Question And Answer | |
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Subject: | CIT(A) order can rectified |
Category: | Income-Tax |
Querist: | CA Amol Madiwal |
Answered by: | Mr .Ganesh Purohit, Senior Advocate |
Tags: | CIT(A) order can rectifiedCIT(A) order can rectified, Rectification of Mistake apparent from the record, Section 154 of the Income Tax Act |
Date: | August 8, 2024 |
Does the failure of the CIT(A) to consider binding jurisdictional High Court decisions constitute a mistake apparent from the record, eligible for rectification under Section 154 of the Income Tax Act?
If the judgement of the jurisdictional High Court is brought to the notice of the bench and not followed it certainly is a mistake apparent from the record rectifiable under section 154 of the IT Act.
(i) COMMISSIONER OF INCOME TAX vs. MALI RAM VERMA (2003) 185 CTR (Raj) 539 : (2003) 131 TAXMAN 518 (Raj)
(ii) COMMISSIONER OF INCOME TAX vs. RAM LAL BABU LAL (1998) 234 ITR 776 (P&H) : (1998) 148 CTR (P&H) 643 : (2000) 109 TAXMAN 177 (P&H)
(iii) KASHMIR STEEL ROLLING MILLS vs. DEPUTY COMMISSIONER OF INCOME TAX*
(2018) 195 TTJ (Asr) 125 : (2018) 169 DTR_Trib (Asr)(Trib) 137 | ITAT, AMRITSAR BENCH
Rectification—Mistake apparent—Assessment order inconsistent with decision of the Supreme Court—Once there is a binding decision by the apex Court, any order by any Court subordinate to it inconsistent therewith would constitute a mistake rectifiable under s. 154—Supreme Court has upheld the decision of the jurisdictional High Court holding that excise duty refund given in pursuance of a scheme of the Government is a capital receipt—Therefore, the order of the AO refusing to treat the excise duty refund as capital receipt is vitiated by a mistake rectifiable under s. 154 Though there is no express provision in the Constitution like Article 141, in respect of the High Courts, the Tribunals within the jurisdiction of a High Court are bound to follow its judgments as the High Court has the power of superintendence over them under article 227 of the Constitution. The Hon’ble Supreme Court in East India Commercial Co. Ltd. v. Collector of Customs AIR 1962 SC 1893 observed – “We therefore, hold that the law declared by the highest court in the state is binding on authorities or Tribunals under its superintendence and they cannot ignore it.” This view has been reiterated in Baradakanta Mishra v. Bhimsen Dixit AIR 1972 SC 2466. In view of the same it is clear beyond doubt that judgments of the High Courts are binding on subordinate courts, tribunals and the authorities functioning within the territorial jurisdiction of the High Court. The Hon’ble A. P. High Court went a step further in State of A. P. v. CTO (1988) 169 ITR 564 (AP) (HC), where it pronounced that it is not permissible for the authorities and the Tribunals to ignore the decisions of the High Court or to refuse to follow the decisions of the High Court on the pretext that an appeal is pending in the Supreme Court or that steps are being taken to file an appeal.
East India Commercial Co Ltd v. Collector of Customs (1963 ) 3 SCR 338/ AIR 1962 SC 1893
“ We , therefore , hold that the law declared by the highest court of State is binding on the authorities or Tribunals under its superintendence , and that they cannot ignore it either in initiating proceedings or deciding on the rights involved in such proceedings . If that be so, the notice issued by the authority signifying the launching of proceedings contrary to the law laid down by the High Court would be invalid and the proceedings themselves would be without jurisdiction “
UOI v. Kamalakshi Finance Corporation Ltd 1992 taxmann.com 16/ 1991 (55) E.L.T. 433 (SC) held that “ The adjudicating officer acts as a quasi judicial authority . He is bound by the law of precedent and binding effect of the order passed by the higher authority or Tribunal or superior jurisdiction . If his order is thought to be erroneous by the Department , the Department can as well prefer appeal in terms of the statutory provisions , contained in the Central Excise , Act 1944. “
The assessee should make an rectification before the CIT(A). In case the rectification application is rejected the assessee can file writ before the High Court .