High Court Of Punjab & Haryana
Paras Cold Storage & Ice Factory vs. CIT & ANR.
Section 260A, CPC O. 23, r. 1(3), CPC O. 23, r. 1 (4)
N.K. Sud & S.S. Grewal, JJ.
IT Appeal No. 151 of 2003
18th May, 2004
Counsel Appeared
O.P. Goyal with Balkar Singh, for the Appellant
JUDGMENT
N.K. Sud, J. :
The assessee has filed this appeal under s. 260A of the IT Act, 1961 (for short “the Act”), against the orders of the Income-tax Appellate Tribunal, Chandigarh Bench (for short “the Tribunal”), dt. 29th Oct., 1999, disposing of the appeal filed by the assessee and dt. 8th Aug., 2002, rejecting its application under s. 254(2) of the Act for recall of its order dt. 29th Oct., 1999.
2. We have our doubts about the maintainability of a consolidated appeal against two orders of the Tribunal. However, in view of the factual position in this case, it is not necessary for us to go into that question. It is an admitted position that the assessee had earlier preferred an appeal under s. 260A of the Act, before this Court against the order of the Tribunal dt. 29th Oct., 1999, which was numbered as IT Appeal No. 28 of 2000. The said appeal was disposed of vide order dt. 3rd Aug., 2001, as under : “Mr. Mittal states that the appellant has filed an application for rectification of the order dt. 29th Oct., 1999, before the Tribunal. This application, according to counsel, has been filed under s. 254 (2) of the IT Act, 1961. In view of the pendency of the application for rectification, counsel does not want to press this appeal and wants to pursue the petition pending before the Tribunal.
Mr. Sawhney, appearing for the Revenue, has no objection to the withdrawal of the appeal. Allowed as prayed for. Dismissed as withdrawn. No costs.” A perusal of the above shows that the assessee did not press the said appeal and had withdrawn it to pursue its application under s. 254(2) of the Act. No liberty was sought nor granted to the assessee to file a fresh appeal against the same order.
Counsel for the appellant was asked to explain as to how, in the absence of any liberty granted to the appellant by this Court to file a fresh appeal against the order dt. 29th Oct., 1999, a second appeal against the same was maintainable. Learned counsel placed reliance on the judgment of the Supreme Court in A.P. State Financial Corporation vs. C.M. Ashok Raju (1994) 4 SLR 442, to justify the maintainability of the present appeal. In our view, the judgment of the Supreme Court does not support the case of the assessee. To appreciate the distinction, we may reproduce paras 3 and 4 of the judgment, which read as under : “4. Promotions made to the posts of manager and above by the orders dt. 7th Jan., 1988, and 1st Feb., 1988, were challenged by way of writ petitions before the Andhra Pradesh High Court by those who were not selected. A learned single Judge of the High Court came to the conclusion that the allotment of 50 per cent marks to performance appraisal under the new promotion policy was on the higher side, assigning 15 per cent marks for seniority to a person who has served for five years and above, was palpably low and allocating 25 per cent marks for the interview was on the higher side. On these findings, the learned single Judge allowed the writ petitions and quashed the selection and the appointments made by the Board. Writ appeals filed by the corporation were heard by a Division Bench of the High Court and Lakshmana Rao, J., speaking for the Bench, upheld the findings of the learned single Judge to the effect that 25 per cent marks for interview were excessive. The Bench, however, did not agree with the learned single Judge that 50 per cent marks for performance appraisal were excessive. The Division Bench reduced the interview marks from 25 per cent to 15 per cent and increased the marks, regarding length of service above 5 years, from 15 per cent to 25 per cent. With these modifications, the Division Bench dismissed the writ appeals. The corporation filed special leave petitions against the judgment of the Division Bench which were rejected by this Court on 4th Oct., 1991, by the following order : ‘The special leave petitions are rejected as withdrawn with liberty to the petitioner to approach the High Court, if it is so advised, to point out the case which has since been pleaded before us.’ Thereafter, the corporation, in terms of the liberty granted by this Court, approached the High Court by way of miscellaneous petitions requesting the High Court to consider the matter afresh in the light of various points raised in the petitions. The High Court by the order dt. 24th April, 1992, dismissed the petitions. These appeals by way of special leave are against the judgment of the Division Bench of the High Court in the writ appeals, order dismissing the review petitions and the order dismissing the petitions which were filed in terms of the liberty granted by this Court.
Learned counsel for the contesting respondents have strenuously contended that the Special Leave Petitions against the judgment of the Division Bench of the High Court in writ appeals, having been rejected by this Court, the High Court judgment has achieved finality and, as such, these appeals are liable to be dismissed on that short ground. We do not agree with learned counsel. This Court while rejecting the petitions as withdrawn, granted liberty to the petitioner to approach the High Court and point out the case which was sought to be pleaded before this Court. In other words, this Court prima facie found the contentions of the petitioner to be plausible and, as such, granted liberty to raise the same before the High Court. The High Court heard the parties at length and passed a reasoned order running into 16 pages. In the facts and circumstances of this case, we are not inclined to agree with learned counsel that the judgment of the High Court in writ appeals has achieved finality.” (emphasis, italicised in print, supplied)
A perusal of the above clearly shows that the Supreme Court had entertained the Special Leave Petitions for the second time in view of liberty granted to the petitioner to approach the High Court to point out the case which had been pleaded before them. It has been explained that this liberty meant that the Court prima facie found the contention of the petitioner to be plausible.
In the present case, it is clear that the petitioner had withdrawn its earlier appeal by making a statement that it did not want to press the appeal as it wanted to pursue the application filed by it under s. 254(2) of the Act, which was pending. Neither any liberty to file a fresh appeal was sought nor granted. Thus, the dicta of A.P. State Financial Corporation’s case (supra) is clearly not applicable to the facts of this case.
It may also be mentioned that sub-rr. (3) and (4) of O. 23, r. 1, CPC, also make this position clear. The same are reproduced below for the sake of convenience : “(3) Where the Court is satisfied,— (a) that a suit must fail by reason of some formal defect, or, (b) that there are sufficient grounds for allowing the plaintiff to institute a fresh suit for the subject-matter of a suit or part of a claim, it may, on such terms as it thinks fit, grant the plaintiff permission to withdraw from such suit or such part of the claim with liberty to institute a fresh suit in respect of the subject-matter of such suit or such part of the claim. (4) Where the plaintiff— (a) abandons any suit or part of claim under sub-r. (1), or (b) withdraws from a suit or part of a claim without the permission referred to in sub-r. (3), he shall be liable for such costs as the Court may award and shall be precluded from instituting any fresh suit in respect of such subject-matter or such part of the claim.” (emphasis, italicised in print, supplied) Sub-r. (3) specifies the circumstances under which a Court may permit a plaintiff to withdraw from a suit with liberty to institute a fresh suit in respect of the same subject-matter. Sub-r. (4) places an embargo on institution of a fresh suit in respect of any subject-matter against which an earlier suit had been withdrawn without the requisite permission under sub-r. (3). In Upadhyay & Co. vs. State of U.P. AIR 1999 SC 509, while explaining the principle underlying r. 1 of O. 23 of the CPC, the Supreme Court at p. 512 has observed as under : ‘”We are of the view that the principle underlying r. 1 of O. 23 of the Code should be extended in the interests of administration of justice to cases of withdrawal of writ petition also, not on the ground of res judicata but on the ground of public policy as explained above. It would also discourage the litigant from indulging in Bench-hunting tactics. In any event there is no justifiable reason in such a case to permit a petitioner to invoke the extraordinary jurisdiction of the High Court under Art. 226 of the Constitution once again. While the withdrawals of a writ petition filed in High Court without permission to file a fresh writ petition may not bar other remedies like a suit or a petition under Art. 32 of the Constitution since such withdrawal does not amount to res judicata, the remedy under Art. 226 of the Constitution of India should be deemed to have been abandoned by the petitioner in respect of the cause of action relied on in the writ petition when he withdraws it without such permission’.”
In view of the above, we are satisfied that the appellant cannot be permitted to file a second appeal against the order of the Tribunal dt. 29th Oct., 1999, because no such liberty was granted to it when it was allowed to withdraw the earlier appeal vide order dt. 3rd Aug., 2001.
The present appeal is, therefore, treated to be only an appeal against the order of the Tribunal dt. 8th Aug., 2002, dismissing the application of the assessee under s. 254(2) of the Act. Search and seizure operations under s. 132(1) of the Act were carried out at the business as well as residential premises of the assessee-firm and its partner. During the course of search, certain books of account and documents were found. The same were seized. Thereafter, a notice under s. 158BC of the Act was issued on 31st Jan., 1996, requiring the assessee to file a return for the block period. The requisite return was filed on 15th July, 1996, and the assessment for the block period was completed by the AO vide order dt. 27th Sept., 1996, determining the undisclosed income for the block period at Rs. 2,20,150. The assessee filed an appeal against the order of the assessment before the Tribunal which was partly allowed vide order dt. 29th Oct., 1999. Thereafter, the assessee moved an application under s. 254(2) of the Act before the Tribunal wherein it was contended that certain submissions and arguments made by the assessee had escaped its notice while deciding the appeal which had resulted in miscarriage of justice and, accordingly, it was prayed that order dt. 29th Oct., 1999, should be recalled and the appeal be decided afresh. This application has been rejected by the Tribunal vide impugned order dt. 8th Aug., 2002. The Tribunal has observed that s. 254(2) of the Act does not authorise it to either review or recall its order. The scope of its jurisdiction under this provision is confined to rectification of the mistakes apparent from record which may be found in its order passed in appeal and consequent amendment, if any. The Tribunal has observed that there was nothing on record to show that the arguments, which are allegedly raised but not considered by the earlier Bench, were in fact, urged before the Bench at the time of hearing. Thus, it has been held that there is no mistake in its order which is apparent from the record warranting rectification under s. 254(2) of the Act.
13. Counsel for the appellant has not been able to controvert this factual position. He has not drawn our attention to any material on record to show that such contention had actually been raised before the Tribunal when the appeal was heard originally. The appeal was decided on 29th Oct., 1999, by a Bench of the Tribunal consisting of Vice President, Mr. R.M. Mehta, and Shri B.S. Saluja, JM. The application under s. 254(2) of the Act was filed after almost two years on 11th June, 2001, when the constitution of the Bench had undergone a change. If the assessee thought that the contentions raised by it before the Bench had not been taken note of, it was incumbent upon it to bring it to the attention of those very Members who had heard the appeal immediately on receipt of the order when the matter was still fresh in their minds. For this purpose, we may refer to the observations made by the apex Court in Roop Kumar vs. Mohan Thedani AIR 2003 SC 2418. In para 11 of the judgment, it has been observed as under : “. . . . statements of fact as to what transpired at the hearing, recorded in the judgment of the Court, are conclusive of the facts so stated and no one can contradict such statements by affidavit or other evidence. If a party thinks that the happenings in Court have been wrongly recorded in a judgment, it is incumbent upon the party, while the matter is still fresh in the minds of the Judges, to call the attention of the very Judges who have made the record. That is the only way to have the record corrected. If no such step is taken, the matter must necessarily end there. It is not open to the appellant to contend before this Court to the contrary.” (emphasis, italicised in print, supplied)
14. This principle has been reiterated in Shankar K. Mandal vs. State of Bihar AIR 2003 SC 4043 and, also in Central Bank of India vs. Vrajlal Kapurchand Gandhi AIR 2003 SC 3028.
15. In the present case, the application has been filed after about two years and that too when the constitution of the Bench had undergone a change. Thus, to decide the claim made in the application under s. 254(2) of the Act, the successor Members of the Bench could only refer to the material on record to see as to whether such contentions had been raised or not. Admittedly, no such material is available.
16. In this view of the matter, no fault can be found with the finding of the Tribunal that there was no mistake apparent from the record warranting action under s. 254(2) of the Act. We are, therefore, of the view that no substantial question of law arises out of the order of the Tribunal dt. 8th Aug., 2002, for consideration by this Court.
17. There is a delay of 77 days in refiling the appeal. An application for condonation of the said delay has also been filed along with the appeal. However, since we are satisfied that there is no merit in the appeal, we do not deem it necessary to issue notice to the respondents merely to consider the application for condonation of delay.
18. The appeal is, accordingly, dismissed in limine. No costs.
[Citation : 272 ITR 301]
