est" observation was not the ratio decidendi of the earlier judgment but rather a passing remark or obiter dictum. Therefore, it did not warrant a review as it was not a decisive conclusion affecting the remand to the Appellate Tribunal.

Non-Answering of Substantial Question of Law

The Court considered whether the failure to answer the substantial question of law in the previous judgment could justify a review. It determined that the remand to the Appellate Tribunal left the question open for determination, and thus, the non-answering did not constitute an error apparent on the face of the record.

Application of Law to Facts

The Court applied the principles of review to the facts, noting that the assessment and block assessment orders contained sufficient material and discussion. The interpretation of these records by the previous judgment did not exhibit an error apparent on the face of the record.

3. SIGNIFICANT HOLDINGS

The Court reiterated the limited scope of review, emphasizing that:

• "Review proceedings are not by way of appeal and have to be strictly confined to the scope and ambit of Order 47 Rule 1 CPC."
• "Power of review may be exercised when some mistake or error apparent on the face of record is found."
• "Power of review may not be exercised on the ground that the decision was erroneous on merits."
• The observation of the ITR as "non-est" was not a binding conclusion but a passing remark, and thus, not grounds for review.
• The non-answering of the substantial question of law in the previous judgment was not an error apparent on the face of the record.

In conclusion, the Court found no error apparent on the face of the record in the previous judgment dated 16.05.2014 and rejected the review application. The judgment underscores the strict boundaries of the review process, emphasizing that it is not an opportunity to re-litigate or re-evaluate the merits of the case.