CIT vs. Meghalaya Steels Ltd. [2015] 377 ITR 112 (SC)
In the first judgment of the High Court dated 16th September, 2010, various points on the merits were gone into, inter alia, as to whether deductions to be made u/s. 80-IB of the Income-tax Act, 1961, were allowable on facts and whether transport subsidies were or were not available together with other incentive. Ultimately, the High Court after stating in paragraph 2 that two substantial questions of law arose u/s. 260A of the Income-tax Act went on to answer the two questions. The first question so framed was answered in the negative, that is in favour of the Revenue, and against the assessee. However, the second question was answered in the affirmative, in favour of the assessee, and against Revenue, and the appeal was disposed of in the aforesaid terms.
Against the aforesaid judgment dated 16th September, 2010, a Review Petition was filed by the assessee before the very Division Bench. In a long judgement dated 8th April, 2013, the Division Bench recalled its earlier order dated 16th September, 2010 for the reason that there was an omission to formulate the substantial questions of law. Before the Supreme Court Learned Senior Advocate appearing on behalf of the Revenue, assailed the aforesaid judgment dated 8th April, 2013, stating that it was factually incorrect that no substantial question of law have been framed and that such questions were to be found in the very beginning of the judgment dated 16th September, 2010, itself. He further argued, referring to section 260A(7), that only those provisions of the Civil Procedure Code could be looked into for the purposes of section 260A as were relevant to the disposal of appeals, and since the review provision contained in the Code of Civil Procedure were not so referred to, the High Court would have no jurisdiction u/s. 260A to review such judgment.
The Supreme Court noted that by the review order dated 8th April, 2013, the Division Bench felt that it should not have gone into the matter at all given the fact that on an earlier occasion, before 16th September, 2010, it had reserved the judgment on whether substantial questions of law in fact exist at all or not. This being the case, in a lengthy order the Division Bench has thought it fit to recall its own earlier judgment.
The Supreme Court in such circumstances was not inclined to interfere with the judgment in view of what had been recorded in the impugned judgment dated 8th April, 2013. The Supreme Court further held that High Courts being courts of record under article 215 of the Constitution of India, the power of review would in fact be inherent in them. Also on reading of section 260A(7), it was clear that the said section did not purport in any manner to curtail or restrict the application of the provisions of the Code of Civil Procedure. Section 260A(7) only states that all the provisions that would apply qua appeals in the Code of Civil Procedure would apply to appeals u/s. 260A. That does not in any manner suggest either that the other provisions of the Code of Civil Procedure are necessarily excluded or that the High Court’s inherent jurisdiction is in any manner affected.
