Allowing the petition the Court held that the appeal had been dismissed ex parte for non-prosecution. At the same time, the assessee was granted liberty to approach the Appellate Tribunal for recall of the order if it was able to show a reasonable cause for non-appearance. Thus, there was no adjudication on the merits of the appeal. The dismissal of the application for recall of the order on the ground of limitation was not valid. Court considered the Rule 24 and 35 of the Appellate Tribunal Rules 1963 . As per Rule 24 no limitation is prescribed . Rule 35 also requires that the orders are required to be communicated to the parties. The section and the rule mandates the communication of the order to the parties. Thus, the date of communication or knowledge, actual or constructive, of the orders sought to be rectified or amended under S. 254(2) of the Act becomes critical and determinative for the commencement of the period of limitation. (AY.2006-07)
Golden Times Services Pvt. Ltd. v. Dy. CIT (2020)422 ITR 102/ 107 CCH 0016/ 191 DTR 101/ 271 Taxman 123 (Delhi) (HC)
S. 254(2): Appellate Tribunal-Rectification of mistake apparent from the record – Duty of Tribunal to decide on merits – Appeal dismissed ex- parte for non prosecution- Granted liberty for recall of order – Application for recalling the order rejected on ground of limitation – Date of communication or knowledge, actual or constructive, of the orders sought to be rectified or amended under S. 254(2) of the Act becomes critical and determinative for the commencement of the period of limitation- Rejection of rectification is held to be not valid . [ S.254(1) ,Appellate Tribunal) Rules, 1963, R. 24 , 35 ]