The High Court (HC) of Jharkhand that the rectification of the order is valid when the Miscellaneous application under section 254(2) of the Income Tax Act, 1961 was filed within four years before the amendment of the said section.
Kamal Nayan Singh, the appellant challenged the assessment orderwherein the C.I.T. (Appeals)deleted the entire addition. The petitioner filed a miscellaneous application before the tribunal praying for reconsideration of the matter on certain grounds (Annexure 4). The said miscellaneous application has been dismissed by the impugned order on the ground of limitation.
It was submitted that the order passed by the tribunal is perverse in nature as it has dismissed the miscellaneous application of the appellant on the ground of limitation without considering the law existing on the date of filing of the said miscellaneous application since the petitioner rightly filed the miscellaneous application within time as per law i.e., within a period of four years from the date of the communication.
On the other hand, revenue opposed and stated that as per the mandates of law, the appellant was supposed to file any Miscellaneous Application under Section 254 (2) within a period of six months from the date of the order.
The ITAT allowed the appeal of the Revenue by reversing the order of C.I.T. (Appeals) vide its order dated 23.12.2009 which was communicated to the petitioner vides letter dated 02.8.2010 and the miscellaneous application was filed by the petitioner on 03.06.2014. This implicated that the miscellaneous application under section 254 (2) of the Income Tax Act Act was filed within a period of four years from the date of communication of the order by the Assistant Registrar.
The amendment of the said section w.e.f. 01.06.2016, the same could be brought to the notice of the appellate tribunal within 6 months from the end of the month in which the order was passed. The period of four years was provided under the then-existing section 254 (2) of the Income Tax Act and as such, such miscellaneous application was not barred by law of limitation.
Justice Deepak Roshan observed that the appellant had filed the miscellaneous application much before the amendment made in section 254 (2) of the Act w.e.f. 01.06.2016 and the impugned order dated 08.9.2017, passed by the Income Tax Appellate Tribunal was quashed and set aside.
Further, the matter is remitted back to the tribunal with a direction to entertain the miscellaneous application filed by the appellant assessee and the appeal was allowed.
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