ITAT Can’t Recall Its Order Based on Subsequent Judgment of Supreme Court | Mumbai ITAT

Case Details: DCIT vs. ANI Integrated Services Ltd. - [2024] 162 taxmann.com 889 (Mumbai-Trib.)

Judiciary and Counsel Details

• • B.R. Baskaran, Accountant Member & Amit Shukla, Judicial Member
  • H.M. Bhatt for the Appellant.
  • Dharan Gandhi for the Respondent.

Facts of the Case

The assessee filed its return of income for the relevant assessment year. During the assessment proceedings, the Assessing Officer (AO) disallowed the deduction claimed by the assessee on account of the delay in deposits of employee’s contribution towards the provident fund and ESIC. The matter was then taken to the Tribunal. The Tribunal held that the assessee had filed its return of income by the due date specified under section 139(1). Thus, the deduction claimed by the assessee regarding the delayed deposit of employees’ contributions towards the provident fund and ESIC was allowable.

The AO filed a Miscellaneous Application before the Mumbai Tribunal to recall the order passed by the Tribunal, contending that the Tribunal’s order was based on the binding precedents available at that time. However, in case of Checkmate Services P. Ltd. v. CIT [2022] 143 taxmann.com 178 (SC), the Hon’ble Supreme Court reversed the judgment based on which the Tribunal passed the order. Thus, the order passed by the Tribunal was based on an erroneous interpretation of law.

ITAT Held

The Mumbai Tribunal held that the Constitutional Bench of the Hon’ble Supreme Court clearly opined that the change in law or subsequent decision/judgment of a Co-ordinate Bench or a larger Bench by itself cannot be regarded as a ground of review.

Admittedly, when the judgment of the Tribunal was passed, it was based on the law binding on the Tribunal and authorities below by a series of judgments of the Hon’ble Jurisdictional High Court and other High Courts. Thus, the decision of the Tribunal was rendered before the judgment of the Hon’ble Supreme Court.

The judgment of the Hon’ble Supreme Court will apply in all the cases where the lis or cases are pending before any Court or forum. But once the issue in the appeal has attained finality following the earlier binding precedence of the jurisdictional high court and there are no lis pending, based on the subsequent judgment of a superior court, do not alter the finality of the judgment.

If the Revenue’s contention is to be accepted. In that case, whenever a judgment is reversed by a higher Court or by any Constitutional Court subsequently in some different case, all the appeals and matters which have been decided following the earlier order of the Constitutional Courts/High Court or Supreme Court do not mean that all such orders should be recalled even when no lis is pending and to disturb the finality.

Further, the powers under section 254(2) are akin to Order XLVII Rule 1 of CPC. While considering the application under section 254(2), the Tribunal is not required to revisit its earlier order and discuss merits. The powers under section 254(2) are only to rectify or correct any mistake apparent from the record. The Tribunal cannot revisit its order based on a subsequent judgment of a higher court.

Therefore, the Tribunal was not required to recall its order based on a subsequent judgment of the Apex Court.

List of Cases Reviewed

• • CIT v. Reliance Telecom Ltd. [2022] 440 ITR 1 (SC)
  • ACIT v. Saurashtra Kutch Stock Exchange Ltd. reported in (2008) 305 ITR 227
  • Beghar Foundation v. K.S. Puttaswamy [2021] 123 taxmann.com 344 (SC)
  • CIT v. Gracemac Corporation reported in (2023) 456 ITR 135 (para 22) followed.

List of Cases Referred to

• • Checkmate Services (P.) Ltd. v. CIT [2022] 143 taxmann.com 178/448 ITR 518/[2023] 290 Taxman 19 (SC) (para 2)
  • CIT (IT-4) v. Reliance Telecom Ltd. [2021] 133 taxmann.com 41/[2022] 440 ITR 1/284 Taxman 517 (SC) (para 11)
  • Beghar Foundation v. Justice K.S. Puttaswamy [2021] 123 taxmann.com 344/278 Taxman 1 (SC) (para 14)
  • CIT v. Gracemac Corporation [2023] 153 taxmann.com 681/456 ITR 135/294 Taxman 708 (SC) (para 17)
  • Asstt. CIT v. Saurashtra Kutch Stock Exchange Ltd. [2008] 219 CTR 90/305 ITR 227/173 Taxman 322 (SC) (para 20)
  • Hiralal Bhagwati v. CIT [2000] 161 CTR 401/246 ITR 188 (Gujarat) (para 20)
  • Suhrid Geigy Ltd. v. Commissioner of Surtax [1998] 150 CTR 424/[1999] 237 ITR 834/107 Taxman 347 (Gujarat) (para 20).