TMI Blog1989 (8) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... considered by them in passing their order dated June 27, 1985 ? (3) Whether the Income-tax Appellate Tribunal was correct in law and on facts in holding that the Tribunal inadvertently failed to consider the material facts regarding : (i) repayment of loan by Smt. Prem Lata Bhatia ; (ii) failure to consider the income-tax and wealth-tax returns filed by Smt. Prem Lata Bhatia, especially when the Tribunal itself have given finding on both these facts in their order dated June 27, 1985 ? (4) Whether the Income-tax Appellate Tribunal was correct in law and on facts in recalling their order dated June 27, 1985, in I.T.A. No. 917/Del. of 1983 especially when there is no mistake apparent from the record as envisaged in section 254(2) of the Income-tax Act, 1961 ? (5) Whether the Income-tax Appellate Tribunal was correct in law and on facts in having recourse to section 254(2) of the Income-tax Act, 1961, in recalling their own order dated June 27, 1985, in I.T.A. No. 917/ Del. of 1983 ?" Briefly stated, the facts of the case are that, in respect of the assessment year 1976-77, the Income-tax Officer framed the assessment. Against that, in respect of property No. E-73, Kalkaj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... doing so. In our opinion, there is no force in the contention of learned counsel for the respondent. Firstly, we find that the Tribunal has purported to exercise its jurisdiction under section 254 of the Act. As has already been stated hereinabove, the respondent itself, in its application, stated that the said application was being filed under section 254 of the Act. The Tribunal also, while dealing with the application, came to the conclusion that there was a mistake in its order and that, therefore, the order had to be recalled. In addition thereto, the Tribunal noted that the application which had been filed was under section 254(2) of the Act. What is of greatest importance, however, is the fact that the application under section 256(1) was dismissed by the Tribunal on merits. If the order dated January 30, 1986, had not been passed in the purported exercise of its powers under section 254 of the Act, the Tribunal would not have entertained the application under section 256(1). It is well-settled that reference petition under section 256 can be filed only against an order passed under section 254 of the Act. It is also pertinent to note that the respondent did not raise s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n arose was that an appeal to the Tribunal had been dismissed in default of appearance of the assessee's representative. An application was filed for review of this order. The Tribunal held that it had no power to review its order passed in appeal. Petition under article 226 of the Constitution was filed and the Punjab High Court held that, in exceptional circumstances and in rare cases, the Tribunal can recall and quash its own order where it is shown that it was obtained by fraud or by a palpable mistake or was made in utter ignorance of a statutory provision and the like. In our opinion, the said decision is no authority for the proposition which is now sought to be raised before us. In that case, the Tribunal was called upon to recall its order not on merits but for the reason that there was a procedural irregularity, as proper opportunity had not been granted to the assessee to argue its appeal. The power which was sought to be exercised by the Tribunal was incidental or ancillary to the exercise of its appellate power. Incidental or ancillary power can, in our opinion, be exercised by a Tribunal for the furtherance of the exercise of statutory power which is conferred upon it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal recalled its earlier order and heard the appeal afresh. The question which arose was that from the order recalling the appellate decision, whether a reference could be filed under section 27 of the Wealth-tax Act. This court held that the Tribunal had the inherent power to restore the appeal which had been disposed of without realising that the notice of hearing had not been properly served. It was observed that the order of the Tribunal was maintainable under section 35 of the Wealth-tax Act, which section provides for rectification of orders and is analogous to section 256(2) of the Income-tax Act, 1961. It was stated that (at page 307) "When the assessee brought to the notice of the Tribunal that valid service had not been effected on her and the Tribunal came to realise that the appellant had not been served, it was entitled to rectification under section 35(1)(d) of the Wealth-tax Act and passed appropriate orders for amending the position". As no reference can be filed against a decision under section 35 of the Act, the application of the Commissioner in that case was dismissed. In Illa Dalmia's case [1987] 168 ITR 306, this court also observed that even if one accepted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal has incidental or ancillary powers which can be exercised by it. But such power cannot be invoked to rehear a case on merits. The Tribunal can, after disposing of the appeal under section 254(1), rehear the matter on merits only within the purview of section 254(2). The Supreme Court has held in Patel Narshi Thakershi v. Pradyumansinghji Arjunsinghji, AIR 1970 SC 1273, that the power to review is not an inherent power. It must be conferred by law either specifically or by necessary implication. It does not stand to reason that, if the power of review is not present with the Tribunal, it, nevertheless, can exercise such power indirectly when it cannot do so directly. If the contention of learned counsel for the respondent is correct, then it could mean that, even on merits, the Tribunal can recall its earlier order and then hear the case afresh and pass a different order. If this is so, it would amount to the Tribunal exercising power of review when it does not have any such power. To give an example, under the provisions of the Code of Civil Procedure, Order 47 provides the circumstances in which a judgment may be reviewed. If the contention of learned counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
