Back
2017 Supreme(Del) 1518
IN THE HIGH COURT OF DELHI AT NEW DELHI
S. MURALIDHAR, CHANDER SHEKHAR, JJ.
SHRI ARUN MALHOTRA – APPELLANT
VERSUS
PRINCIPAL COMMISSIONER OF INCOME TAX-2 – RESPONDENT
ITA NO. 303 OF 2017
DECIDED ON : 17-05-2017
FOR APPELLANT :DR. RAKESH GUPTA, MR. SOMIL AGGARWAL & MS. SHYAMLIMA BORAH, ADVOCATES
FOR THE RESPONDENT:MR. RAGHVENDRA SINGH, ADVOCATE
Courts can direct the ITAT to consider all issues and contentions afresh, and verbatim reproduction of portions from previous orders without attribution is not acceptable.
Headnote:
Income Tax - Litigation - Income Tax Act 1961 - Section 260 A - 363 ITR 195(Del) - 294 ITR 49(SC)
Fact of the Case:
The appeal is against an order passed by the Income Tax Appellate Tribunal (ITAT) for Assessment Year 2009-10 and Block Period. The issue is whether the ITAT failed to adhere to the specific mandate issued by the Court in a previous order.
Finding of the Court:
The Court found that the ITAT failed to consider all issues and contentions afresh as directed by the Court in the previous order, and instead, verbatim reproduced portions from previous orders without attribution. Consequently, the Court set aside the impugned order and restored the appeals to the ITAT for fresh consideration.
Issues: Failure of ITAT to adhere to the specific mandate issued by the Court in a previous order.
Ratio Decidendi: The ITAT must consider all issues and contentions afresh as directed by the Court, and verbatim reproduction of portions from previous orders without attribution is not acceptable.
Final Decision: The impugned order of the ITAT is set aside, and the appeals are restored to the ITAT for fresh consideration. The ITAT is directed to deliver a final decision in the appeals not later than six months from the date it first hears them after this remand.
S. MURALIDHAR, J.
1. This is the second round of litigation which, unfortunately, and inevitably is, for reasons explained hereafter, going to lead to a third round of litigation.
2. This appeal by the Assessee under Section 260 A of the Income Tax Act 1961 ('Act') is directed against an order dated 28th October2016 passed by the Income Tax Appellate Tribunal (ITAT) in IT(SS)A No. 77/De1/2012 and IT(SS)A No. 85/Del/2012 for Assessment Year (AY) 2009-10 and Block Period.
3. Admit.
4. Having heard learned counsel for the parties, the following question is framed for determination:
“Did the Income Tax Appellate Tribunal (“ITAT”) fail to adhere to the specific mandate issued to it by this Court in the previous order dated 25th November, 2013 in CIT v. Arun Malhotra (2014) 363 ITR 195(Del)?”
5. The background facts of the present case have been set-out in considerable detail in the previous order of this Court in CIT v. Arun Malhotra (supra) and need not be repeated in extenso. While setting aside the previous order of the ITAT dated 5th August 20008, this Court directed as follows:
“24. In view of the aforesaid, we answer the questions of law in favour of the Revenue and against the respondent but with an order of remand to the tribunal to discuss the entire evidence in detail on all aspects. The issues and contentions will be examined afresh. Factual findings in this order and the impugned order will not be treated as conclusive and final. To cut short delay, we direct that the parties shall appear before the tribunal on 16th December 2013, when a date of hearing shall be fixed.”
6. The critical word in the above paragraph, which contains a direction, is “afresh”. In other words, all the issues and contentions that arose in the appeals before the ITAT had to be examined tabula rasa.
7. One of the principal contentions of the learned counsel for the Appellant Assessee in the present appeal, was noted by this Court in its order dated 19th April 2017, as under:
“2. It is stated by Dr. Rakesh Gupta, learned counsel appearing for the Appellant that a large portion of the impugned order of the ITAT is a mere reproduction of the order passed by this Court on 25th November 2013 in ITA Nos.923/2009 and 1157/2009 whereby the earlier order of the ITAT was set aside and the matter was remanded to the ITAT for a fresh consideration. Prima facie, there appears to be no application of mind afresh by the ITAT particularly in the context of the specific directions issued by this court in its earlier order.”
8. Both DR Rakesh Gupta, the learned counsel for the Assessee as well as Mr Raghvendra Singh, learned counsel for the Revenue have referred to the decision of the Supreme Court in CIT v. P.V. Kalyanasundaram (2007) 294 ITR 49(SC), where one of the contentions of the Revenue in challenging the order of the Madras High Court was that the judgment under challenge “had merely plagiarized substantial portions from the order of the Commissioner and Tribunal in arriving at its conclusion and no independent assessment on the questions of law that arose for consideration, had been made.” Although the Supreme Court ultimately dismissed the appeal of the Revenue, it observed:
“We feel that quoting from an order of some authority particularly a specialized one cannot per-se be faulted as this procedure can often help in making for brevity and precision, but we agree with Mr. Vahanvati to the extent that any 'borrowed words' used in a judgment must be acknowledged as such in any appropriate manner as a courtesy to the true authors.”
9. If one peruses the impugned order of the ITAT in the present case, it is unmistakable that large portions of it have been virtually lifted verbatim from the order of the Assessing Officer (“AO”) as well as the order of this Court by which the matter was remanded to it. Worse still, these portions are not placed in quotation marks. Contrary to what was expected to be done, as explained by the Supreme Court in CIT v. P.V. Kalyanasun
