TaxTMI 
TaxTMI 
2024 (5) TMI 224
X X X X Extracts X X X X
X X X X Extracts X X X X
....n 254(2) of the Income Tax Act, 1961 (for short 'the Act') in Misc. Application preferred by the petitioner being M.A. No. 100/Ahd/2022 in ITA No. 445/Ahd/18 in Special Civil Application No. 20400/2023, M.A. No. 97/Ahd/2022 in ITA No. 2089/Ahd/2013, M.A. No. 99/Ahd/2022 in ITA No. 1751/Ahd/2016. 4. Brief facts of the case in all the three petitions are of the same assessee pertaining to the three different assessment years. Therefore, the same are heard together and are being disposed of by this Common order. 5. For the sake of convenience, facts of Special Civil Application No. 20400/2023 is considered as lead case. The petitioner-Company is owned by the Government of Gujarat carrying on business of distribution of electricity. 5.1 For the Assessment Year 2013-14, the petitioner filed return of income on 30.09.2013 declaring total income of Rs. Nil after claiming set off of brought forward business loss and unabsorbed depreciation. 5.2 The case of the petitioner was selected for scrutiny assessment by issuing notice dated 04.09.2014 under section 143(2) and final assessment order was passed under section 143(3) of the Act on 29.12.2016. The Assessing Officer, while fra....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cide afresh in light of the judgment of this Court dated 16.03.2020 in case of Gujarat Urja Vikas Nigam Ltd vs. DCIT (supra) in Tax appeal No. 63/2020. It was therefore, submitted by the petitioner that such mistake has crept into order passed by the Tribunal which is a mistake apparent from record. 5.4 However, the Tribunal by impugned order dated 17.05.2023 dismissed the Misc. Application No. 100/2022 stating that the petitioner is seeking review of the order dated 24.08.2022 which is not permissible under section 254(2) of the Act as the Tribunal has limited power of rectifying the mistake apparent from record. 6. Learned advocate Mr. Manish J. Shah for the petitioner submitted that the Tribunal ought to have considered the facts of the case in light of the decision of this Court relied upon by the petitioner at the time of hearing as the Tribunal has not been able to show as to how there is no mistake apparent on record as pointed out by the petitioner by relying upon the decision of Orissa High Court with regard to aspect of interest on staff loan as to whether the interest on staff loan is business income or not. 6.1 It was therefore submitted that the issue as to wh....
X X X X Extracts X X X X
X X X X Extracts X X X X
....pears that it is not in dispute that the petitioner has relied upon the decision of this Court in case of Gujarat Urja Vikas Nigam Ltd vs. DCIT in Tax Appeal No. 63/2020 wherein, the Tax Appeal was preferred by the Revenue on the aspect as to whether interest received on staff loan is business income or not for the purpose of consideration of disallowance under section 14A of the Act. The facts of the case of Gujarat Urja Vikas Nigam Ltd vs. DCIT and the facts of the case of the petitioner are identical and not different and as such, the Tribunal could not have relied upon the decision of Orissa High Court while distinguishing the facts of the case of the petitioner by ignoring the decision of the Jurisdictional High Court. More particularly, when the CIT and the Tribunal in case of the Gujarat Urja Vikas Nigam Ltd vs. DCIT have held that interest income on staff loans is required to be treated as 'business income' instead of 'income from other sources' which is confirmed by this Court in the aforesaid Tax Appeal. 9. In case of Gujarat Energy Transmission Corporation Ltd (supra) in ITA No. 633/2013, the Coordinate Bench of the Tribunal, after considering the decision of this Cou....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rify the same in light of decision of Hon'ble Gujarat High Court in case of Gujarat Urja Vikas Nigam Ltd vs. CIT vide Tax Appeal No. 63/2020 order dated 16.03.2020. The Ld. AR also relied upon the decision of the Tribunal in case of DCM Estates and Infrastructure Ltd vs. DCIT (2007) 110 TTJ 604 (Del. Tri). 9. The Ld. DR relied upon the assessment order and the order of the CIT(A). 10. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the Hon'ble Gujarat High Court in case of Gujarat Urja Vikas Nigam Ltd (Supra) has categorically held that the interest earned on loan and advances from deposits with Mega Power Project towards SITS sharing and power are directly related to business of the assessee. But the said component does not include interest on staff loan and advances. The decision in case of Odisha Power Generation Corporation Ltd (supra) has also not specifically mentioned the nomenclature of interest on staff loan and advances to the staff. Though the contentions of the assessee therein were quoted by the Hon'ble Orissa High Court but whether the same was accepted or not is not mentioned in ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of interest on staff loans whether business income or not. The view taken by the Tribunal is independent view after considering the decisions of the Hon'ble Gujarat High Court and the Hon'ble Orissa High Court and the Delhi Tribunal. The Tribunal has categorically noted the distinction on facts that in the said cases the interest earned on staff loan/advances was treated as business income noting the fact that they were given as mandatory incentives. This fact being not demonstrated in the present case, therefore, all these decisions were held to be not applicable in the present case. This cannot be termed as mistake apparent from record as the decisions cited by the Ld. AR were adjudicated and considered while expressing the view by the Tribunal in order dated 24.08.2022 and applicability of the decision of the Hon'ble Orissa High Court has also been taken into account after expressing our view. The ITAT has a limited scope/power of rectifying the mistake apparent from record within the meaning of section 254(2) of the Act. At this juncture, the assessee is seeking review of the order dated 24.08.2022 passed by the Tribunal which is not as per the provisions of section 254(2) of t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he position will be a fortiori with regard to a question of fact. If the Tribunal wants to take an opinion different from the one taken by an earlier Bench, it should place the matter before the President of the Tribunal so that he could have the case referred to a Full Bench of the Tribunal consisting of three or more members for which there is provision in the Income-tax Act itself". We are in respectful agreement with the aforesaid view. 14. Thus, in view of the above, when the Tribunal has not followed the decision on the identical facts by the Coordinate Bench which is confirmed by this Court, there is mistake apparent on the record which ought to have been considered by the Tribunal when it is pointed out being a mistake apparent on record. The Hon'ble High Court in case of Air Conditioning Specialities (P.) Ltd. Vs. Union of India reported in (1996) 221 ITR 739 (Guj) has held as under: "Having given anxious and thoughtful consideration, we are of the opinion that petition requires to be allowed. It is not disputed even by the Revenue that the point is concluded by a pronouncement of this court in the case of Bharat Textile Works [1978] 114 ITR 28. Mr. Th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....at it cannot be said that "a condition of the licence amounted to an order under the Act" and, therefore, no offence was committed by the company. The High Court also passed an order directing the seized/goods to be sold and the sale proceeds to be deposited in the court. After those proceedings, a notice was issued by the Collector on the company to show cause why the amount should not be confiscated and penalty should not be imposed. It was contended on behalf of the company that once the High Court decided that the breach of condition of licence could not be said to be a breach of order, the Collector had no jurisdiction to issue show-cause notice. It was submitted that the decision of a High Court on a point was binding on all subordinate courts and inferior Tribunals within its territorial jurisdiction. The notice was, therefore, liable to be quashed. The precise question before the Supreme Court was as to whether or not the decision rendered by a High Court would bind all subordinate courts and inferior Tribunals within its territorial jurisdiction. It was argued that there was no provision similar to article 141 of the Constitution making the law declared by a High ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... be upheld. It is not even the case of the Department that the decision of this court in Bharat Textile Works' case [1978] 114 ITR 28 has been stayed by the Supreme Court. Hence, so far as this court is concerned, the point is concluded. It is settled law that unless and until the decision is reversed by a superior court, it holds the field. It also cannot be gainsaid that the second respondent is an inferior Tribunal subject to supervisory jurisdiction of this court and this court can exercise jurisdiction over him by invoking article 227 of the Constitution. In our considered view, therefore, it was not open to the second respondent to ignore the decision of this court or to refuse to follow, it on a specious plea of verdict being not accepted by the Department and that the matter was carried further and was pending before the Supreme Court. In Baradahanta Mishra v. Bhimsen Dixit, AIR 1972 SC 2466, when a member of the superior judicial service functioning as the Commissioner of Hindu Religious' Endowments, Orissa, refused to follow the decision of the High Court, contempt proceeding had been initiated against him and he was punished by the High Court. W....