TMI Blog2016 (7) TMI 1677X X X X Extracts X X X X X X X X Extracts X X X X ..... if the assessees claim that there was no order passed under section 254(1), there is no right of filing a petition u/s 254(2) of the Act. The impugned order was passed by the Tribunal u/s 254(1) of the I.T. Act and in the given circumstances, dismissal of the appeals is the only conclusion that can be drawn which could have been challenged by the assessees within a period of 04 years and beyond such period the Tribunal has no power to condone the delay and therefore, the M.As are not maintainable. Dismissal of appeal for want of prosecution - Even if it is presumed that the Tribunal has got the power to condone the delay the reasons given by the assessees herein are vague and not supported by proper evidence and therefore, it has to be concluded that the assessees have no sufficient cause for the delay in filing M.As. If the assessees claim that the common order passed by the Tribunal in 2008, dismissing the appeals for want of prosecution, cannot be equated to an order passed under section 254(1) of the I.T. Act and therefore, section 254(2) does not come into play and consequently, the period of limitation does not apply, then the remedy to the assessees would have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or hearing in 1998 and from then onwards, assessees counsels were seeking adjournments from time to time and on 22.07.1998 it was specifically mentioned that the cases would be adjourned finally on the undertaking of assessees Counsel that he would not be seeking further adjournments. But again on 07.08.1998, the assessees sought one more adjournment and hence the Bench adjourned it sine die but again from 2007 onwards appeals were posted for hearing from time to time but a new Counsel appeared, again seeking adjournments on some pretext or the other. After sufficient lapse of time, a request was made to club departmental appeals and other appeals and accordingly, the appeals were grouped together. Even thereafter, the cases were adjourned on number of occasions. Finally when the appeals were posted for hearing on 18.03.2008, the Bench rejected the request of the assessees for further adjournment by observing as under : . . It is indeed a very sorry state of affairs that the appeals, though very old, have not been disposed of yet and for which the major blame goes to the assessees themselves. The earliest appeal was filed in 1996 and most of the other appeals are filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal observed that there were three appeals filed by the Revenue also in the case of Mahaveer Combines P. Ltd., and Unique Plastics P. Ltd., wherein the department challenged the deletion of the addition made on protective basis particularly on account of the fact that the additions made on substantive basis are pending before the Tribunal. In this regard, the Tribunal observed that the assessee s appeals having been dismissed by upholding the additions made on substantive basis the appeals relating to the protective additions do not survive and on that ground they were also dismissed with a rider that if the appeals of the assessee are reinstated by the Tribunal, then the three appeals of the department shall also stand reinstated automatically. 4.1. Though the orders were passed on 18.03.2008, the assessees herein preferred to file M.As on 06.10.2015 after lapse of about 07 years whereas the statute permits an assessee to prefer a M.A. within 04 years. When called-upon the Ld. Counsel appearing on behalf of the assessee to explain as to how such M.As can be admitted, the Ld. Counsel vehemently contended that the adjournments granted on earlier occasions, from 1996 onwards, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication is moved within the period as allowed i.e., 04 years, the Tribunal may, at any time, dispose of the application even if the time taken is beyond 04 years. Ld. Counsel appearing on behalf of the assessees submits that the aforecited decisions referred to the suo motu powers of the Tribunal to consider the matter on merits any time even after the expiry of limitation of 04 years. He also submitted that upon filing an appeal before the Appellate Tribunal, it is the duty of the Tribunal to dispose of the appeal as per the provisions of section 253 of the Act by passing an appropriate order whereas, in the instant case, the Tribunal had not passed a valid order since it is in violation of Rule 24 of the Appellate Tribunal Rules and also contrary to the decision of the Apex Court in the case of CIT vs. S. Chenniappa Mudaliar 71 ITR 41 (SC) as well as the decision of the Apex Court in the case of Balaji Steel Re-rolling Mills (Civil Appeal No.10265 of 2014). In the said case, the Apex Court observed that the Tribunal has no power to dismiss the appeal for want of prosecution. Thus, he contended that order passed in violation of the Supreme Court order is non-est in the eye of Law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kishan reported in 23 taxmann.com 383. He has also relied upon various decisions of High Courts to submit that if an assessee follows lackadaisical approach, by not challenging the order within the time frame prescribed, the authorities concerned should not extend the benefit of condonation in such cases. He has also highlighted the reasons given by the assessees in the M.As, as well as in the written submissions filed on behalf of the assessees, to submit that assessees have not provided any proof to show that they have shifted to a far-off place abandoning their whole interest in Hyderabad. Therefore, assessees explanation for the delay cannot be accepted on the face of it. 5.1. He further contended that Rule 24 of the I.T. Rules cannot have independent application since the said Rules are framed in exercise of the powers conferred in sub-section (5) of section 255 of I.T. Act. He also distinguished line of decisions cited by the Ld. Counsel for the assessee by stating that in the case law relied upon by the assessees the M.As were filed within the time frame of 04 years wherein the delay, in not passing an order, is not in the control of the parties who approached the Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isdiction of the Hon ble High Court either under section 260A of the I.T. Act or under Article 227 of the Constitution of India. In otherwords, the assessees having not chosen to pursue the remedy available, they cannot - after long lapse of time - claim that the order passed by the Tribunal is contrary to law. In the case of Parsuram Potteries Works Co. Ltd., vs. ITO (106 ITR 1 at page-10) the Hon ble Supreme Court observed that stale issues should not be re-activated beyond a particular stage and there must be a point of finality in all the legal proceedings; lapse of time must induce or set at rest all judicial and quasi-judicial controversies as it must in others spheres of human activity. A proper approach is to challenge the order before a higher Forum, either under section 260-A of the Income Tax Act or in writ jurisdiction, by taking immediate steps, after disposal of the appeals. Here is a case where there was more than 07 years delay and in fact, the assessees did not choose to pursue such a kind of remedy. At the same time, the Ld. Counsel appearing on behalf of the assessee submits that the impugned order passed by the Tribunal cannot be treated as an order passed under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal cannot be found to have committed a mistake. This decision was affirmed by Hon ble Mumbai High Court (supra). 7.3. In the M.As filed before us the assessees have filed the applications under Rule 24 of the I.T. Rules for which the assessees have to furnish proper reasons for non-appearance on the dates fixed for hearing. The explanation given on behalf of the assessees is very vague. It was submitted in the application that Sri Paresh Dhanji Chedda has serious health problems because of his old age and he was medically adviced to take rest in his native village at Kutch in Gujrat and to take care of him the entire family shifted to Kutch. In 2012 when his condition further deteriorated he was brought back to Hyderabad in critical condition for medical treatment. However, he could not survive and ultimately passed away in 2013. Thereafter, the family members had gone back to the native place to settle several things which caused further delay in filing M.As. 7.3.1. It may be noticed that the appeals were dismissed for want of prosecution in 2008 and there is nothing on record to suggest that assessees have completely shifted lock, stock and barrel from Hyderabad in 2007 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f on a particular aspect the Court may have a sympathetic view on the party. 7.4. Before parting, we may observe that the Tribunal is a final fact finding authority and matters involving facts can be decided on merits only when facts are placed on record. In these group of matters, additions were made consequent to search action conducted on 14.09.1995 jointly in the case of Mr. Paresh Dhanji Chedda. The additions are based on certain material found during the course of search. The A.O. has given a categorical finding on the issues on hand after taking into consideration the relevant material. If the assessees challenge the finding of the tax authorities it is for them to file paper books to highlight that the decisions rendered by the lower authorities is not in accordance with law and facts. Paper Book, if any, has to be filed under Rule-18 of the Appellate Tribunal Rules. Rule 18(6) says that only those papers which are referred to at the time of hearing can be taken as papers filed before the Tribunal. The relevant Rule is extracted for immediate reference : Rule 18(6) : Documents that are referred to and relied upon by the parties during the course of arguments are alo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s presumed that the Tribunal has got the power to condone the delay the reasons given by the assessees herein are vague and not supported by proper evidence and therefore, it has to be concluded that the assessees have no sufficient cause for the delay in filing M.As. (3) If the assessees claim that the common order passed by the Tribunal in 2008, dismissing the appeals for want of prosecution, cannot be equated to an order passed under section 254(1) of the I.T. Act and therefore, section 254(2) does not come into play and consequently, the period of limitation does not apply, then the remedy to the assessees would have been to approach an appropriate Forum to challenge the order which is claimed to be invalid in law. But the assessees chose not to prefer either appeal or writ petition before the Hon ble High Court and thus, by efflux of time it has attained finality and such stale issues should not be reactivated at this stage in the light of observations of the Hon ble Supreme Court in the case of Parsuram Potteries Works Co. Ltd., vs. ITO. In the result, the M.As filed by the assessees are dismissed. Order pronounced in the open Court on 15.07.2016. - - TaxTMI - TM ..... X X X X Extracts X X X X X X X X Extracts X X X X
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