Commissioner of Income Tax Vs. Income Tax Appellate Tribunal and anr. - Court Judgment

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head note: income tax reference--general principle--limitation. ratio: in the circumstances of the case, tribunal's order dismissing revenue's reference application under section 256(1) on ground of limitation suffered from an error of law apparent on face of it, therefore, same was liable to be quashed. held: the letter dated 1-7-1992 clearly shows that as per the assistant commissioner, the records of the assessee were transferred to the ito, ward-2, faridabad, on 13-5-1992 and not on 13-6-1992 as assumed by the tribunal. after having seen the date in the lettter dated 1-7-1992 with magnifying glass, court is convinced that it is 13-5-1992 and not 13-6-1992 as observed by the tribunal. it is, thus, clear that even before the service of order dated 10-4-1992 upon the commissioner, records of the assessee had been transferred to the income tax officer, and, therefore, it was the duty of the tribunal to have served the order dated 10-4-1992 on the appropriate officer. admittedly, the order was served upon the concerned commissioner on 31-7-1992 and from that date the application filed on 23-9-1992 was within limitation. therefore, the order of tribunal suffers from an error of law apparent on the face of it and the same is liable to be quashed. application: also to current assessment years. dt. ord.: 17-5-1996 a. y.: 1983-84 income tax act 1961 s.256 - g.s. singhvi, j. :this petition has been filed to quash orders annexures p1 and p4 passed by the tribunal.2. for the asst. yr. 1983-84, the ao passed order dt. 23rd may, 1987 and directed addition of various sums. aggrieved by the order of the ao, respondent no. 2 filed appeal before the cit, new delhi who dismissed the same vide order annexure p3. further appeal filed by the assessee before the tribunal, delhi bench d, new delhi was allowed by the tribunal vide annexure p4 dt. 10th april, 1992. thereafter, the petitioner filed an application under s. 256(1) of the it act, 1961 (for short, the act) for reference of two questions of law formulated by it. that application came to be dismissed by the tribunal vide its order dt. 14th dec., 1992 on the ground that the application is time-barred.aggrieved by the order of the tribunal, the petitioner filed a petition under s. 256(2) of the act, but, on realising that the petition under s. 256(2) will not be maintainable, the petitioner sought the permission to withdraw, itc no. 107 of 1993 with liberty to file a writ petition. this prayer of the petitioner was accepted by the high court as would appear from annexure p5 dt. 9th dec., 1993. after about three months, the petitioner instituted this writ petition and made prayer as aforementioned.3. the only point urged by shri sawhney, senior advocate appearing for the petitioner, is that the tribunal has committed a serious illegality in dismissing the application of the petitioner on the ground of bar of limitation. shri sawhney submitted that the tribunal has proceeded under a wrong assumption that the case was with the cit, new delhi, till 13th june, 1992 and the record was transferred to the ito, ward no. 2, faridabad on 13th june, 1992. shri sawhney submitted that the record had been transferred to the ito, ward no. 2, faridabad on 13th may, 1992 and not on 13th june, 1992 as mentioned in the order of the tribunal and, therefore, order annexure p1 should be quashed on the ground that it suffers from an error of law apparent on the face of it. shri sawhney further submitted that the order passed by the tribunal on 10th april, 1992 was sent to the cit-v new delhi and the said cit returned the same on 1st july, 1992 whereafter it was sent to the office of the cit, rohtak on 27th july, 1992 and within sixty days of the receipt thereof in the office of the petitioner i.e., 31st july, 1992, the application was filed by the petitioner under s. 256(1) of the act and, as such, the same could not have been dismissed as time-barred. shri sawhney pointed out that the cit-v, transferred the record of the assessee to the ito, ward-2, faridabad and, therefore, the period of limitation should have been counted from the date of the receipt of the order by the cit, rohtak.4. shri mittal, learned counsel appearing for the respondent-assessee, argued that as against the order dt. 14th dec., 1992, the writ petition is highly belated because no explanation has been offered by the petitioner for the delay of over one year and three months in the filing of the petition after passing of the impugned order. learned counsel further argued that cit-v, new delhi transferred the record on 13th june, 1992 and as the order was served upon the said cit on 14th may, 1992, the application for reference could have been filed upto 13th july, 1992 only and as it was filed on 23rd sept., 1992, the tribunal is right in rejecting the same as barred by limitation. shri mittal further argued that the cit-v, delhi had the jurisdiction at the time of decision and, therefore, the service of order on cit-v, new delhi was valid and transfer of the case at a subsequent point of time to the ito, ward-2, faridabad could not in any manner stop running of period of limitation.5. insofar as order annexure p4 is concerned, we are of the opinion that it is neither proper nor just for us to make adjudication about the legality of that order because we are primarily concerned with the legality of order passed by the tribunal on an application filed by the petitioner under s. 256(1) of the act. a perusal of annexure p1 shows that the application filed by the petitioner under s. 256(1) has been rejected on the ground that it is barred by time. in taking this view, the tribunal has placed reliance on the letter dt. 1st july, 1992 written by the asstt. cit, (judicial)-v, new delhi, to the registrar, tribunal and observed that jurisdiction of the case was with cit-v, new delhi till 13th june, 1992 and as the order was conveyed to the said authority on 14th may, 1992, it was the duty of the cit delhi-v, to file application and there was no justification for it to wait till 1st july, 1992 when the record was returned to the tribunal with an intimation that the records were transferred to the ito, ward-2, faridabad w.e.f. 13th june, 1992.6. we have carefully gone through the photostat copy of the letter dt. 1st july, 1992 which shri sawhney produced before us during the course of arguments. this letter clearly shows that as per the asstt. cit (judicial)-v, new delhi, the records of the assessee were transferred to the ito, ward-2, faridabad on 13th may, 1992 and not on 13th june, 1992 as assumed by the tribunal. after having seen the date in the letter dt. 1st july, 1992 with magnifying glass, we are convinced that it is 13th may, 1992 and not 13th june, 1992 as observed by the tribunal. it is, thus, clear that even before the service of order dt. 10th april, 1992 upon the cit, delhi-v, records of the assessee had been transferred to the ito, ward-2, faridabad and, therefore, it was the duty of the tribunal to have served the order dt. 10th april, 1992 on the appropriate officer. admittedly, the order was served upon the concerned cit on 31st july, 1992 and from that date, the application filed on 23rd sept., 1992 was within limitation. we, therefore, hold that order annexure p1 suffers from an error of law apparent on the face of it and the same is liable to be quashed.7. the argument of shri mittal that the cit, delhi-v had the jurisdiction in the first instance and, therefore, it continued to have jurisdiction cannot be accepted for supporting the impugned order because the tribunal has not dismissed the application filed by the petitioner on that ground.8. the argument of shri mittal regarding delay and laches is wholly meritless. the petitioner had earlier filed itc no. 107 of 1993. that was withdrawn on 9th dec., 1993 and within three months thereafter the petitioner filed the present writ petition. it cannot, therefore, be said that the petitioner is guilty of laches and on that ground this petition cannot be dismissed.9. for the reasons mentioned above, we allow the writ petition and quash order annexure p1. tribunal, delhi-d, new delhi, is directed to hear and decide on merits the application filed by the petitioner under s. 256(1) of the act.