ITAT to obtain satisfaction from Misc. application on causes shown for not appearing on the date of hearing in original proceedings – High Court
In a recent judgment, Hon’ble High Court restored the case to ITAT as it had failed to obtain satisfaction from the miscellaneous application to recall order and relied upon the original order on causes shown for not appearing on the date of hearing.
ABCAUS Case Law Citation:
4324 (2024) (11) abcaus.in HC Orrisa
In the instant case, the assessee had challenged the order passed by the ITAT dismissing the miscellaneous Application for recalling the order disposed of ex parte.
The issue involved in the appeal was an order passed by Principal CIT u/s 263 fastening liability on the assessee for non- deduction of TDS in respect of the transport charges paid which were more than Rs. 30,000/- .
In the original proceedings before the Tribunal none represented on behalf of the assesse, however, an adjournment letter was filed, according to the assessee could not collect papers from the accountant due to his illness and a further time of 20 days was sought.
The Tribunal observed that the appeal had been posted for hearing more than 21 times and the appeal was previously disposed of ex-parte. However, it was recalled by miscellaneous application.
The Tribunal observed that on the last hearing the counsel of the assessee had also signed the order sheet as having been informed of the date of hearing, being chosen by the counsel. Now, again the adjournment was sought, which was nothing but a challenge to the functioning of the Bench.
The Tribunal opined that till date the assesse having been unable to get the details to represent its case, now seeking additional 20 days to get details from the accountant was nothing but delay tactics.
Accordingly, the appeal was dismissed.
However, against the order of dismissal of the appeal, the assessee again filed a second Miscellaneous Application for recalling the order and proposed to file various judgments.
The Tribunal observed out that in Miscellaneous application, it is only the mistake in the order of the Tribunal, which can be rectified. To apply the case laws, the facts should be laid down and the error in the factual recording of the Tribunal has to be pointed out before the case laws have to be applied.
The Tribunal further observed that the original order of the Tribunal clearly showed that on earlier occasion also, the appeal had been disposed of exparte after posting the same for hearing on 21 times. The specific date as requested by Counsel had been provided. On the said date also, the counsel had sought adjournment.
The Tribunal further noted that in the second miscellaneous application, the fault was being placed on the accountant of the assessee. The appeal had been disposed of after more than five years and it has been specifically recorded in the order of that TDS had not been collected in the last 5 years and would obviously not be possible in 20 days and again the adjournment sought was nothing but to challenge to the functioning of the Bench.
Observing that no mistake had been pointed out in the order of the Tribunal, the second M.A. filed by the assessee was also dismissed.
Against the dismissal of second M.A., the assessee approached the Hon’ble High Court and submitted that the M.A. was an application for recalling order disposing of the appeal ex-parte. That sufficient cause was shown by the said M.A. but the Tribunal arbitrarily dismissed the same.
The assessee relied upon a Coordinate Bench judgment of the Hon’ble High Court and placed reliance on rule 24 in Income Tax (Appellate Tribunal) Rules, 1963 which states as under:
“Provides that “where, on the day fixed for hearing or on any other date to which the hearing may be adjourned, the appellant does not appear in person or through an authorised representative when the appeal is called on for hearing, the Tribunal may dispose of the appeal on merits after hearing the respondent:
Provided that where an appeal has been disposed of as provided above and the appellant appears afterwards and satisfies the Tribunal that there was sufficient cause for his non-appearance, when the appeal was called on for hearing, the Tribunal shall make an order setting aside the ex-parte order and restoring the appeal.”
It was submitted that judgment was, the Tribunal cannot dismiss an appeal for want of prosecution and it ought to have decided the appeal on merits even if appellant or the counsel was not present, when the appeal was taken up for hearing.
The Hon’ble High Court observed that the Tribunal considered the appeal disposal order, wherein it had been specifically recorded that “what has not been collected in the last 5 years would obviously not be possible in 20 days and again the adjournment sought is nothing but to challenge to the functioning of the Bench”.
However, the Hon’ble High Court further observed that Tribunal failed to see that it was to obtain satisfaction from the application, on causes shown for not appearing on the date of hearing. The cause alleged was indisposition of the learned advocate.
As a result, the impugned order was set aside and quashed. The miscellaneous application was allowed and the appeal restored. Petitioner was directed to obtain date of hearing of the appeal per convenience of the Tribunal. Omission of petitioner to be represented on date fixed for hearing of the appeal will automatically restore impugned order.
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