TaxTMI 
TaxTMI 
2024 (7) TMI 881
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....10/2022 has decided the controversy in favour of the department after observing and holding as under:- "54. In the opinion of this Court, the reasoning in the impugned judgment that the non-obstante clause would not in any manner dilute or override the employer's obligation to deposit the amounts retained by it or deducted by it from the employee's income, unless the condition that it deposited on or before the due date, is correct and justified. The non-obstante clause has to be understood in the context of the entire provision of Section 43B which is to ensure timely payment before the returns are filed, of certain liabilities which are to be borne by the assessee in the form of tax, interest payment and other statutory liability. In the case of these liabilities, what constitutes the due date in defined by the statute. Nevertheless, the assessees are given some leeway in that as long as deposits are made beyond the due date, but before the date of filing the return, the deduction is allowed. That however, cannot apply in the case of amounts which are held in trust, as it is in the case of employees' contributions- which are deducted from their income. They are n....
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.... of the Act in light of the subsequent judgment of the Hon'ble Supreme Court, that the Tribunal order not only should be recalled but should be decided in line with the subsequent judgment of the Hon'ble Supreme Court and therefore, it is a mistake apparent from record which deserves to be rectified and recalled within the scope and ambit of section 254(2) of the Act. 5. The brief facts are that assessee has filed its return of income for A.Y.2019-20 u/s. 139(1) on 02/10/2019. The CPC while processing the return had made disallowance of Rs. 1,74,09,948/- on account of delay in deposits of employee's contribution towards provident fund and ESIC, beyond the due date of the respective Acts. Against the disallowance made by the CPC u/s. 143(1), assessee had preferred appeal before the ld. CIT(A) on the following ground:- "The appellant had received employees' contribution to Provident Fund (PF and ESI) and from the total contribution received a part of funds i.e. Rs. 1,74,09,948/-was deposited by the appellant after the due date of the respective act but before the due date of filling of return as per section 139(1) of the Income Tax Act, 1961. The appellant did not fai....
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....1 taxmann.com 192, it was held that since the Commissioner has not examined the merits of the assessee's case, the revision petition is placed back to the Commissioner for disposal on merits. It is noticed that all payments towards employee's contribution to the PF were made before the due date of the filing of the return. If that be so, surely, the Commissioner would be guided by the decision of this Court on the relevant issue namely - CIT v. Ghatge Patil Transport Ltd. 2. Commissioner of Income-tax, (Central), Pune v/s Ghatge Patil Transports Ltd. (Bombay High Court) [2015] 53 taxmann.com 141 (Bombay), it was held that no distinction is to be made between employer & employee's contribution to PF & the business deduction can be allowed as per the provisions mentioned in Section 438 of the Act & can be allowed if payment is made before the due date of furnishing the return of income. 3. High Court Of Bombay in the case of Commissioner of Income-tax^4, Mumbai v. Hindustan Organics Chemicals Ltd [2014] 48 taxmann.com 421 (Bombay). The matter was in Supreme Court and the SLP has been dismissed as the department has subsequently withdrawn the appeal due t....
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....e assessee that once the matter has attained finality, then based on subsequent judgment of a Higher Court, cannot be the ground to recall or to review the order within the scope and ambit of Section 254(2). 10. Subsection 2 to Section 254 reads as under:- "254. (1) The Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit", (1A)[[***] (2) The Appellate Tribunal may, at any time within [six months from the end of the month in which the order was passed], with a view to rectifying any mistake apparent from the record, amend any order "passed by it under sub-section (1), and shall make such amendment if the mistake is brought to its notice by the assessee or the "[Assessing] Officer: Provided that an amendment which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this sub-section unless the Appellate Tribunal has given notice to the assessee of its intention to do so and has allowed the assessee a reasonable opportunity of being heard: 11. Thus, the scope is of rec....
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.... which, after the exercise of due diligence was not within his knowledge or could not be produced by him at the time when the decree was passed or order made, or on account of some mistake or error apparent on the face of the record, or for any other sufficient reason, desires to obtain a review of the decree passed or order made against him, may apply for a review of judgment to the Court which passed the decree or made the order. (2) A party who is not appealing from a decree or order may apply for a review of judgment notwithstanding the pendency of an appeal by some other party except where the ground of such appeal is common to the applicant and the appellant, or when, being respondent, he can present to the Appellate Court the case on which he applies for the review. [Explanation. The fact that the decision on a question of law on which the judgment of the Court is based has been reversed or modified by the subsequent decision of a superior Court in any other case, shall not be a ground for the review of such judgment.] 13. Ergo, the Explanation clearly envisages that the decision on a question of law on which judgment of the Court is based has been rever....
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....SIC should be made before the due date in respective Act for reduction, but that does not lead to an inference that where the matter had already attained finality and there is no appeal pending, then the subsequent judgment of the Hon'ble Supreme Court cannot be the ground for recalling of the matter as held by the Constitutional Bench of the Hon'ble Supreme Court. If the Revenue was aggrieved, then appeal should have been filed before the Hon'ble High Court. The judgment of the Hon'ble Supreme Court will apply in all the cases where the lis or cases are pending before any Court or forum. But once the issue in the appeal has attained finality following the earlier binding precedence of Jurisdictional High Court and there is no lis pending, and then based on subsequent judgment of a superior Court do not alter the finality of the judgment. If the Revenue's contention is to be accepted, then whenever a judgment is reversed by a higher Court or by any Constitutional Court subsequently in some different case, then all the appeals and matters which have been decided following the earlier order of the Constitutional Courts / High Court or Supreme Court does not mean that all such orders ....
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....ent reason, desires to obtain a review of the decree passed or order made against him, may apply for a review of judgment to the Court which passed the decree or made the order. Explanation - The fact that the decision on a question of law on which the judgment of the Court is based has been reversed or modified by the subsequent decision of a superior Court in any other case, shall not be a ground for the review of such judgment." 8. The explanation is also in the nature of an exception. In other words, the Explanation being in the nature of a proviso is a qualifying or an exception to what is stated in Order XLVII Rule 1 CPC which states the grounds for seeking a review. Hence, the object and intendment of the Explanation must be given its full effect. The object and purpose of the Explanation can be related to the following three maxims: (i) Nemo debet bis vexari pro una et eadem causa (No man should be vexed twice for the same cause); (ii) Interest reipublicae ut sit finis litium (It is in the interest of the State that there should be an end to a litigation); and (iii) Res judicata pro veritate occipitur (A judicial decision must be....
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....ited and Others in Miscellaneous Application No.414 of 2023 in Civil Appeal No.11857/2016 alongwith various other Miscellaneous Applications had elaborated this entire law and review based on subsequent judgment of the Hon'ble Supreme Court and interpreting Rule 1 of order XLVII of CPC specifically the scope of Explanation in Rule 1 as incorporated above. 39. Order XVLII does not end with the circumstances as section 114, CPC, the substantive provision, does. Review power under section 114 read with Order XLVII, CPC is available to be exercised, subject to fulfilment of the above conditions, on setting up by the review petitioner any of the following grounds: (i) discovery of new and important matter or evidence; or (ii) mistake or error apparent on the face of the record; or (iii) any other sufficient reason. 40. Insofar as (i) (supra) is concerned, the review petitioner has to show that such evidence (a) was actually available on the date the court made the order/decree, (b) with reasonable care and diligence, it could not be brought by him before the court at the time of the order/decree, (c) it was relevant and material for a decisio....
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....tention that the judgment sought to be reviewed was overruled in another case subsequently is no ground for reviewing the said decision. Explanation to Order XLVII Rule 1 of the Code of Civil Procedure clearly rules out such type of review proceedings. 50. Reference may next be made to the decision in Union of India v. Mohd Nayyar Khalil30. There, the impugned order had followed a three-Judge Bench judgment of this Court. Such judgment was admittedly pending consideration before a Constitution Bench. Taking note of such facts, it was held that: "2. *** Even if the question regarding the legality of the said three-Judge Bench decision is pending scrutiny before the Constitution Bench the same is not relevant for deciding the review petition for two obvious reasons - firstly, this was not pointed out to the Bench which decided the civil appeal; and secondly, by the time the impugned order was passed the three-Judge Bench judgment had not been upset and even in future if the Constitution Bench takes a contrary view it would be a subsequent event which cannot be a ground for review as is clear from the explanation to Order 47 Rule 1(2) of the Code of Civil Procedure *....
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.... corrected in the guise of exercise of power of review. (vi) A decision/order cannot be reviewed under Section 22(3)(f) on the basis of subsequent decision/judgment of a coordinate or larger Bench of the tribunal or of a superior court. (vii) While considering an application for review, the tribunal must confine its adjudication with reference to material which was available at the time of initial decision. The happening of some subsequent event or development cannot be taken note of for declaring the initial order/decision as vitiated by an error apparent. (viii) Mere discovery of new or important matter or evidence is not sufficient ground for review. The party seeking review has also to show that such matter or evidence was not within its knowledge and even after the exercise of due diligence, the same could not be produced before the court/tribunal earlier." (emphasis supplied) 53. This Court, in Subramanian Swamy v. State of Tamil Nadu33, has read the Explanation as follows: "52. *** The Explanation to Order XLVII, Rule 1 of Code of Civil Procedure 1908 provides that if the decision on a question of law on which the judgmen....
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.... The vires of the Explanation not being under challenge during more than four decades of its existence, it is not for the Court to ignore the Explanation. Xxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxx 104. We, thus, hold that no review is available upon a change or reversal of a proposition of law by a superior court or by a larger Bench of this Court overruling its earlier exposition of law whereon the judgment/order under review was based. We also hold that notwithstanding the fact that Pune Municipal Corporation (supra) has since been wiped out of existence, the said decision being the law of the land when the Civil Appeals/Special Leave Petitions were finally decided, the subsequent overruling of such decision and even its recall, for that matter, would not afford a ground for review within the parameters of Order XLVII of the CPC. (Emphasis added) The aforesaid judgment of the Hon'ble Supreme Court had elaborately dealt the issue of power to rectify error and power to review and after referring to catena of decisions of the Hon'ble Supreme Court categorically held that, if the judgment has been passed by the Court following another judg....
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.... the ITAT was right in exercising the powers under sub-section (2) of Section 254 on the ground that there was a mistake apparent from record committed by the Tribunal while deciding the appeal and whether it could have recalled the earlier order of the Tribunal on that ground. Thus, the core issue was, whether non-consideration of a decision of the Jurisdictional High Court or of the Hon'ble Supreme Court which was already existing at that time when the judgment was rendered by the Tribunal can be stated to be mistake apparent from the record. The Hon'ble Supreme Court upheld that the Tribunal was right in holding that it was a mistake which can be said to be mistake apparent from the record which could be rectified u/s. 254(2). There was no such principle which has been laid down that if after passing of the order of the Tribunal which has attained finality between the parties and in subsequent judgment is rendered by the superior Court, the same should also be recalled within the scope of Section 254(2). Though the Hon'ble Supreme Court had referred to a decision of Gujarat High Court in the case of Suhrid Geigy Ltd vs. Commissioner of Surtax reported in (1999) 237 ITR 834 that ....