9911796707
TMI Blog2011 (9) TMI 159X X X X Extracts X X X X X X X X Extracts X X X X ..... after be referred to as `the Act') on 26th March 2007. In the said order the Settlement Commission charged interest from the petitioner u/Sec.234B and 234C of the Act upto the date of the order u/Sec.245D(4) of the Act. Settlement Commission noted that such interest was being charged as per the decisions of the Apex Court in the case of M/s. Hindustan Bulk Carriers (259 ITR 449), Damani Brothers (254 ITR 91) and Anjuman Mohammed Hussein Ghaswala and others (252 ITR 1). 3. Respondent no.2, i.e. the Income Tax Officer while giving effect to the order or the Settlement Commission, therefore, charged interest on the petitioner u/Sec.234B and 234C upto the date of the order passed u/Sec.245D(4) of the Act. 4. It is not in dispute that the petitioner did not challenge the order of the Settlement Commission or any part thereof. In other words, the petitioner accepted the order of the Settlement Commission including the portion of the order whereby the Settlement Commission charged interest from the petitioner upto the date of the order u/Sec.245D(4) of the Act. The Assessing Officer also levied such interest from the petitioner while giving effect to the order of the Settl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Apex Court in case of Brijlal and others (supra) the petitioner could not have approached this Court after several years and thereby revive a cause which was either abandoned or had not survived. Counsel for the petitioner had thereupon taken time to cite judicial decisions with respect to this aspect of the matter. Before adverting to the contentions raised by the counsel for the petitioner and the authorities cited, we may notice that the petition is filed in September 2011 challenging the order of the Settlement Commission passed on 26th March 2007. Thus, after a period of well over four years a portion of the order of the Settlement Commission is challenged in a writ petition. In the petition, to explain such delay all that the petitioner has stated is that recently the Larger Bench of the Apex Court comprising of five Hon'ble Judges has in case of Brijlal and others (supra) held that interest u/Sec.234B and 234C of the Act is to be charged only upto the date of the order of the Settlement Commission u/Sec.245D(1) and not upto the date of order u/Sec.245D(4) of the Act. It is the further case of the petitioner that in the same decision it is held that such order of the Settl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. 13. Reliance was placed on the decision of Bombay High Court in the case of Walchand Nagar Industries Ltd. v. V.S. Gaitonde, Income-Tax Officer, Companies Circle I(3), Bombay and another (44 ITR 260). It was a case wherein by virtue of subsequent decision certain levy of dividend tax was held to be invalid. The Bombay High Court held that by virtue of such decision even though subsequently rendered, the order of the Assessing Officer levying tax would be rendered bad at its inception and the Income-Tax authorities, therefore, were in error in not rectifying the mistake. In other words, the Court was of the opinion that by virtue of the subsequent decision of the Apex Court, the assessee was entitled to seek rectification of the order of the Assessing Officer. We may notice that the decision was specifically with respect to right of an assessee to seek rectification of a completed assessment order by virtue of a subsequent decision of the Apex Court. 14. Reliance was placed on the decision in the case of Poothundu Plantations Pvt. Ltd. v. Agricultural Income-Tax Officer and others (221 ITR 557) wherein the Apex Court observed as under:- "It is well settle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt was of the opinion that the writ petition can be entertained even if alternate remedy was available on certain limited grounds. We are, however, not concerned with such an issue in these writ petitions. 20. Reliance was also placed on the decision of the Apex Court in the case of Nani Gopal Paul v. T. Prasad Singh and others reported in AIR 1995 SC 1971 wherein the Apex Court in a suo motu action set aside the auction sale of a hypothecated property conducted by the Court Receiver finding that there were illegalities pointed by the Division Bench of the High Court in such sale. Once again, we are not directly concerned with such issue in the present cases. 21. Reliance was also placed on the decision in the case of Chandabai Daga v. Income-Tax Appellate Tribunal and another (194 ITR 422) wherein the Bombay High Court entertained the writ petition of an assessee for refund of tax collected by the Union of India when it was found that another assessee had succeeded on the same legal issue before the High Court. The Court was of the opinion in a case where the monies had been realised without authority same must be refunded in an application under Article 226 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ettled only recently by the decision of the Apex Court in the case of Brijlal and others (supra). The petitioner having recently come to know about the same and having been advised to file the petition, such petition is filed. 27. We are of the opinion that even on the basis of such subsequent decision of the Apex Court, writ jurisdiction cannot be invoked after indefinite period of time. The Settlement Commission passed the order on the basis of its understanding of the law prevailing at the relevant time. Admittedly, the petition did not challenge such order. The question, therefore, is can the petitioner go to a court of law at any point of time without any reference to the passage of time and invoke writ jurisdiction on the basis of the decision of the Apex Court subsequently rendered. 28. We may notice the legal trend emerging from the decisions of the Apex Court. 29. In the case of Banda Development Authority, Banda v. Moti Lal Agarwal and others reported in (2011) 5 SCC 394 the Apex Court observed as under: "17. It is true that no limitation has been prescribed for filing a petition under Article 226 of the Constitution but one of the several rules of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t representations would not be adequate explanation to take care of the delay." 31. In the case of State of Orissa and Another reported in (2011) 3 SCC 436 the Apex Court observed that: "34. This Court has consistently rejected the contention that a petition should be considered ignoring the delay and laches in case the petitioner approaches the Court after coming to know of the relief granted by the Court in a similar case as the same cannot furnish a proper explanation for delay and laches. A litigant cannot wake up from deep slumber and claim impetus from the judgment in cases where some diligent person had approached the Court within a reasonable time. (See: M/s Rup Diamonds v. Union of India, State of Karnataka v. S.M. Kotrayya and Jagdish Lal v. State of Haryana." 32. In the case of bhakra Beas Management Board v. Krishan Kumar Vij and another reported in (2010) 8 SCC 701 the Apex Court observed that: "37. Yet, another question that draws our attention is with regard to delay and laches. In fact, respondent no.1's petition deserved to be dismissed only on that ground but surprisingly the High Court overlooked that aspect of the matter and dealt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the respondents-petitioners in these appeals (C.A. Nos. 861 to 867 of 1962) Mr. Andley has argued that the delay in these cases even is not such as would justify refusal of the order for refund. He argued that assuming that the remedy of recovery by action in a civil court stood barred on the date these applications were made that would be no reason to refuse relief under Art. 226 of the Constitution. Learned counsel is right in his submission that the provisions of the Limitation Act do not as such apply to the granting of relief under Art. 226. It appears to us however that the maximum period fixed by the legislature as the time within which the relief by a suit in a civil court must be brought may ordinarily be taken to be a reasonable standard by which delay in seeking remedy under Art. 226 can be measured. The Court may consider the delay unreasonable even if it is less than the period of limitation prescribed for a civil action for the remedy. but where the delay is more than this period, it will almost always be proper for the court to hold that it is unreasonable. The period of limitation prescribed for recovery of money paid by mistake under the Limitation Act is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 84 in about three months from the Redemption Certificate dated 9.3.1984." 36. The Swadeshi Cotton Mills Co. Ltd. v. The Government of U.P. And others reported in (1975) 4 SCC 378 was a case wherein the assessee had filed writ petition in the year 1956 challenging the validity of an assessment made in the year 1949 and prayed for refund of tax collected. For the delay, the petitioner gave the explanation that it came to know about the correct legal position after the decision in the case of Modi Food Products Ltd. reported in (1955) 6 STC 287. The Apex Court observed as under:- "3. We do not think that in this case it is necessary for us to consider whether Article 226 can be used for challenging the validity of the orders passed prior to January 26, 1950. But we are in agreement with the High Court on the other two grounds. As mentioned earlier, the impugned assessments were made in 1949. The writ petition was filed in 1956. The explanation given by the petitioner for this long delay is that he did not know the correct legal position and he came to know about the same after the decision of the Allahabad High Court in the Commissioner of Sales Tax, U.P. v. Modi Food ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of Article 141 of the Constitution, the view of the Supreme Court would be binding on all subordinate courts as also the Delhi High Court. It was a case wherein the appellant before the Apex Court had kept the issue alive and agitated the same before the Apex Court. It was in this background that the above observations were made. 40. The issue that the person in taking recourse to legal remedies cannot take advantage of a decision in the case of others was conclusively propounded by the Apex Court in a five Judge Bench in the case of Mafatlal Industries Ltd. And others v. Union of India and others reported in (1997) 5 SCC 536. The Apex Court following the decision in the case of M/s. Tilokchand Motichand and others (supra) held and observed as under:- "79. We may now consider a situation where a manufacturer pays a duty unquestioningly - or he questions the levy but fails before the original authority and keeps quiet. It may also be a case where he files an appeal, the appeal goes against him and he keeps quiet. It may also be a case where he files a second appeal/revision, fails and then keeps quiet. The orders in any of the situations have become final against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny claim for its refund be entertained. But what is happening now is that the duty which has been paid under a proceeding which has become final long ago - may be an year back, ten years back or even twenty or more years back - is sought to be recovered on the ground of alleged discovery of mistake of law on the basis of a decision of a High Court or the Supreme Court. It is necessary to point out in this behalf that for filing an appeal or for adopting a remedy provided by the Act, the limitation generally prescribed is about three months (little more or less does not matter). But according to the present practice, writs and suits are being filed after lapse of a long number of years and the rule of limitation applicable in that behalf is said to be three years from the date of discovery of mistake of law. The incongruity of the situation needs no emphasis. And all this because another manufacturer or assessee has obtained a decision favourable to him. What has indeed been happening all these years is that just because one or a few of the assessees succeed in having their interpretation or contention accepted by a High Court or the Supreme Court, all the manufacturers/assessees al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order of assessment falls within the jurisdiction of the authorities under the Act and no part of it can be said to constitute a collateral activity not specifically or expressly included in the jurisdiction of the authorities under the Act and no part of it can be said to constitute a collateral activity not specifically or expressly included in the jurisdiction of the authorities under the Act. It was clarified that even if the authority under the Act holds erroneously, while exercising its jurisdiction and powers under the Act that a transaction is taxable, it cannot be said that the decision of the authority is without jurisdiction. We respectfully agree with the above propositions and hold that the said principles apply with equal force in the case of both the Central Excises and Salt Act and the Customs Act. Once this is so, it is ununderstandable how an assessment/adjudication made under the Act levying or affirming the duty can be ignored because some years later another view of law is taken by another court in another person's case. Nor is there any provision in the Act for reopening the concluded proceedings on the aforesaid basis. We must reiterate that the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of another person. He cannot also claim that the decision of the court/tribunal in another person's case has led him to discover the mistake of law under which he has paid the tax nor can he claim that he is entitled to prefer a writ petition or to institute a suit within three years of such alleged discovery of mistake of law. A person, whether a manufacturer or importer, must fight his own battle and must succeed or fail in such proceedings. Once the assessment or levy has become final in his case, he cannot seek to reopen it nor can he claim refund without reopening such assessment/order on the ground of a decision in another person's case. Any proposition to the contrary not only results in substantial prejudice to public interest but is offensive to several well-established principles of law. It also leads to grave public mischief. Section 72 of the Contract Act, or for that matter Section 17(1)(c) of the Limitation Act, 1963, has no application to such a claim for refund." 41. From the above analysis of various judicial pronouncements it clearly emerges that though there is no fixed or rigid time limit for approaching a court for a writ under Article 226 of the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat while Mohd. Ramzan Khan's case (AIR 1991 SC 471) (supra) made the law laid down there prospective in operation, while disposing of the cases which were before the Court, the Court through inadvertence gave relief to the employees concerned in those cases by allowing their appeals and setting aside the disciplinary proceedings. The relief granted was obviously per incuriam. The said relief has, therefore, to be confined only to the employees concerned in those appeals. The law which is expressly made prospective in operation there cannot be applied retrospectively on account of the said error. It is now well settled that the courts can make the law laid down by them prospective in operation to prevent unsettlement of the settled positions, to prevent administrative chaos and to meet the ends of justice. In this connection, we may refer to some well-known decisions on the point. "..... It will, therefore, have to be held that notwithstanding the decision of the Central Administrative Tribunal in Premnath K. Sharma's case (1988 (2) ASLJ 449) (supra) and of the Gujarat High Court in H. G. Patel's case (1985 (2) 26 Guj LR 1385) (supra) and of the other courts and tribunals, ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
