TMI Blog2011 (2) TMI 804X X X X Extracts X X X X X X X X Extracts X X X X ..... ong back, in the guise of rectification. Decided against the Revenue. - ITA NOS. 161 AND 164 (LUCKNOW) OF 2004 - - - Dated:- 15-2-2011 - SHRI H.L. KARWA, AND SHRI N.K. SAINI, JJ. Represented By: Anadi Verma for the Appellant. Yogesh Agrawal for the Respondent. H.L. Karwa, Vice-President This miscellaneous application by the Revenue arises out of the order of the Tribunal dt. 10th May, 2005 passed in ITA No. 164/Luck/2004 and ITA No. 161/Luck/2004 relating to block period 1st April, 1990 to 30th April, 2000. 2. The Asstt. CIT, Central Circle, Bareilly vide his application dt. 9th Sept., 2009 has stated as under : "Hon'ble Sir, Kindly refer to the order dt. 10th May, 2005 in the above-mentioned case. A sea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Hon'ble Supreme Court's order holding that proviso to section 113 is clarificatory. Accordingly the above order of the Tribunal also needs to be amended and a clear direction in regard to the issue under section 113 of the IT Act, 1961 may kindly be issued. It is, therefore humbly requested that the order dt. 10th May, 2005 may kindly be rectified under section 254(2) of the IT Act and order of the AO on the issue of levy of surcharge in the block assessment may kindly be confirmed. 5th March, 2009 Yours faithfully, Sd/- Sanjiv Mahajan, Asstt. CIT, Central Circle, Bareilly." 3. We have heard the rival submissions and have also carefully gone through the contents of the application. In ITA No. 164/Luck/2004, the Revenue has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch is prior to insertion of proviso to section 113, is valid in law. 3.3. Ultimately, the Special Bench vide order dt. 26th April, 2006 decided the issue, which is Merit Enterprises (supra). The Special Bench of the Tribunal held as under : "Thus, the levy of surcharge prior to introduction of proviso to section 113 w.e.f. 1st June, 2002, is riddled with complexity to the extent of making it unworkable and impossible to harmonise and therefore, the levy fail." 3.4. We find that the ITA No. 163/Luck/2004 has been decided by the Tribunal on 10th May, 2005. At that time, the issue was pending before the Tribunal, Special Bench in the case of Merit Enterprises (supra). Shri Anadi Verma, learned Departmental Representative submitted that n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of the matter, we do not find any mistake apparent from the record, which needs to be rectified by this Bench of the Tribunal. 3.6. In the case of CIT v. Kirti Kumar Shah, the question before the Hon'ble High Court of Rajasthan (Jodhpur Bench) (sic) was as under : "Whether in the facts and circumstances of the case, the Tribunal was justified in holding that levy of surcharge while computing tax demand is /debatable issue and hence non-levy of it could not be made subject-matter of application for rectification under section 154 of the IT Act, 1961." The Hon'ble High Court of Rajasthan (Jodhpur Bench) (sic) answered the above question against the Revenue. As regards the judgment of the Hon'ble Supreme Court in the case of Suresh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eby the High Court dismissed the Department's appeal holding that no substantial question of law arose, following its decision in IT Appeal No. 155 of 2007 in which the High Court had held that no order levying surcharge in the case of a block assessment arising out of search proceedings taken prior to 1st June, 2002, could have been passed in rectification proceedings under section 154 of the IT Act, 1961, and that the proviso to section 113 of the Act inserted w.e.f. 1st June, 2002 by the Finance Act, 1999 did not have any retroactive effect. The Supreme Court dismissed the SLP holding that the rectification application was not maintainable as the question related to the nature of section 113 of the Act (whether it was clarificatory or no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cordingly set aside." 3.11. From the above decision of the Hon'ble Calcutta High Court, it is clear that even retrospective operation of the pronouncement on the interpretation of law can be made only in the cases, which have not been decided finally and the same is pending for adjudication. We cannot take advantage of the subsequent pronouncement of a superior Court in a closed and settled matter, particularly in the matter decided and settled four years back in the guise of rectification in view of the judgment of the Hon'ble High Court also, the application of the Department is liable to be dismissed. In view of the above, we do not find any merit in the application filed by the Revenue under s. 254(2) of the Act and accordingly we d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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