TaxTMI 
TaxTMI 
2019 (8) TMI 794
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..... That the appellant craves to add, amend or alter any ground of appeal before or at the time of hearing of appeal, with the permission of the Hon'ble Income Tax Appellate Tribunal, Chandigarh. 2. The ld. AR Mr. Vineet Krishan appearing on behalf of the assessee submitted that the point at issue is fully covered in favour of assessee by virtue of the order of the jurisdictional High Court in the case of CIT Vs Hemla Embroidery Mills (P) Ltd., 2014) 366 ITR 167 (P&H). Inviting attention to page 2 and 3 of the assessment order it was submitted that there is no dispute that the payments have been made late in terms of the specific Acts, however, the fact that payments have been made before the due date of filing of the return is also an accepted fact. It was his submission that the ITAT Chandigarh Bench in its latest order dated 29.03.2019 in ITA 1243/CHD/2018 in the case of M/s New Time Contractors and Builder P.Ltd. Vs DCIT (copy filed) following the aforesaid decision of the jurisdictional High Court granted relief to the assessee on identical facts and circumstances. It was his submission that there is no contrary decision of the jurisdictional High Court. 3. The ld. Sr.....
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....the employees' State Insurance and provident fund as the contributions had been deposited prior to the filing of the return under section 139(1)." So respectfully following the ratio laid down by the Hon'ble Jurisdictional High Court in the aforesaid referred to case, the impugned addition made by the AO and sustained by the Ld. CIT(A) is deleted. (12) In the result the appeal of the assessee is allowed." 4.1 A perusal of the above order passed by the Co-ordinate Bench shows that ultimately the assessee relies on the decision of the jurisdictional High Court as opposed to the decision rendered by a non jurisdictional High Court relied upon by the Revenue. In order to put the legal principles in perspective, it will not be out of place to refer to the well understood legal position that the decision of the Apex Court in terms of Article 141 of the Constitution of India, not only as a matter of judicial discipline but as a constitutional mandate is a binding precedent for all Courts and Tribunals in the country. The said Article in unambiguous terms lays down that the law declared by the Supreme Court shall be binding on all Courts within the territory of....
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....a quasi judicial capacity, the discipline of such functioning demands that he should follow the decision of the Tribunal or the High Court, as the case may be". The Court in clear unambiguous terms held addressing the Assessing Officer that, "He cannot ignore merely on the ground that the Tribunal's order is the subject matter of revision in the High Court or the High Court's decision is under appeal before the Supreme Court." The Court held that, "Permitting him to take such a view would introduce judicial indiscipline, which is not called for even in such cases. It would lead to a chaotic situation". 4.2 In similar view, it would also be appropriate to refer to the decision of the Hon'ble Andhra Pradesh High Court in the case of State of A.P. v. CTO (1988) 169 ITR 564 (A.P) where the Court held that it is impermissible 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. Addressing these oft repeated pleas, the Court went on to clearly opine and hold that "If any authority or....
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....f the Hon'ble Gujrat High Court in the case of Air Conditioning Specialists Pvt. Ltd. vs. Union of India & Ors. (1996)221 ITR 739 (Guj.) where the said issue came up for consideration. The Court in unambiguous terms addressing the settled position held that the Commissioner of Income Tax is a "Tribunal" subject to the supervisory jurisdiction of the High Court under Article 227 of the Constitution. Hence, he is bound to obey the law declared by the High Court. The Court in clear terms held that it was not open to the Commissioner of Income Tax to ignore the decision of the jurisdictional High Court or refuse to follow it on the ground that the verdict had not been accepted by the Department and that the matter was carried further and was pending before the Supreme Court. The Court held that when a point is concluded by a decision of the Court, all subordinate courts and inferior Tribunals within the territory of the State and subject to the supervisory jurisdiction of the High Court are bound by it and must scrupulously follow the said decision in letter and spirit. 4.4 Similarly in CIT vs. G. Dalabhai & Co-226 ITR 922, the Hon'ble Gujarat High Court again recorded its angui....
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....xcept, however, the Supreme Court itself which is free to review the same and depart from its earlier opinion if the situation so warrants. WTiat is binding is, of course, the ratio of the decision and not every expression found therein. (b) The decisions of the High Court are binding on the subordinate courts and authorities or Tribunals under its superintendence throughout the territories in relation to which it exercises jurisdiction. It does not attend beyond its territorial jurisdiction. (c) The position in regard to the binding nature of the decisions of a High Court on different Benches of the same court, may be summed as follows : (i) A single judge of a High Court is bound by the decision of another single judge or a Division Bench of the same High Court. It would be judicial impropriety to ignore that decision. Judicial comity demands that a binding decision to which his attention had been drawn should neither be ignored nor overlooked. (ii) A Division Bench of a High Court should follow the decision of another Division Bench of equal strength or a Full Bench of the same High Court. If one Division Bench differs from another Division Be....
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....sing Officer is bound to follow the decision of the Tribunal particularly so in the case of the same assessee. This principle requires that decisions of higher authorities such as Tribunal should be followed by lower officers, viz., CIT(A) and Assessing Officer. Even decision of the Tribunal, not a jurisdictional Tribunal, is required to be followed by the lower authority. Sometimes, an argument is made and also put on record that the Department has not accepted the decision of the Tribunal and Appeal has been preferred to the High Court. The resort to such language has not met judicial approval. The Court has held unless the order of the higher authority is stayed in appeal, it operates as a valid binding decision to the lower authority not only in the case of the same assessee but also in other cases where the same law point is involved. Reference may also be made to the speaking observation of the Apex Court in the said decision addressing the binding precedent of higher Courts where the Court felt the need to hold that, "it cannot be too vehemently emphasized that it is of utmost importance that in disposing of the quasi-judicial issues before them, revenue officers are bound b....
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....x Court. The Apex Court held that in view of the decisions of the jurisdictional High Court on the said issue available on the date when the decision of the CIT(A), ITAT and the High Court were considered, the issue could not be said to be debatable the adjustment made by the Assessing Officer in terms of the binding precedent of the jurisdictional High Court was held to be permissible. It was held that as far as the Courts and Tribunal within the territorial jurisdiction of Gujrat High Court were concerned in the face of the binding precedents available in the decisions of the Gujrat High Court itself available on the issue in the case of Ahmedabad Mfg. & Calico (P) Ltd. Vs CIT (1986) 162 ITR 800 (Guj) and Alembic Glass Industries Ltd. V CIT (1993) 202 ITR 214 (Guj) the issue could be said to be well settled and there was no debate. For the purposes of the present order, the ratio of the decisions is not relevant, however for the sake of completeness, it may be noted that these decisions held that the nature of expenditure being contemplated by the Assessing Officer was a capital expenditure. In the circumstances, considering the fact that the registered office of the assessee in ....
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....eking quashing and setting aside of the order passed by CIT, Baroda. Their Lordships in the facts of the said case held ; We may, however, add that it was not open to the second respondent (CIT) to ignore the law laid down by this Court when it was an inferior tribunal subject to the supervisory jurisdiction of this Court. It was not proper on his part not to follow binding decision of this Court on the ground that the Department had not accepted that decision and had filed an appeal and the matter was pending in the Supreme Court. It cannot be disputed and is not disputed that the second respondent is a "tribunal" subject to the supervisory jurisdiction of this Court under Art. 227 of the Constitution. Hence, he is bound to obey the law declared by this Court. The apex Court of the country in no uncertain terms held that the law declared by a High Court is binding on all subordinate Courts and tribunals within the territory to which it exercises jurisdiction. In Bhopal Sugar Industry vs. ITO (1960) 40 ITR 618 (SC) : AIR 1961 SC 182, the ITO (subordinate authority) refused to carry out the clear and unambiguous directions of the Tribunal (superior authority). Depr....
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....ve tribunal can ignore the law declared by the highest Court in the State and initiate proceedings in direct violation of the law so declared. Under Art. 215every High Court shall be a Court of record and shall have all the powers of such a Court including the power to punish for contempt of itself. Under Art. 226, it has a plenary power to issue orders or writs for the enforcement of the fundamental rights and for any other purpose to any person or authority, including in appropriate cases any Government within its territorial jurisdiction. Under Art. 227, it has jurisdiction over all Courts and tribunals throughout the territories in relation to which it exercises jurisdiction. It would be anomalous to suggest that a tribunal over which the High Court has superintendence can ignore the law declared by the Court, and start proceedings in direct violation of it. If a tribunal can do so, all the subordinate Courts can equally do so, for there is no specific provision, just like in the case of Supreme Court, making the law declared by the High Court binding on subordinate Courts. It is implicit in the power of supervision conferred on a superior tribunal that all the tribunals subjec....