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TMI Blog2024 (5) TMI 224X X X X Extracts X X X X X X X X Extracts X X X X ..... t on the record which ought to have been considered by the Tribunal when it is pointed out being a mistake apparent on record. As decided in Air Conditioning Specialities (P.) Ltd [ 1995 (3) TMI 14 - GUJARAT HIGH COURT] as held no doubt in our minds that when a point is concluded by a decision of this court, all subordinate courts and inferior Tribunal within the territory of this State and subject to the supervisory jurisdiction of this court are bound by it and must scrupulously follow the said decision in letter and spirit. Since the second respondent has not decided the matter in accordance with law laid down by this court in the case of Bharat Textile Works [ 1978 (2) TMI 72 - GUJARAT HIGH COURT] the order passed by him requires to be quashed and set aside. In such circumstances, not following the binding decision is mistake apparent on record. The impugned orders are accordingly quashed and set aside. The matter is remanded back to the Tribunal to pass fresh orders in Misc. Application preferred by the petitioner. X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A) with respect to interest income from staff loans and advances, fix deposits and advances to others amounting to Rs. 2,91,78,000/- as income from other sources as against the business income. The appeal was fixed for hearing before the Tribunal on 30.06.2022 and a chart was provided on behalf of the petitioner along with compilation of the judgements running into 117 pages. Reliance was placed also on the judgement dated 16.03.2020 passed by this Court in Tax Appeal No. 63/2020 in case of Gujarat Urja Vikas Nigam Ltd vs. DCIT to demonstrate that this Court confirmed the order passed by the Tribunal in case of the said assessee wherein it was held that interest income from staff loan and advances is income from business or profession and not income from other source. It was also pointed out that the said judgement was followed by the Tribunal in case of Gujarat Energy Transmission Corporation Ltd in ITA No. 3441/Ahd/2015 by remanding the issue back to the Assessing Officer for deciding the same in accordance with the direction by this Court. 5.3 It is the case of the petitioner that in spite of pointing out such facts, the Tribunal passed a consolidated order dated 24.08.2022 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sdictional High Court rendered on the identical facts would be a mistake apparent on record. Reliance was placed on the decision of this Court in case of Dattani & Co. vs. Income Tax Officer reported in 2014 14 Taxmann.com 360 to submit that the impugned order passed by the Tribunal is required to be quashed and set aside by remanding the matter back to the Tribunal to pass appropriate order in the Misc. Application preferred by the petitioner. 7. On the other hand, learned Senior Standing Counsel Mr. Nikunt Raval for learned advocate Ms. Kalpana Raval submitted that the Tribunal has held in no uncertain terms that in the order dated 24.08.2022 there is no mistake apparent on record as the Tribunal has given detailed findings in Paragraph No. 10 of the said order and as such, the petitioners were seeking a review of the order which is not permissible under section 254(2) of the Act. It was submitted that the Tribunal has taken cognizance of the decision of the Orissa High Court and given its view on the aspect of interest on staff loan as to whether it is business income or not which is an independent view after considering the decision of this Court, Orissa High Court and the Del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rectifying any mistake apparent from the record, amend any order passed by it under sub-section (1), and shall make such amendment if the mistake is brought to its notice by the assessee or the [Assessing Officer]: Provided that an amendment which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this sub-section unless the Appellate Tribunal has given notice to the assessee of its intention to do so and has allowed the assessee a reasonable opportunity of being heard: [Provided further that any application filed by the assessee in this sub-section on or after the 1st day of October, 1998, shall be accompanied by a fee of fifty rupees." 11. The Tribunal has held in the impugned order dated 24.08.2022 as under: "8. As regard to Ground No. 2 relating to treating interest income from staff loans and advances and other miscellaneous receipt from income from other sources and not as income from business and profession the Ld. AR submitted that in respect of interest income from staff loans and advances, the Hon'ble Orissa High Court in case of Odisha Power Generation Corporation Ltd vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income. Thus, the disallowances to that extent is just and proper on part of the Assessing Officer and CIT(A). Thus, Ground No. 2 is dismissed." 12. From the above observation of the Tribunal it is clear that though the Tribunal has referred to the decision of the Coordinate Bench as well as the binding decision of this Court which is a Jurisdictional High Court and has relied upon the decision of the Hon'ble Orissa High Court on the ground that as per the view of the Tribunal, the interest earned on the staff loan and advances incidental to the assessee's business is factually incorrect as the loan advances given to the employees are not mandatory incentive given to the staff and cannot be termed as incidental to the business. The Tribunal could not have taken different view than what was already taken by the Coordinate Bench which is confirmed by this Court in Tax Appeal No. 63/2020. Thus, there is a mistake apparent on the face of the record in the order dated 24.08.2022 passed by the Tribunal which ought to have been considered by the Tribunal and the Misc. Application preferred by the petitioner could not have been dismissed by observing as under: "4. We have heard both t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion were different from the members who decided the case on the present occasion. But what is relevant is not the personality of the officers presiding over the Tribunal or participating in the hearing but the Tribunal as an institution. If it is to be conceded that simply because of the change in the personnel of the officers who manned the Tribunal, it is open to the new officers to come to a conclusion totally contradictory to the conclusion which had been reached by the earlier officers manning the same Tribunal on the same set of facts, it will not only shake the confidence of the public in judicial procedure as such, but it will also totally destroy such confidence. The result of this will be conclusions based on arbitrariness and whims and fancies of the individuals presiding over the courts or the tribunals and not reached objectively on the basis of the facts placed before the authorities. If a Bench of a Tribunal on the identical facts is allowed to come to a conclusion directly opposed to the conclusion reached by another Bench of the Tribunal on an earlier occasion, that will be destructive of the institutional integrity itself. That is the reason why in a High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing in the Supreme Court. It cannot be disputed and is not disputed that the second respondent is a "Tribunal" subject to the supervisory jurisdiction of this court under article 227 of the Constitution. Hence, he is bound to obey the law declared by this court. The apex court of the country in no uncertain terms held that the law declared by a High Court is binding on all subordinate courts and Tribunals within the territory to which it exercises the jurisdiction. In Bhopal Sugar Industries Ltd. v. ITO [1960] 40 ITR 618 (SC), the Income-tax Officer (subordinate authority) refused to carry out clear and unambiguous directions of the Income-tax Appellate Tribunal (superior authority). Deprecating it, their Lordships of the Supreme Court observed (page 622): "Such refusal is in effect a denial of justice, and is furthermore destructive of one of the basic principles in the administration of justice based as it is in this country on a hierarchy of courts. If a subordinate Tribunal refuses to carry out directions given to it by a superior Tribunal in the exercise of its appellate powers, the result will be chaos in the administration of justice...." A direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ority, including in appropriate cases any Government, within its territorial jurisdiction. Under article 227 it has jurisdiction over all courts and Tribunals throughout the territories in relation to which it exercises jurisdiction. It would be anomalous to suggest that a Tribunal over which the High Court has superintendence can ignore the law declared by that court and start proceedings in direct violation of it. If a Tribunal can do so, all the subordinate courts can equally do so, for there is no specific provision, just like in the case of the Supreme Court, making the law declared by the High Court binding on subordinate courts. It is implicit in the power of supervision conferred on a superior Tribunal that all the Tribunals subject to its supervision should conform to the law laid down by it. Such obedience would also be conducive to their smooth working ; otherwise, there would be confusion in the administration of law and respect for law would irretrievably suffer. We, therefore, hold that the law declared by the highest court in the State is binding on authorities or Tribunals under its superintendence, and that they cannot ignore it either in initiating a proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... archical system of courts that there are decisions of the supreme appellate tribunal which do not attract the unanimous approval of all members of the judiciary. When I sat in the Court of Appeal sometimes thought the House of Lords was wrong in overruling me. Even since that time there have been occasions, of which the instant appeal itself is one, when, alone or in company, I have dissented from a decision of the majority of this House. But the judicial system only works if someone is allowed to have the last word and if that last word, once spoken, is loyally accepted." We are very clear and we have no doubt in our minds that when a point is concluded by a decision of this court, all subordinate courts and inferior Tribunal within the territory of this State and subject to the supervisory jurisdiction of this court are bound by it and must scrupulously follow the said decision in letter and spirit. Since the second respondent has not decided the matter in accordance with law laid down by this court in the case of Bharat Textile Works [1978] 114 ITR 28, the order passed by him requires to be quashed and set aside." 15. IN view of the above conspectus of law, the decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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