The jurisdiction of the Commissioner to entertain rectification applications under Section 154 and the requirement to decide on the merits whether any case for rectification is made out.

A.M. Sapre, J.

1. By this petition preferred under Articles 226 and 227 of the Constitution of India, the petitioner assails the legality and validity of two orders one dated March 24, 2000 (annexure P-3) and the other dated November 27, 1995 (annexure P-4), passed by the Commissioner of Income-tax. In order to appreciate the issue involved and urged, a few facts which lie in a narrow compass need mention.

2. The petitioner is a public charitable trust. The petitioner-trust has set up an institution called "Indian Institute of Head and Neck Oncology" which according to the petitioner is rendering yeoman service to the society. Under the scheme of the Income-tax Act, 1961, subject to certain conditions and on compliance of certain requirements of the Act, the income of the charitable trust is exempt from payment of income-tax under Section 12A read with Sections 11/12 ibid.

3. The petitioner claiming the benefit under Section 12A ibid made an application on March 24, 1994/March 30, 1994, to the Commissioner of Income-tax. An application seeking condonation of delay in filing the said application was also made on November 27, 1995. The Commissioner of Income-tax granted registration to the petitioner under Section 12A ibid with effect from April 1, 1993. It was, however, mentioned in the order granting registration that the application was filed late by three years, four months and sixteen days and that the reasons given in the condonation of delay application are not satisfactory. In other words, in the opinion of the Commissioner no good and sufficient ground was made out for condonation of delay and hence the application for condonation of delay was rejected.

4. On October 24, 1997, the petitioner made an application under Section 154 of the Income-tax Act seeking rectification and prayed that the certificate issued under Section 12A on November 27, 1995, need to be rectified/modified as according to the petitioner there was a mistake apparent from the record. According to the petitioner, since no reasons were recorded as to why the registration was not granted from the date of inception, i.e., November 14, 1989, and hence grant of registration with effect from April 1, 1993, amounts to a mistake requiring rectification as envisaged under Section 154 ibid. It was also claimed that there were sufficient reasons for the delay in submitting the registration application and hence the delay ought to have been condoned thereby granting registration from the date of inception of the trust.

5. The Commissioner of Income-tax by order dated March 24, 2000 (annexure P-3), rejected the rectification application. This is what the learned Commissioner observed while rejecting the application :

"I have heard learned counsel and gone through the facts of the case. There is no dispute over the fact that the learned Commissioner of Income-tax, Bhopal, passed the impugned order ex parte without giving the trust an opportunity of being heard about the reasons which compelled the assessee to file the application for registration under Section 12A late, and such order may not be sustainable in the eyes of law but the question is whether a succeeding Commissioner of Income-tax can sit over the judgment of his predecessor and review his order under the guise of making rectification under Section 154. In my opinion, an answer to the question is emphatically 'no'. The succeeding officer cannot revise or review his predecessor's order on the ground that there was some procedural mistake in not giving full opportunity to the assessee of being heard. In my opinion, therefore, this is not a case where the provisions of Section 154 are applicable as there is no mistake apparent from the records."

6. It is this order, which is mainly assailed by the petitioner in this petition.

7. Heard Shri G.M. Chaphekar with Shri P.B.S. Nair, learned counsel for the petitioner, and Shri A.P. Patankar, learned counsel for the respondents.

8. Assailing the impugned order re