Recall power required to revisit merits despite s.129B(2) time-bar label; labels not decisive, matter remitted

SC held that the Tribunal erred by refusing to consider merits and by treating the application as time-barred under s.129B(2) of the Customs Act without exercising its inherent power to recall its own order. The Court held that labels on applications are not decisive and that where a tribunal has omitted to consider relevant contentions, it must revisit them to do justice; provisions of s.129B do not automatically preclude such exercise. Appeal allowed in favour of the assessee and matter remitted for consideration on merits.

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Issues: Whether the Tribunal erred in dismissing an application labelled as one for rectification of mistake on the ground of limitation without exercising its inherent power to recall or re-open its order and whether the matter should be heard afresh on merits.

Analysis: The issue required examination of whether an application that effectively sought review/recall of the Tribunal's order filed within a reasonable time and after the appellant had pursued remedies before higher fora could be entertained despite the limitation bar in Section 129B. The reasoning applied the principle that tribunals possess ancillary inherent powers to recall or set aside their own orders where a mistake or failure to consider contentions is shown and where justice so requires. It was noted that judges' records are final but where material contentions were not considered, the appropriate authority must be permitted to consider them. Authorities recognising inherent jurisdiction to set aside ex parte or final orders within a limited timeframe and the primacy of natural justice in ensuring disputes are decided on merits were treated as applicable. The label of the application was held not to be decisive; the Tribunal was required to look at substance and to hear the applicant on merits if the application was filed within reasonable time and prima facie made out.

Conclusion: The Tribunal acted incorrectly in treating the application as barred by limitation without exercising its inherent power to recall or re-open its order and without considering the merits; the matter is to be remitted to the Tribunal to be heard afresh on the application.

Ratio Decidendi: A tribunal has inherent power to recall or re-open its own order and must, in the interest of justice, consider an application filed within a reasonable time that prima facie shows that material contentions were not considered, notwithstanding the limitation bar in the statute, and the substantive label of the application is subordinate to its substance.

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