ORDER
Jyoti Balasundaram, Member (J)
1. The assessee has filed the above application in terms of Section 35C(2), the Central Excises and Salt Act, 1944 for rectification of mistakes purported to be apparent on the record of the Tribunal’s Final Order No. 159/97-C, dated 28-2-1997 -1998 (103) E.L.T. 152 (T). In this order, the Tribunal has held that the applicants/assessees are not entitled to the benefit of Notification No. 40/85, dated 17-3-1985 in respect of exemption to Ammonia used in the manufacture of Molten Urea which is further used in the manufacture of Melamine. In coming to its conclusion, the Tribunal has relied upon its earlier Order Nos. 404 to 409/91, dated 19-4-1991 reported in 1991 (56) E.L.T. 257 in the applicant’s own case.
2. As regards the alternative claim for exemption under Notification 217/86, the Tribunal has decided in favour of the appellants by relying upon its earlier Order Nos. 58-59/96-C, dated 29-1-1996; 1996 (83) E.L.T. 159 (T), however, since the lower authorities have not dealt with this aspect, the matter was remanded to the Assistant Collector for examining the prayer of the applicant for benefit under this Notification.
3. The learned Counsel Shri C. Willingdon submits that the order of the Tribunal reported in [1991 (56) E.L.T. 257] has been reversed by the order dated 28-2-1997 of the Apex Court in Civil Appeal Nos. 3041-46 of 1991 [1997 (91) E.L.T. 3 (S.C.)] wherein the Hon’ble Supreme Court has held that exemption to Ammonia used in the manufacture of Melamine through Molten urea is available under Notification 40/85 and since in the present case, the Tribunal has followed its earlier order cited (supra), there is a obvious mistake apparent on record and therefore, Final Order No. 159/97-C, dated 28-2-1997 [1998 (103) E.L.T. 152 (T)] requires to be recalled and rectified in the light of the judgment of the Apex Court in the applicant’s own case. In support of his prayer, the learned Counsel relies upon the decisions of the Supreme Court reported in AIR 1963 (SC) 1124 (Collector of Customs, Calcutta v. East India Commercial Company Ltd); AIR 1973 (S.C.) 1325 (Commercial Tax Officer, Bangalore v. Sh. Venkateswara Oil Mills); 1996 (66) ECR224 (S.C.) (Poothundu Plantations Pvt. Ltd. v. Agricultural Income-tax Officer, Kerala) and 1996 (86) E.L.T. 476 (S.C.) (Aroon Phospho Products Pvt. Ltd. v. Collector of Central Excise).
4. Opposing the contention of the learned Counsels Sh. Hassan, learned DR submits that there is no error apparent in the Tribunal’s Final Order No. 159/97-C, dated 28-2-1997 -1998 (103) E.L.T. 152 (T) as the Tribunal had correctly applied its earlier order in the case of same appellants on the same issue and since the judgment of the Apex Court reversing the earlier order of the Tribunal was pronounced on 28-2-1997 i.e. immediately after the Tribunal’s final order in the present case, the Tribunal had not erred in following its earlier decision which was in force till 28-2-1997 when it was set aside by the Hon’ble Supreme Court. He submits that the present application is actually an application for review in the garb of an ROM application and as the Tribunal has no powers to review its own order, the application merits rejection.
5. We have carefully considered the submissions of both the sides. We find that in matters arising in cases under the Income-tax Act and the Wealth-tax Act, an application for rectification has been held to lie on the basis of a decision of the Hon’ble Supreme Court, although rendered subsequent to the decision of the Tribunal, if there was no further investigation on facts involved and the principle of the Supreme Court decision could be straightaway applied to show that the decision already issued, was mistaken.
6. In the case of S.A.L. Namyana Row, Commissioner of Income-tax, Bombay v. Model Mills Nagpur Ltd. reported in [1967 (64) ITR 67 (S.C.)], the facts were that, by order dated 27-7-1955, the Income-tax officer levied an additional tax on excess dividend declared by the respondent company. Thereafter, the Bombay High Court, in the case of Khatau Makanji Spinning & Weaving Co. Ltd. v. Commissioner of Income-tax – [1956 (30) ITR 841] held that levy of tax on excess dividend was illegal. The respondent company applied to the ITO for refund of tax paid although it was not expressly stated in the application that the order be rectified under Section 35 of the Income-tax Act. The ITO rejected the request by order dated 2-11-1957 on the ground that the assessment was completed well before the judgment of the Bombay High Court. Against the order of ITO, the company applied to the Commissioner of Income-tax under Section 33A of the Income-tax Act to revise that order but the Commissioner of Income-tax rejected the application as time barred treating it as an application for cancellation of the levy of tax, and, as an application against refusal of rectification, he held that it was not maintainable because the error was not apparent from the record but was one which could be discovered only by a process of argument and debate The High Court allowed the Writ petition filed by the respondents under Article 226 of the Constitution of India for revising the order dated 2-11-1957 passed by the Income-tax officer. The order of the High Court was upheld by the Supreme Court.
7. In the case of Parshuram Pottery Works Co. Ltd. v. D.R. Trivedi, Wealth-tax officer reported in [1975 (100) ITR 651], the Hon’ble Gujarat High Court held that the provisions of Section 35 of the Wealth-tax Act (Application for Rectification) were attracted in cases where assessment orders, though proper and valid when they were made but were later found to be erroneous, in view of subsequent judicial pronouncements. In that case, the petitioner claimed to deduct in the computation of net wealth on the valuation date, a certain amount each year in respect of provision for taxation but the claim was disallowed on the ground that the amount provided for tax liability did not constitute ‘debt owed’ from the petitioner on the relevant valuation date within the meaning of Section 2(m) of the Wealth-tax Act, 1957 and accordingly, the Wealth-tax officer added that amount claimed by way of deduction and computed the net wealth of the petitioner on that basis. No appeals were preferred against the order of assessment. Subsequently, the petitioner came to know a decision by the Income-tax Appellate Tribunal that the amounts claimed by it in respect of provision for taxation were deductible in computing net wealth. The petitioner applied to Wealth-tax officer for rectification of order of assessment under Section 35 of the Wealth-tax Act, 1957 on the ground that there was an error apparent on the fact of the record. The applications were rejected by the Wealth-tax officer. Revision applications filed before the Commissioner of Wealth-tax were also dismissed. Thereupon, the petitioner moved the High Court, seeking issue of a Writ of Certiorari to quash the order passed by the Wealth-tax officer and the order of the Commissioner, as well as Writ of Mandanmus, directing the Wealth-tax officer and Commissioner of Wealth-tax to rectify the assessment orders by allowing deductions of the amounts by way of provision for taxation. The argument of the learned Advocate on behalf of the Revenue was that in order to attract the provisions of Section 35, what must be shown is that the mistake was committed at the time of making of the order and not that the order was ultimately found to suffer from an infirmity or a mistake was subsequently discovered in the order as a result of later judicial pronouncements. The High Court held that the submission of the Revenue was not well founded. The Court held as under :
“It is true that the Wealth-tax officer did not have before him the decision of this Court in Raipur Manufacturing Company case or that of the Supreme Court in Kesoram Industries and Cotton Mills case when he passed the assessment orders in the petitioner’s cases and that both the decisions were given after the assessment orders were made. But these decisions did not enact or make the law in any sense but merely interpreted the expression ‘debt owed’ occurring in Section 2(m) of the Act which was undoubtedly on the statute book at the time when the assessment orders were made by the Wealth-tax officer. These decisions, insofar as they declared that the amounts claimed by an assessee in respect of provision for taxation are deductible in computing the net wealth of the assessee since they represent ‘debt owed’ by the assessee within the meaning of Section 2(m) of the Act, merely stated that the law had always been and must always be understood to have been . The fact that these decisions were not before the Wealth-tax officer when he made the orders of assessment in the petitioner’s cases has, therefore, no material bearing on the question whether the said orders disclose any mistake apparent from the record. If that be the correct legal position, and we hold that it is, the only conclusion possible is that the assessment orders, insofar as they disallowed the claim of the petitioner for deduction in respect of the amount of provision for taxation, proceeded on a wrong view of the law and the said orders were bad at their very inception, on the date on which they were made. The orders of assessment thus disclosed a mistake apparent from the record and were liable to be rectified in exercise of the powers conferred under Section 35 of the Act. In our opinion, therefore, the Wealth-tax officer committed an apparent error of law in rejecting the petitioner’s application for rectification of the mistake and the Commissioner of Wealth-tax likewise committed an error of law apparent on the fact of the record in rejecting the petitioner’s revision application.”
The Court further held that the assessment order continued to be liable to be modified under Section 35 of the Wealth-tax Act until the condition precedent under that section was satisfied, notwithstanding the fact that no appeal was preferred from the order of assessment. The Court allowed the Writ petition filed by the assessees and the Wealth-tax officer was directed to pass appropriate orders on the applications filed under Section 35 for different assessment years in accordance with law and in the light of the observations made in that judgment.
8. In the case of Kil Kotagiri Tea and Coffee Estates Co. Ltd. v. lncome-tax Appellate Tribunal and Ors. reported in [1988 (174) ITR 579], the Hon’ble Kerala High Court held that an assessment order based upon interpretation o: application of law ultimately found to be wrong in the light of later judicia pronouncements, discloses a mistake apparent from the record and requires t be rectified. In that case, the question related to interest on advance tax paid beyond the due date. The question was answered in the negative by the In come-tax officer; the Commissioner of Income-tax (Appeals) upheld the plea; of the assessee and reversed the order of the Income-tax officer. In second ap peal, the Income-tax Appellate Tribunal held that the belated payments are not to be taken into account as advance tax for the purpose of Section 214 o the Income-tax Act, 1961 therefore interest is inadmissible for such belated payments. The Tribunal’s order was based upon the decision of the Keral High Court reported in [1980 (122) ITR 587] in the case of Sethumadhavan Commissioner of Income-tax. The judgment of the Single Judge ii Sethumadhavan’s case was reversed by the Division Bench of the Kerala High Court which is reported in [1982 (135) ITR 49], the petitioner applied for rectifi cation on the basis of the Division Bench decision, and prayed that the ITA may be pleased to hold that interest is admissible even for belated payment o advance tax. The Tribunal dismissed the petition filed by the petitioner unde Section 154 of the Income-tax Act holding that rectification under that section must be of a mistake which is mistake in the light of the law in force at the time when the order sought to be rectified was passed and that the subsequent deci sion of the High Court has no retrospective operation as in the case of subse quent legislation or the decisions of the Supreme Court. The petitioners filed, Writ petition in the Hon’ble Kerala High Court which held as under :
“An order of assessment, based upon an interpretation or application of law which is ultimately found to be wrong in the light of judicial pronouncements rendered subsequently, discloses a mistake apparent from the record. When the court decides a matter, it does not make the law in any sense but all it does is that it interprets the law and states what the law has always been and must be understood to have been. Where an order is made by an authority, on the basis of a particular decision, the reversal of such decision in further proceedings will justify a rectification of the order based on that decision (See Bhagwandas Kevaldas v. Mehrotra N.D. – (1959) 36 ITR 538 (Bom.); Parshuram Pottery Works Co Ltd. v. Trivedi D.R. – 1975 100 ITR 651 (Guj.) and Bhauram Jawahirmal v. C.I.T. – 1980 (121) ITR 487,490 (All.)”
The Court further held that:
“We would state, that the view of the Appellate Tribunal, that rectification contemplated by Section 254(2) or Section 154 of the Income-tax Act must be of a mistake which is a mistake in the light of the law in force at the time when the order sought to be rectified was passed, is a clear error. A binding decision rendered by a court is always retrospective and the decision which is overruled was never the law. The overruling decision should be deemed to have been in force even on the day when the order sought to be rectified was passed. We are further of the view that the Appellate Tribunal was in error in holding that the subsequent decision of the High Court has no retrospective operation as in the case of subsequent legislation or the decision of the Supreme Court. A subsequent binding decision of the Supreme Court or the High Court has retrospective operation and overruling is always retrospective.”
The Court allowed the Writ petition and directed the IT AT to restore the petition for rectification and dispose of the same in accordance with law and in the light of the observations contained in the High Court judgment.
9. Turning to cases decided by this Tribunal, we find that it has been held in the case of Sirpur Paper Mills v. Collector of Central Excise [1996 (24) E.L.T. 49] that rectification of earlier order, cannot be made on the basis of a later order when different conclusions were arrived at on the same issue of interpretation of relevant provisions and when the earlier order was not inconsistent with the later one, because of any Amendment Act operating retrospectively. This decision was followed in the case of National Rayon Corporation Ltd. v. Collector [1993 (67) E.L.T. 186] in which no error apparent in the order of the Tribunal was proved. In the case of M.C. Desai v. Collector [1991 (56) E.L.T. 425], the application for rectification on the basis of Tribunal’s order taking a different view and against which a reference application had been filed by the appellants and rejected by an order where a distinction was made in the facts in the cases before two Benches, was rejected holding that two different orders from two different Benches on the same question, was not within the scope of an application for rectification.
10. In the case of Saurashtra Cement and Chemical Industries v. Collector of Customs, Ahmedabad [1987 (29) E.L.T. 87], the Tribunal held that the later decision of the Tribunal giving a different interpretation would not be a ground for rectification of an earlier order and there was no case of error apparent from the record.
11. On analysing the above decisions of the Tribunal, we find that in none of them, was the Tribunal seized of a situation where the earlier order of the Tribunal had been reversed by the Apex Court nor were the judgments of the Supreme Court or High Courts, noted. In the case before us, the Tribunal’s final order out of which the present ROM application arises, is based upon an earlier Tribunal decision in the applicant’s own case which has since been reversed by the Apex Court. The judgment of the Supreme Court applies on all fours to the present case and no further investigation is called for. Therefore, applying the ratio of the judgment of the Hon’ble Supreme Court in the case of Model Mills case cited (supra) and decisions of the Gujarat High Court and the Kerala High Courts (supra) we are satisfied that an error apparent on the face of the record has arisen in our final order relating to denial of benefit of Notification 40/85 to Ammonia when used in the manufacture of Melamine through the route of molten urea, in view of the judgment, dated 28-2-1987 of the Hon’ble Supreme Court extending the benefit of the Notification to such ammonia manufactured by the appellants.
12. In the result, we rectify Final Order No. 159/97, dated 28-2-1997 by holding that the benefit of Notification 40/85 is available for captively consumed ammonia utilised by the appellants as input for manufacturing molten urea. The automatic consequent of this correction is that the appeal of the appellants is to be allowed and is accordingly ordered.
The ROM application is hereby allowed.
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(Jyoti Balasundaram)
Member (J)
S.K. Bhatnagar : Vice President
With due respects to Hon’ble Member (Judicial) my views and orders are as follows :-
13. I observe that the basic issue involved in this case is whether this Tribunal is empowered to recall its final order in such situations.
14. Neither the Customs Act under which this Tribunal had been constituted or the Central Excise Act (w.r.t. which this case has arisen) nor the CEGAT (Procedure) Rules provide for power of review; but the Tribunal does have a power of rectification of mistake apparent on the face of record. Since in various statutes the provisions for review or recall, even where provided, are different and distinct from provisions relating to rectification of errors, if any, apparent on the face of record, we are required to see whether this application could be entertained and if so the extent to which we can proceed in the matter.
In the present case, evidently there was no mistake on the part of the Tribunal in announcing the order as it did in the light of the law in force at that time when the order was passed. There is no doubt or dispute about it. If still the applicant was aggrieved, it was open to him to have filed an appeal before the Hon’ble Supreme Court but he has chosen not to do so and instead he has filed this application.
15. A question arises whether in these circumstances it was open to the Tribunal to recall its order on the ground that subsequently Supreme Court has taken a different view in the matter regarding the interpretation and application of the Notification in question. It is also interesting to note that Tribunal had not rejected the appeal of the applicant but had allowed it by way of remand to enable the authorities below to consider the benefit in terms of Notification No. 217/86 and in the process an alternative submission of the applicant stands accepted. Therefore, their insistence on reconsideration of the matter with a view to consider it in terms of another Notification (40/85) with reference to which the Supreme Court has later given a decision in their favour is another aspect which is required to be kept in view. It is noteworthy that the applicant has even at this stage not contended that there was any error in allowing the benefit to be considered in terms of Notification 217/86.
16. In view of this factual background it appears that there is some substance in the ld. DRs submission that what the appellant is basically trying to do is to request for a review in the garb of an ROM application. That the Tribunal has no powers to review its own order has not been disputed by the applicant. However, the ld. Counsel has cited case law relating to Income Tax and Wealth Tax etc. in which orders have been passed w.r.t. the provisions in these Acts. We are neither familiar with those provisions nor in a position to make any pronouncement w.r.t. the scope or ambit of those provisions. It was of course open to the applicant to show that the provisions of the Income Tax Act and the Wealth Tax Act referred to in the case law cited by them were pari-materia with those of our corresponding provisions/ if any, but since it has not been so done, the department has not got the chance to show the distinction, if any. Further more, the cases which have been cited are w.r.t. those ones in which judgments have been passed by the High Courts on writ petitions. It is common knowledge that the scope and ambit of writ petitions is different and much wider than the statutory provisions in our laws and the High Courts exercise much greater constitutional authority and wider discretionary powers particularly in the field of writ jurisdiction; And it goes without saying that this Tribunal as a statutory body has a much limited jurisdiction and discretion in the matter.
17. The Tribunal is passing a large number of final orders, against some of which petitions/appeals do get filed, in the course of time, before High Courts or the Supreme Court and the Hon’ble Courts express their views upholding many, modifying others and setting aside some. A question arises if it is so done after a couple of years or more, and let us say a particular order is set aside then will all the earlier cases decided in the past would be reopened or recalled or modified irrespective of whether appeals had been filed against them or not ?
18. In my opinion, the judgment of a superior court passed a particular case decides that case; and its ratio normally applies prospectively. Even the relief is subject to the extent allowed in the judgment or limited by other provisions in the Act relating to the time bar etc., unless, of course, retrospective effect is intended, whether expressly so or by necessary implication; And the Tribunal such as ours which has no power of review cannot recall its order which had already assumed finality; An ROM application falls in a different category and its scope is limited to error apparent on the face of record and is subject to the Supreme Court judgments on the scope of such application(s).
19. At the same time the case law cited by the ld. Counsel does show that in Income Tax and Wealth Tax cases where the High Courts have intervened by exercising writ jurisdiction, they have allowed rectification of error by assigning retrospective effect to subsequent judgments on the basis of which writ petitions were filed. I feel that insofar as Customs and Excise is concerned, it is still a grey area but it is time some objective criteria are evolved and a line distinguishing a case of rectification of mistakes from that of review or recall is drawn. It is significant that in the present case no case w.r.t. the Customs Act under which the Tribunal has been constituted or the Excise Act w.r.t. which this case has arisen has been cited by either side.
20. I therefore, feel that it will be more appropriate to refer the matter to a Larger Bench so that the issue is settled once and for all.
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(S.K. Bhatnagar)
Vice President
Date: 23-3-1999
POINT OF DIFFERENCE
In view of difference of opinion between Hon’ble Member Judicial and the Vice President, the matter is submitted to the Hon’ble President for reference to a third Member on the following point :-
“Whether the Application is required to be accepted as proposed by the ld. Member (Judicial) or the matter is required to be referred to a Larger Bench as proposed by the Vice President ?”
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(Jyoti Balasundaram) (S.K. Bhatnagar)
Member (J) Vice President
Date : 30-3-1999 Date : 23-3-1999
G.A. Brahma Deva, Member (J)
21. In view of the difference of opinion between the Hon'ble Member (Judicial) and the then Hon'ble Vice President the matter is referred to me to express my view as third Member on the following points :-
"Whether the application is required to be accepted as proposed by the ld. Member (Judicial) or the matter is required to be referred to a Larger Bench as proposed by the Vice President."
22. Heard both the sides with reference to the difference of opinion.
23. Arguing for the appellants in support of the application for rectification of mistake, Shri Willingdon C. submitted that issue relates to exemption under Notification No. 40/85, dated 17-3-1985 in respect of Ammonia manufactured and used in the manufacture of Molten Urea. The Tribunal while deciding the issue as per Order No. 159/97-C, dated 28-2-1997 in Appeal No. E/4571/93-C held against the assessee relying upon the earlier decision of the Tribunal in the very appellant’s case as reported in 1991 (56) E.L.T. 257. Earlier order -1991 (56) E.L.T. 257 referred to by the Tribunal in dismissing the appeal has been reversed by the Supreme Court in Civil Appeal Nos. 3041-46/91 on the same day i.e. 28-2-1997 as reported in 1997 (91) E.L.T. 3 (S.C.). He submits that Tribunal’s Order No. 159/97-C carries a mistake apparent from the record, because it is based on interpretation of law vide 1991 (56) E.L.T. 257 which ultimately found to be wrong in the light of judicial pronouncement rendered subsequently by the Apex Court. He said that while Supreme Court reversing the earlier decision declares the law as it has been or it is understood to have been from the beginning. The earlier order of the Tribunal has merged in the judgment in the Supreme Court and the judgment of the Supreme Court is having retrospective effect, because it declares the correct interpretation of an already existing provision of law. Any Authoritative judgment is always considered as not laying down the law first time but declaring the law as it should have been or it should be understood to have been from its inception, in this context, he referred to the following abstract from Salmod on Jurisprudence, twelfth edition, by P.J. Fitzgerald – Exb. XXI.
“As we have seen, the theory of case law is that a Judge does not make law; he merely declares it; and the overruling of a previous decision is a declaration that the supposed rule never was law. Hence any intermediate transactions made on the strength of the supposed rule are governed by the law established in the over-ruling decision. The overruling is retrospective, except as regards matters that are res judicata or accounts that have been settled in the meantime. A repealed statute, on the contrary, remains valid and applicable as to matters arising before the date of its repeal.”
24. He submitted that a subsequent judgment of the Supreme Court validly form the basis for rectifying of an order of the Tribunal, and in support of his contention he cited following decisions :-
(i) B.V.K. Seshavatamm v. C.I.T. -1994 (210) ITR 633 (A.P.)
(ii) Kil Kotagiri Tea & Coffee Estates Co. Ltd. v. Income Tax Appellate Tribunal -1988 (174) ITR 579 (Ker.)
(iii) Parshuram Pottery Works Co. Ltd. v. D.R. Trivedi -1975 (100) ITR 651 (Guj.)
(iv) S.A.L. Narayan Row, C.I.T. v. Model Mills Nagpur Ltd. -1967 (64) ITR 67 (S.C.)
(v) Ram Dass Rice & General Mills v. State of Punjab -1996 (100) STC 211 (P&H)
(vi) Hero Cycles Ltd. v. State of Punjab and Ors. – 1995 (99) STC 191 (P&H)
(vii) State of Kerala and Anr. v. P.K. Syed Akbar Sahib – 1988 (70) STC 191 (S.C).
(viii) M.K. Venkatachalam, I.T.O. v. Bombay Dyeing & Mfg. Co. Ltd. – AIR 1958 S.C. 875
25. He said that though the above decisions were rendered with reference to the other taxing statute such as Income Tax, Wealth Tax etc., the provisions for rectification of mistake apparent from record are precisely the same in Central Excise/Customs Law as in Income Tax, Wealth Tax etc. He said that there was no necessity to refer the question to the Larger Bench as proposed by the Hon’ble Vice President in the absence of conflicting decisions of the different Benches of the Tribunal on the issue involved herein. He stated that the respective High Courts have held that Tribunal was not justified in rejecting the application for rectification on the ground that the subsequent decision of the Supreme Court did not constitute a mistake apparent from the record and not even a contrary decisions of any High Court on this issue.
26. On the other hand Shri H.K. Jain, ld. SDR contended that what the assessee wants to review the order of the Tribunal in the garb of ROM application and the Tribunal has no power to review its own order. He said that a later decision would not be a ground for rectification of an earlier order and there was no case of an error apparent from the record. In support of his contention he referred to the decision of the Supreme Court in the case of Dokka Samuel v. Dr. Jacob Lazarus Chelly reported in 1997 (4) SCC 478 wherein it was held that the omission to cite an authority of law does not a ground for reviewing the prior judgment saying that there is an error apparent on the face of the record, since the Counsel has committed an error in not bringing to the notice of the Court the relevant precedents. He also referred to the decision of the Delhi High Court in the case of Deeksha Suri v. Income Tax Appellate Tribunal [1998 (102) E.L.T. 524] wherein it was held that “What is not permitted to be done by the statute and deliberately ommitted to confer review jurisdiction on the Tribunal, cannot be indirectly achieved by recourse to Section 254(11) of the Act”. He also drew my attention to the observation made by the Hon’ble Vice President particularly in Para 17 and 19 of the proposed order which reads as under :-
“17. The Tribunal is passing a larger number of final orders, against some of which petitions/appeals do get filed, in the course of time, before High Courts or the Supreme Court and the Hon’ble Courts express their views upholding many, modifying others and setting aside some. A question arises if it is so done after a couple of years or more, and let us say a particular order is set aside then will all the earlier cases decided in the past would be reopened or recalled or modified irrespective of whether appeals had been filed against them or not?
19. At the same time the case law cited by the ld. Counsel does show that in Income Tax and Wealth Tax cases where the High Courts have intervened by exercising writ jurisdiction, they have allowed rectification of error by assigning retrospective effect to subsequent Judgments on the basis of which writ petitions were filed. I feel that insofar as Customs and Excise is concerned, it is still a grey area but it is time some objective criteria are evolved and a line distinguishing a case of rectification of mistakes from that of review or recall is drawn. It is significant that in the present case no case w.r.t. the Customs Act under which the Tribunal has been constituted or the Excise Act w.r.t. which this case has arisen has been cited by either side.”
27. I have carefully considered the matter. Whether subsequent, decision of the Supreme Court can form the basis for rectifying the mistake in terms of Section 35C(2) of the Central Excise Act is an issue to be considered herein. It was submitted on behalf of the assessee that subsequent decision of the Apex Court would form basis for rectifying an order of the Tribunal and an application for rectification of mistake cannot be rejected on the ground that subsequent decision of the Supreme Court did not constitute a mistake apparent from the record, relying upon the decisions of the respective High Courts. It was also submitted that provisions relating to rectification of mistake under the provisions of the Income Tax and the Wealth Tax etc. referred to in the case law cited by them were pari-meteria with that of corresponding provisions under Customs and Excise law. On the other hand it was urged on behalf of the Revenue that Tribunal has no power to review its own order and while rectifying the mistake apparent from the record such review power cannot be exercised. It was further submitted that the decisions referred to by the other side were with reference to the provisions of other taxing statutes and in those cases the High Court have considered the matter while exercising the jurisdiction under Article 226 of the constitution.
28. On going through the pleas made by both sides I do not find any direct decision of the Apex Court on the point at issue. None of the decisions referred to by the assessee has dealt with the issue with reference to Section 35C(2) of the Central Excise Act or under Section 129C(2) of the Customs Act as pointed out by the departmental representative. It should be noted that the provisions under Section 35C(2) of the Central Excise Act or Section 129C(2) of the Customs Act are not in the nature of a review. The general rule is that once the Judicial order quasi judicial authority passes an order, after hearing the parties such an order becomes final so far as that authority is concerned and that the such authority has no further power to interfere with, order modify such an order, unless the statute under which that authority functions contains a suitable provision enabling that authority to do so. [1987 (32) E.L.T. 8 (S.C.)].
29. In the case of Saurashtra Cement & Chemicals Industries Ltd. v. C.C., Ahmedabad [1987 (29) E.L.T. 87 (T)] this Tribunal has taken a view that later decision of the Tribunal would not be a ground for rectification of mistake. Similar view was expressed even in the subsequent decision M.C. Desai v. Collector of Customs -1991 (56) E.L.T. 425 (Tribunal).
30. However, it may be seen that in matters arising under the Income Tax Act or under Wealth Tax it has been held in the cases referred to by the Counsel for the appellant that “an application for rectification would lie on the basis of a decision of the Supreme Court, though rendered subsequent to the order of the Tribunal, if there was no further investigation of facts involved and the principle of the Supreme Court decision could be straightaway applied to show that the decision already issued was mistaken”.
31. Delhi High Court while examining Section 254(2) of the Income Tax Act, 1961 corresponding to Section 35C(2) of Central Excise Act in the case of Deeksha Suri (supra) held that Tribunal has not been vested with the review jurisdiction by the statute creating it and the Tribunal does not have any power to review its own judgment. Further, it was held that what is not permitted by the statute having deliberately omitted to confer review jurisdiction on the Tribunal, cannot be indirectly achieved by recourse to Section 254(2) of Income Tax Act, 1961 corresponding to Section 35C(2) of the Central Excise Act, 1944. Further, Supreme Court in the case of Dokka Samuel (supra) held that the Omission to cite an authority of law is not a ground for reviewing the prior judgment saying that there is an error apparent on the face of the record. In view of these conflicting views and in view of importance of the subject matter it will be more appropriate to refer the matter to a Larger Bench and to resolve the issue. Accordingly, the view expressed by the Hon’ble Vice President is concurred with. Case file is returned to the original bench to pass an appropriate order.
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(G.A. Brahma Deva)
Member (J)
32. In the light of the majority view the issue as to whether a subsequent decision of the Tribunal or the High Court or the Supreme Court can form the basis for rectification of mistake in terms of Section 35C(2) of the Central Excise Act, is required to be referred to a Larger Bench.
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(G.R. Sharma) (Jyoti Balasundaram)
Member (T) Member (J)
Date : 14-12-1999 Date : 14-12-1999