DCIT vs. Sham Sunder Sharma (ITAT Chandigarh)

DATE: June 16, 2015 (Date of pronouncement)
DATE: July 1, 2015 (Date of publication)
AY: 2007-08
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S. 250: Orders of the ITAT are binding on the lower authorities and should be followed unreservedly. Blatant failure to do so could attract contempt of court proceedings

The CIT(A), instead of following the order of the Tribunal, followed the order of his predecessor even though it had been set aside by the Tribunal. He also blatantly observed in the order that he cannot sit in judgment over the view taken by his predecessor. On appeal by the department to the Tribunal HELD allowing the appeal:

(i) The findings of the CIT (Appeals) clearly show that instead of deciding the appeal on merits and in compliance with the order of the Tribunal dated 23.11.2011, he preferred to follow the view and order passed by his predecessor. The CIT(A) has even gone to the extent of noting in the impugned order that the view taken by his predecessor was correct. Thus it is clear that the CIT (A) has shown disobedience to the order of the Tribunal by which the earlier order of the predecessor of the CIT (A) was set aside by the Tribunal in toto. The earlier order of the predecessor of the CIT (A) would not stand in the eyes of law;

(ii) It is a clear case of showing disrespect to the order of the Tribunal. Therefore, contempt proceedings could have been initiated against the CIT (A) for blatantly disobeying the order of the Tribunal. The Madhya Pradesh High Court in Agrawal Warehousing & Leasing Ltd. vs. CIT 257 ITR 235 held that the CIT (A) cannot refuse to follow the order of the Appellate Tribunal. The CIT (A) is a quasi – judicial authority and is subordinate in judicial hierarchy to the Tribunal. The orders passed by the Tribunal are binding on all the revenue authorities functioning under the jurisdiction of the Tribunal. The principles of judicial discipline require that the orders of the higher appellate authorities should be followed unreservedly by the subordinate authorities (Union of India Vs. Kamlakshi Finance Corporation AIR 1992 SC 711 referred);

(iii) The order of the CIT (A) cannot be sustained in law and is clearly in defiance of the order of the Tribunal. Since it is a first matter reported to us during the course of arguments by the D.R that the order of the CIT (A) shows complete defiance of the order of the Tribunal, therefore, we do not propose at the stage to initiate contempt proceedings against the CIT (A). However, we warn him to be careful in future in following the order of the Tribunal in accordance with law and should not show any defiance to the order of the Tribunal.

5 comments on “DCIT vs. Sham Sunder Sharma (ITAT Chandigarh)

  2. ITAT need to proceed with contempt proceedings to discipline revenue persons, they are all head strong lot.

  3. unless ITAT does , revenue would harass the tax payer irrationally for any obvious reasons.

  4. E.H.Ansari says:

    Some officers in the Deptt. even follow the findings of their lower authorities if it suits them. Conversely, they disregard H.Courts Order ,if assesee
    does not prove himself up to the expectation of the
    AO or CIT(A)

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