2012 (9) TMI 722 - AT - Income Tax

Misc application filed against ex parte and non-speaking order passed by Tribunal for non-prosecution - Held that - There is no dispute that the applicant had engaged a counsel and was, therefore, justified in presuming that the counsel would attend the case. However, due to certain mistake in noting the date of hearing in the diary maintained by the assessee s counsel, he could not attend on the date of hearing. In the absence of any contrary material placed on record by the Revenue, we are of the view that the lapse on the part of the assessee s counsel appears to be bonafide. It is also undisputed that Tribunal while dismissing the Misc. Application filed by the assessee has not passed any speaking order and has dismissed it on the ground for non-prosecution only. there was a reasonable cause, therefore, it is held that the mistake of the counsel was bonafide and the applicant cannot be made to suffer for the mistake of the assessee s counsel and accordingly the ex parte order for non-prosecution passed by the Tribunal is recalled - Decided in favor of assessee

Summary

Issues:
- Recall of order passed by the Tribunal due to non-appearance of counsel on the specified date.

Analysis:
The judgment pertains to a Misc. Application filed by the assessee against the order passed by the Tribunal in M.A. No. 319/Mum/2011 arising out of ITA No. 6376/M/2007 for A.Y. 2004-05. The application was filed due to the non-appearance of the assessee's counsel on the scheduled date, resulting in the dismissal of the application. The counsel's mistake in noting the date of the hearing in his diary led to the non-appearance. The assessee sought the recall of the order based on the bonafide mistake of the counsel. The Tribunal had dismissed the application for non-prosecution, citing lack of compliance by the assessee on the scheduled date. The assessee's counsel admitted the mistake and requested that the order be recalled to prevent financial loss and hardship to the applicant.

The Tribunal considered the submissions of both parties and noted that the counsel's mistake was bonafide, as there was no dispute that the applicant had engaged a counsel and was justified in assuming the counsel's attendance. The Tribunal referred to precedents such as Mahaveerprasad Jain v. CIT and Rafiq v. Munshilal to emphasize that the party should not suffer due to the negligence of the counsel. The Tribunal distinguished the present case from Shri Padam Prakash (HUF) where a subsequent Misc. Application was rejected, as in this case, the Tribunal had not passed a speaking order but dismissed the application for non-prosecution only. The Tribunal also cited cases like CIT vs. Khemraj Laxmichand and Subhkaran & Sons v. N.A. Kazi to support the condonation of delay in such situations.

Further, the Tribunal highlighted that decisions like CIT vs. Keshav Fruit Mart and others, where the Tribunal recalled its order under section 254(2), were not directly applicable as the present case involved a second Misc. Application under the same section. Considering the bonafide mistake of the counsel and the reasonable cause presented, the Tribunal recalled the ex parte order for non-prosecution and allowed the Misc. Application. The parties were directed to appear without waiting for any notice on a specified date. Ultimately, the Misc. Application filed by the assessee was allowed, and the order was recalled.

In conclusion, the judgment focused on the bonafide mistake of the counsel leading to non-appearance, the application of legal precedents emphasizing the party should not suffer for counsel's negligence, and the distinction made from previous cases to allow the recall of the order based on the specific circumstances of the present case.