Facts of the Case

  • The case pertains to Assessment Year 2010–11.
  • The Tribunal had earlier dismissed the assessee’s appeal on 17.12.2018 for non-prosecution.
  • The assessee later filed a miscellaneous application seeking recall of the order on the ground that no notice of hearing was received.
  • The Tribunal accepted this contention and recalled its earlier order.
  • The Revenue challenged this recall before the Delhi High Court.

Issues Involved

  1. Whether the ITAT was justified in recalling its earlier order on the ground of non-service of notice.
  2. Whether the Revenue can challenge factual observations recorded by the Tribunal without seeking correction before the Tribunal itself.
  3. Whether any substantial question of law arises in such circumstances.

 Petitioner’s Arguments (Revenue)

  • The Revenue argued that the Tribunal incorrectly recorded that there was no objection from the Departmental Representative (DR).
  • An affidavit and internal communication were relied upon to show that the DR had actually opposed the assessee’s submissions.
  • It was contended that the Tribunal’s findings were based on an incorrect appreciation of facts.

 Respondent’s Arguments (Assessee)

  • The assessee maintained that no notice of hearing was served, resulting in absence during proceedings.
  • It was argued that dismissal for non-prosecution without notice violates principles of natural justice.
  • Therefore, recall of the order was justified and within the Tribunal’s jurisdiction.

Court’s Findings / Order

  • The High Court held that:
    • If the Revenue believed that the Tribunal recorded facts incorrectly, it ought to have approached the Tribunal for rectification.
    • In absence of such action, the Court must accept the Tribunal’s recorded proceedings.
    • Once it is established that notice of hearing was not served, the Tribunal is justified in recalling its order.
  • The Court also relied on similar precedents:
    • Cement Corporation of India Ltd. vs ACIT
    • Pr. Commissioner of Income Tax vs Green Mark Infra Ltd.

Final Order:

  • The appeal filed by the Revenue was dismissed.
  • The Court held that no substantial question of law arises.

 Important Clarification

  • Court records are binding unless corrected by the same forum.
  • Non-service of notice is a valid ground for recall of ex-parte or dismissal orders.
  • ITAT has inherent powers under Section 254 to ensure justice and fairness.

 Link to download the order -https://delhihighcourt.nic.in/app/showFileJudgment/RAS17022023ITA1042023_160909.pdf

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.