section 254(2) of the Act

[murali Krishnamurthy]

A miscellaneous application (MA) was filed in 1999. Due to various reasons attributable to the Tribunal and the appellant the MA could not be heard and disposed off. One of the major reasons id the creation of  a new bench and the time taken for transfer of appeals from one location to another and also that the members could not be arranged to constitute  a regular Bench.
Ultimately, at the time of hearing,in December 2007, the present Bench has pointed out that as four years have lapsed, the Bench would not be able to adjudicate on the issue.However, it was magnanimous to state that in the interest of justice, it would hear the MA if there is any case law on the subject that the Tribunal has inherent power to hear even after the lapse of four years.

Please help with relevant case law in this regard

CA Murali Krishna Murthy

[ashutosh majumdar]

Hi Mr. Murthy,

There is a CBDT circular in the context of s. 154 that if an application is filed within time and the AO cannot pass the order within the time limit, the time limit is relaxed and the AO must pass the order.

There is also a judgement of the Bombay High Court that the AO cannot take advantage of his own default. There is also an Allahabad Court precedent on the issue.

These principles may also apply to s. 254(2). I will pull out the citations tommorow and post it.

Ashutosh.

[ashutosh majumdar]

As promised, herewith are the case laws:

There is a judgement in Harshvardhan Chemicals 256 ITR 767 on the point. Also, in the context of s. 256(1) (which imposed a time limit) it was held that the limit is directory and not mandatory. (See Duncan 28 ITR 427, Bejoykumar 24 ITR 70 - affirmed by SC in 32 ITR 466.

In the context of s. 154 the Bombay High Court has held that the dept cannot take advantahe of its own default in Scindia Investment 190 ITR 218. The same view is taken in Vithaldas 71 ITR 204 (All) and in Alipurduar Tea 112 ITR 878 (Cal).

The CBDT Circular on s. 154 is circular no. 73 dated 7.1.1972.

Hope this helps ur case.

Ashutosh.

[murali Krishnamurthy]

Dear Mr. Asutosh,

Thanks for the prompt reply.

However, I am given to understand that the ITAT has given decisions on this subject. I am not sure whether the same are 
reported are not. One of them is a SB decision. Can you take the efforts to trace the same and inform. I have the MP posted on
08.02.2008. Also any other unreported decisions.

Thanking you, in anticipation,

CA Murali krishnamurthy

[ashutosh majumdar]

Sorry my reaearch has thrown up a blank so far. But I am still on the case. Give me a day or two.

Ashutosh.