Pacific Projects Ltd. v. ACIT (2021)430 ITR 522/ 278 Taxman 396/ 198 DTR 129/ 319 CTR 333 (Delhi)(HC)

S. 254(2) : Appellate Tribunal-Rectification of mistake apparent from the record-Ex Parte order-Limitation-Notice was not served though change of address was intimated-Rejection of application for recall of order on ground of bar of limitation-Order quashed and set aside-Matter remanded to Tribunal. [S. 253, 254(1), Art. 226]

The assessee filed an application under section 254(2) of the Act, for recall of the ex parte order remanding the matter to the Assessing Officer to decide the matter afresh after examining all the documents, including additional evidence as well as books of account, bills and vouchers, etc. The Tribunal held that it had no power to condone the delay in filing the application under section 254(2) as the assessee had filed the application after six months from the end of the month in which the ex parte order had been passed. On a writ petition contending that the assessee had changed its address and shifted to new premises and this fact was mentioned in the appeal filed by the assessee in form 35 against the order passed by the Dy Commissioner and the assessee was never served in the appeal filed by the Department before the Tribunal. On writ allowing the petition, that the course adopted by the Tribunal at the first instance, by dismissing the appeal for non-prosecution, and then refusing to entertain the application. The assessee was never served in the appeal filed by the Department before the Tribunal. The Tribunal had erroneously concluded that the miscellaneous application filed by the assessee was barred by limitation under section 254(2) inasmuch as the assessee had filed the application within six months of actual receipt of the order. If the assessee had no notice and no knowledge of the order passed by the Tribunal, the limitation period would not start from the date the order was pronounced by the Tribunal. The order dismissing the application filed by the assessee under section 254(2) was quashed and on the facts the ex-parte order whereby the matter was remanded to the Assessing Officer was set aside. The Tribunal was directed to hear and dispose of the appeal on the merits.