2025 (7) TMI 766

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....al ("ITAT"), invoking powers under Section 254(2) of the Income Tax Act, 1961 (the "IT Act"), as well as the order dated 26th October, 2023 giving effect to the order passed under Section 254(2). 3. The short ground on which the order dated 4th August, 2023 is assailed is that there was no error apparent on the face of record for the Tribunal to invoke the jurisdiction under Section 254(2) of the IT Act. 4. Before we examine this aspect, it would be appropriate to set out some brief facts of the matter. In the present case, initially, the Assessing Officer made a disallowance of Rs.24.74 lakhs in the intimation under Section 143 (1) of the Act on the ground that the Assessee had deposited the employee's share of EPF and ESI etc., belatedl....

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.... down in the Nipso polyfabriks Ltd., (supra)]. 6. In light of this decision of the Hon'ble Supreme Court, and which was rendered on 12th October, 2022, the Revenue moved a Rectification Application before the ITAT by invoking the provisions of Section 254(2) of the IT Act. It is in this Rectification Application that the impugned order is passed, wherein the Tribunal has allowed the Miscellaneous Application filed by the Revenue, and holding that the disallowance made by the Assessing Officer is sustained. 7. The only ground on which the Rectification is allowed is on the basis of the judgment of the Hon'ble Court in Checkmates Services (supra). As mentioned earlier, this judgment was rendered by the Hon'ble Supreme Court on 12th October....

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....es (supra). The Division Bench, after examining the law on the subject, came to the conclusion that the Tribunal was in patent error in exercising jurisdiction under Section 254(2), and passing the impugned order. The relevant portion of this decision read thus:- 14. In our clear opinion, the question would be required to be answered against the Revenue and in favour of the assessee. The reasons for which we discuss hereunder. In such context, at the outset, we may observe that the petitioner had succeeded before the Tribu12 ptnal on the basis of the position in law as it prevailed on the day the decision was rendered on the petitioner's appeal on 26 July 2022. Subsequent to the said orders passed by the Tribunal, on 12 October 2022, ....

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.... face of the record. However, on a comparative reading of sub-Section (2) of Section 254 of the IT Act, and Rule 1 of Order XLVII of CPC, it appears that such jurisdiction conferred on the Tribunal is more restricted. 17. In Beghar Foundation (Supra), the Supreme Court was considering a review petition, filed against the final judgment and order dated 26 September 2018, passed on the main proceedings. In rejecting the review petition, the Supreme Court observed that no case for review of such judgment was made out, and most importantly on the ground that change in law or subsequent decision/judgment of coordinate or larger bench by itself cannot be regarded as a ground for review. Such principles of law are squarely applicable in the fac....