2013 (1) TMI 513 - HC - Income Tax

Maintainability of the revision application - application to condone delay of 2 years 10 months and 8 days - Held that - As per Section 264(4)Clause(c) where an order has been made the subject of an appeal the Commissioner shall not revise the order. In the light of binding precedent of case of Mela Ram And Sons Versus CIT Punjab 1956 (2) TMI 5 - SUPREME COURT there is no escape from the conclusion that the order dated 28.03.2007 i.e. dismissing application for condonation of delay of 2 years 10 months and 8 days is an order in the appeal filed by the petitioner. Thus once it is so held as a necessary consequence it must be hold that the petitioner has not waived his appellate right to maintain an application for revision under Section 264. If that be so the finding of the revisional authority that in view of Section 264(4) the revision filed by the petitioner was not maintainable has to be upheld - writ petition fails.

Summary

Issues:
1. Appeal against the order of assessment with a delay of 2 years, 10 months, and 8 days.
2. Revision filed under Section 264 of the Income Tax Act with a delay of 4 years, 9 months, and 29 days.
3. Maintainability of the revision under Section 264(4) of the Income Tax Act.
4. Interpretation of Clause(c) of Section 264(4) regarding the appeal being made the subject of an appeal to the Commissioner (Appeals).
5. Whether the order dismissing the appeal without condoning delay is considered an order in the appeal.

Analysis:
The petitioner, an assessee under the Income Tax Act, filed an appeal against the assessment order for the year 2000-2001 with a delay of 2 years, 10 months, and 8 days. The appellate authority declined to condone the delay and dismissed the appeal. Subsequently, the petitioner filed a revision under Section 264 of the Income Tax Act with a delay of 4 years, 9 months, and 29 days, challenging the rejection of the revision by the revisional authority. The revisional authority considered the maintainability of the revision, the request for condonation of delay, and the merits of the revision, deciding against the petitioner on all grounds. The petitioner then filed a writ petition challenging this order.

The High Court analyzed the maintainability of the revision under Section 264(4) of the Income Tax Act. Section 264(4) outlines cases where the Commissioner shall not revise any order, including when an appeal lies but has not been made or the order is pending on appeal. The court focused on Clause(c) of Section 264(4), which states that the Commissioner shall not revise an order that has been made the subject of an appeal. The petitioner's appeal to the Commissioner (Appeals) with a request to condone delay was dismissed, leading to the question of whether this dismissal constitutes an order in the appeal.

Referring to the judgment in Mela Ram's case, the court considered whether an appeal dismissed without condoning delay is still considered an order in the appeal. The Apex Court held that an appeal presented out of time is still an appeal, and an order dismissing it as time-barred is considered an order in the appeal. Therefore, the court concluded that the order dismissing the petitioner's appeal without condoning the delay is indeed an order in the appeal. Consequently, the petitioner had not waived their appellate right, making the revision under Section 264 of the Act not maintainable. As a result, the court dismissed the writ petition, upholding the revisional authority's decision and emphasizing the binding precedent set by the Apex Court in interpreting such situations.