TaxTMI 
TaxTMI 
2004 (5) TMI 231
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....tion 254 of the Act. 3. As the application for rectification of order was made beyond four years of the order of Tribunal, it was directed to be fixed for hearing on the question of limitation before the Division Bench. When it came up before hearing before the Division Bench, the decision of Nagpur Bench of ITAT in the case of Bhillai Engg. Corpn. Ltd. v. Dy. CIT [2002] 81 ITD 282 was cited and after some discussion, the counsel prayed for an adjournment and made a petition to the Hon'ble President, ITAT for constitution of a larger Bench. Hence the constitution of the present Special Bench. 4. The learned counsel Shri S.N. Soparkar submitted that section 254(2) provides for two situations in which the Tribunal can rectify a mistake -(1) Suo moto and (2) on an application by either party. Placing reliance on the decision of the Nagpur Bench in the case of Bhillai Engg. Corpn. Ltd. he submitted that in the first situation which is discretionary, the time limit of four years is provided and for the second situation which is a mandatory exercise on mistake being brought to its notice by either party, no time limit is provided. He further submitted that section should be seg....
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.... the order after 4 years from its order or it had to pass the order within 4 years. It shows that the matter of period of limitation to both the suo motu rectification and on a party's request has settled and should not be a matter of litigation after such a long period. He referred to the decisions in cases of (i) Asstt. CIT v. Somany Pilkington Ltd. [1994] 49 ITD 207 (Delhi); (ii) ITO v. Homi Mehta & Sons (P.) Ltd. [1985] 14 ITD 64 (Bom.); (iii) His Highness Sri Rama Verma v. ITO [1982] 2 ITD 491 (Cochin); (iv) Somany Pilkington's Ltd. v. ITO [1989] 31 ITD 286 (Delhi); (v) IAC v. Ballarpur Industries Ltd. [1987] 21 ITD 164 (Nag.); wherein it is held that the rectification may not be barred by limitation where the application for rectification is filed within four years time limit because it is the duty of the Tribunal to dispose of the application of the assessee filed within time and the rights of the party cannot lapse because of latches of the Appellate Tribunal. Contrary to the above, there are two decisions wherein it was held that no orders can be passed as the four years period had lapsed, viz. (i) Dr. Rajah Sir M.A. Muthiah Chettiar v. ITO [1985] 11 ITD 288 (Mad.)....
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.... laws. The rule of casus omissus states that the matter which should have been provided but has not been provided cannot be supplied by the Court. This view has been also taken by the Hon'ble Supreme Court in the case of Asstt. Commissioner v. Velliappa Textile Ltd. [2003] 263 ITR 550. In Smt. Tarulala Shyam v. CIT [1977] 108 ITR 345 (SC) it has also been held that it is not the job of the Court to make good the deficiency. The Hon'ble Bench has also given emphasis to the coma appearing after the word 'Tribunal' in section 254(2) which is not warranted as stated by Vepa P. Sarthi in his book Interpretation of Statutes Second Edition at page 265 that punctuation is not part of the Statute and in construing the Statute, the Court should first read it without the punctuation. He further submitted that the fundamental principle of interpretation of Taxing Statutes is the principle of strict construction. Taxing statutes have to be interpreted differently from beneficial legislation (e.g. Labour Laws). Reference was drawn to the decision of the Supreme Court in the case of K.M. Sharma v. ITO [2002] 254 ITR 772. The ITAT Nagpur Bench has thus extended the limitation perio....
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....be made as a matter of 'duty' in situation (b). However, the activity to be carried as 'amendment' in situation (b) is the same. It is not a separate or different and this is made absolutely clear through employment of words 'such amendment' and 'if the mistake is brought to its notice.' Thus same (amendment) activity may be carried out by the Tribunal on its own motion as per situation (a) or as a matter of duty if the mistake is brought to its notice by the parties to the order. The period of limitation controls above activity. Condition of exercise of power including period of limitation are common in the two situations; one asking for discretionary action and the other making action compulsory, i.e., as a matter of duty. The portion of sub-section covered by situation (b) is not independent of situation (a). The language of the statute is clear and unambiguous and is required to be given effect to. 13. In our opinion, therefore, there is no scope to argue that amendment required to be made when mistake is brought to the notice of the Appellate Tribunal can be made at any time and period of limitation of four years from the passing of order und....
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....f India, the decision pronounced by the Supreme Court is a binding precedent. The law is interpreted by the Apex Court is the law as it always has been. Denying the opportunity to the parties to argue the miscellaneous application on the jejune ground of processual lapse would tantamount to denying the justice. Not only that it will prolong litigation on a point which stands adjudicated by the decision of the Apex Court. It hath been well said declared Lord Coke: "Interest republica ut sit finis litum. Translation loses terseness but what Lord Coke put in Latin lag conveys that the law suits be not protracted, otherwise great oppression might be done under the colour and pretence of law. We have considered the panoply of law on which the Tribunal based its decision. To be precise it was the concept of ownership. The concept has been, redefined by the Apex Court. The Tribunal is bound to follow the law propounded by the Hon'ble Supreme Court. We, therefore, for the palladium of justice condone the delay in filing the miscellaneous application and proceed to decide the issue on merits." 15. On a careful reading of the above, it appears that the Nagpur Bench has taken into cons....
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....concern of the court. The duty of the court is to decide what the law is and apply it, not to make it. That however is not the case here. We are not reading something in the language used by the Statute. That power is amenable on a fair reading of the provision itself. Taking into consideration the decision of Gujarat high Court in Saurashtra Kutch Stock Exchange Ltd.'s case the Tribunal could be said to have suo motu powers of rectification and the Nagpur Bench cannot be said to have read something in the section which is not there namely 'of its own' as it is implied from the wordings used, i.e., 'The Appellate Tribunal may'. 17. However its further observation as stated in the second aspect that "therefore, time limit of four years is in the context of suo motu rectification. Where rectification is to be done in accordance with prayer of either of the parties such limit is not much relevant" is not born out on a fair reading of the provision. We are not in a position to accept that view. Otherwise also, if the view of the Nagpur Bench is taken as correct, there will be flood gate of miscellaneous applications and the orders passed even by the First Preside....
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....ling with rectification in other Statutes are:- (i) Section 35C(2) of Central Excite Act, 1944 is as under:- "(2) The Appellate Tribunal may, at any time within four years from the date of the order, 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 amendments if the mistake is brought to its notice by the Commissioner of Customs or the other party to the appeal." (ii) Section 129B(2) of the Customs Act, 1962 reads as under: (iii) Section 17 of Interest Act, 1974 reads as under:- "(1) With a view to rectifying any mistake apparent from the record, the Commissioner, the Assessing Officer, the Commissioner (Appeals) and the Appellate Tribunal may, of his, or its, own motion or on an application by the assessee in this behalf, amend any order passed by him or it in any proceeding under this Act within four years from the end of the financial year in which such order was passed." In the legislative enactment of 1974, the period of four years to carry amendment of order passed is explicitly and clearly provided; leaving no scope for arguments, like the one....
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....erson in respect of search initiated or books of account or other documents or any assets requisitioned after the 30th day of June, 1995, but before the 1st day of January, 1997; and (b) two years from the end of the month in which the notice under this Chapter was served on such other person in respect of search initiated or books of account or other documents or any assets are requisitioned on or after the 1st day of January, 1997. 22. These sections in no way help us in resolving the controversy; though these have a bearing on the issue that wherever the Legislature wanted to provide the period of limit to start, it is so provided specifically, viz., "after the expiry of four years from the end of the financial year in which the order sought to be amended was passed." In section 154(7); "at any time before the time for presenting an appeal against such order has expired", in section 269N, "no amendment shall be made under this section after the expiry of six months from the end of the month in which the order sought to be amended was made" in section 269UJ; "after the expiry of the financial year in which the proceedings, - are completed, or six months ....
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....ier occasion. 24. In the case of Smt. Tarulata Shyam section 2(6A)(e) of the Indian Income-tax Act, 1922 came for consideration which created a fiction for its applicability if at the time of payment of advance or loan to a shareholder of a company, in which public are not substantially interested and tax is attracted on the loan or advance to the extent to which the company possess the accumulated profits, the moment the loan or advance is received. The loan in this case was repaid before the end of the year and a contention was raised that the fiction created by section 2(6A)(e) would not be applicable. The Supreme Court held that "the language of sections 2(6A)(e)and 12(1B) is clear and unambiguous. There is no scope for importing into the statute words which are not there. Such importation would be not to construe, but to amend, the statute. Even if there be a casus omissus the defect can be remedied only by legislation and not by judicial interpretation. Once it is shown that the case of the assessee comes within the letter of the law, he must be taxed, however great the hardship may appear to the judicial mind to be." The language of section 254(2) of the Act, in our opini....
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....eaven falls, as in our opinion, even period of limitation is part of the jurisprudence and cannot be brushed aside or ignored to grant relief on the prayer of the assessee or revenue after the expiry of said period of four years. Similarly, in the case of S.P. Gupta the Supreme Court held that obvious omission can be made up by suitable interpretation but the court cannot supply supposed deficiencies as in that case instead or declaring the Law, would be making laws. 26. In view of the above discussion we therefore, hold that time limit of four years to make rectification applies both to suo motu action of the Appellate Tribunal as well as to action taken on request of parties. The Miscellaneous Application of the assessee filed on 11-4-2002 for rectifying an order of the Tribunal dated 28-4-1997 is barred by limitation and the Tribunal cannot make any rectification of its order on the prayer of the assessee as the time limit for four years from the date of the order has already expired. We do not find any merit in the application of the assessee. It has accordingly to be dismissed. 27. The Nagpur Bench, it seems, was influenced by the zeal of doing justice which they thought....
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....ims are extinguished or ought to be held extinguished where they are not litigated within the prescribed period. They quicken diligence by making it in some measure equivalent to right. They discourage litigation by bringing in one common receptacle all the accumulations of past times which are unexplained and have now from lapse of time become inexplicable. It has been said by John Voet that controversies are limited to a fixed period of time, lest they should be immortal while men are mortal". It is a trite law that a statute of limitation is a statute of repose, peace and justice. 30. The Privy Council in White v. Paruthe 1 Knapp's Privy Council Reports 179 enunciated the principle that if a person is insensible to the value of civil remedies and he is not alert enough to make his claim with promptitude, such a person should not be aided by the State in the enforcement of his claim. This is in keeping with the other Latin maxim 'Vigilantibus non dormientibus jura subsvenient'. In the instant case it was further pointed out that statutes of limitation serve to ensure private justice, suppress fraud and perjury, quicken diligence and prevent oppression. 31. The o....