TMI Blog2022 (11) TMI 1328X X X X Extracts X X X X X X X X Extracts X X X X ..... E COURT] has held that non-consideration of the decision of the jurisdictional high court/Supreme Court constitutes mistake apparent from record and is rectifiable within the meaning of section 254(2). Article 141 of the Constitution of India provides that the law declared by Hon ble Supreme Court shall be binding on all courts within the territory of India. The law laid down by Supreme Court operates retrospectively and is deemed to the law as it has always been unless, the Supreme Court, says that its ruling will only operate prospectively. There is a mistake apparent on record in view of the decision of the Hon ble Supreme Court in the case of Checkmate Services Pvt.Ltd. [ 2022 (10) TMI 617 - SUPREME COURT] though rendered subsequent to the order passed by the Tribunal and has to be rectified by holding that the disallowance made by the revenue authorities u/s.36(1)(va) of the Act was justified. Consequently, the appeal by the Assessee will stand dismissed. The order of the Tribunal will stand modified /rectified accordingly. - M.P. No.117/Bang/2022 (Arising out of ITA No.613/Bang/2021) - - - Dated:- 30-11-2022 - SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. BEEN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ismiss the appeal of the Assessee. 3. At the time of hearing, the Ld. A.R. made primary objection that the miscellaneous petition filed by the revenue is barred by time as the order was passed on 22.3.2022 and the revenue filed the miscellaneous petition on 31.10.2022. According to the ld. AR, time limit to file MA u/s 254(2) of the Act is within 6 months from the end of the month in which the order was passed. As such, the order was passed in this case was on 22.3.2022 and time limit to file MA u/s 254(2) of the Act will expire 6 months from the end of the month of March, 2022 i.e. 30.9.2022 and in the present case, since the MA has been filed by the revenue only on 31.10.2022, which is time barred and the same is to be dismissed in limine. 4. On the other hand, ld DR submitted that in this case, the order dated 22.3.2022 has been served on department i.e. Principal CIT, Bengaluru, only on 25.4.2022 by hand and the period of limitation for filing application u/s 254(2) of the Act, would start from the point of time when the order u/s 254(1) of the Act is communicated to the assessee and not from the date of passing of the order. He submitted that once the date of communicati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is amply clear that the date of order should be construed and reckoned with the date of knowledge of the order i.e., when the order has been communicated to the pacify. The legal maxim behind this is, how a person concerned or a person aggrieved is expected to exercise the right of remedy conferred by the Statute, unless the order is communicated or known to him either actual or constructively. The underlying principles is of fair play and recognition of legal rights of remedy in a constructive manner and not to give any construction or interpretation so as to defeat the purpose for which the legal remedy has been enacted in the provisions relating to limitations. It iso fundamental principle of justice and fair play that parties, whose rights are affected by an order must have a knowledge or notice of it, otherwise, the legal rights to remedy is lost to the party, even when he is not at fault. 5.3 However, in a recent decision, the Hyderabad Tribunal in miscellaneous application proceedings u/s 254 (2) in the case of Srinivas Sashidhar Chaganty vs. ITO ( Hyd. ITAT A Bench M.A. no. 05/Hyd/2017 arising in ITA no. 1420/Mum/2015 dated 12-7-2017 for Assessment Year 2007-08 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, communication and knowledge of the order passed is necessary and in consonance with the principles of fair play. If the party aggrieved is not made aware of the order it cannot be expected to take recourse to the remedy available against it. Therefore, the fundamental principle is that the party whose rights are affected by any order must have the knowledge of the order. Thus, it can be said that for the purposes of calculating limitation the expression from the date of the order , is to be construed to mean the date of communication or knowledge of the order . In the instant case, the date of knowledge of the order, according to the petitioner is 18-8-1988 and the date of actual service and communication undisputedly happens to 29-2-1988. The appeal was preferred on 19-9- 988. On 18-9-1988 there was a holiday. Thus, the appeal was within limitation both from the date of knowledge of the order and its service. In this view of the matter, the appellate authority manifestly erred in law in dismissing the appeal as barred by time. 5.5 In view of the above precedents, in our opinion, the time limit to file a miscellaneous petition u/s 254(2) of the Act to rectify the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent is an important aspect of legal certainty in rule of law. That principle is not obliterated by section 254(2) of the Income-tax Act, 1961. When prejudice results from an order attributable to the Tribunal's mistake, error or omission, then it is the duty of the Tribunal to set it right. Atonement to the wronged party by the court or Tribunal for the wrong committed by it has nothing to do with the concept of inherent power to review. In the present case, the Tribunal was justified in exercising its powers under section 254(2) when it was pointed out to the Tribunal that the judgment of the coordinate bench was placed before the Tribunal when the original order came to be passed but it had committed a mistake in not considering the material which was already on record. The Tribunal has acknowledged its mistake, it has accordingly rectified its order. In our view, the High Court was not justified in interfering with the said order. We are not going by the doctrine or concept of inherent power. We are simply proceeding on the basis that if prejudice had resulted to the party, which prejudice is attributable to the Tribunal's mistake, error or omission and which error is a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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