THE issues before the Bench are - Whether the ITAT has inherent
jurisdiction to decide the question of law whether a former Member of the
Tribunal can practice before its Benches; Whether when the Allahabad HC has
decided the question of law, it is not prudent for the Special Bench not to
follow the same particularly when there is no dissenting order from any other
High Court and Whether an opinion given by the Attorney General can be construed
as the direction of
the Central Government. And the answers go against the
appellant.
Facts of the
case
On direction of the jurisdictional
High Court, the Tribunal constituted a Special Bench to decide the question
- Whether Shri
Deepak R. Shah, advocate and ex-Accountant Member of the Income Tax Appellate
Tribunal, is debarred from practicing before the Income Tax Appellate Tribunal
in view of the insertion of Rule 13 E in the Income Tax Appellate Tribunal
Members (Recruitment and Conditions of Service) Rules, 1963?
Having heard the parties,
the Bench held that,
++ we
have heard both the sides at length. We have noted that Sri Deepak R. Shah was
appointed as Accountant Member of the Income Tax Appellate Tribunal on 29th of
November, 2001. He was confirmed on 29.11.2003. Later on, he has resigned as a
Member of the Tribunal on 01.04.2010. At this juncture, it is worth to mention
that Rule 13-E in (Recruitment and Conditions of Services) Rules, 1963 was
inserted vide a notification dated 3rd of June, 2009;
++ at
the outset, it is worth to mention that whether this Special Bench is entitled
to decide the applicability of the provisions of Rule 13E of Members
(Recruitment and Conditions of Service) Rules, 1963. There is a cardinal Rule
that nemo debet esse judex in propria causa (no one should be a
judge in his own cause);
++ this question was raised in the case
of Concept Creations 2009-TIOL-571-ITAT-DEL-SB and a view was
taken that the Special Bench so constituted was competent to go into the said
question raised before the Bench. But at present that position has been altered.
At this juncture, it is also worth to mention that at present the legal position
is that the High Court Of Judicature at Allahbad, Lucknow Bench, in the
case of Dinesh Chandra Agarwal Vs. Union of India 2012-TIOL-77-HC-ALL-SERVICE
has held that the judgment rendered in the case of Concept Creations
was beyond its pale of tax appeals as contained in the Income
Tax Act, vide Sections 253 and 254 thereof;
++
hence the view taken by the Special Bench in the Concept Creation about
the competence of the Tribunal benches to hear service related issues, including
Special Bench, now stood reversed. Moreover, as on date, there is no other
decision of any other High Court before us. The Tribunal Benches as also the
Special Bench are subordinate to the High Courts. In the hierarchical judicial
system an accepted rule to follow a precedent is that, quote "the better wisdom
of the Court below has to yield to higher wisdom of the Court above. Once an
authority higher than the Tribunal has expressed an opinion on some issue, then
the Tribunal is no longer at liberty to rely upon its earlier decision, may be a
decision of the Special Bench" unquote. This is a settled rule hence even a
non-jurisdictional High Court order do not alter the position and therefore to
be followed, if not dissented;
++
hence, the Tribunal being a subordinate Court, is expected to follow in letter
and spirit an order of the High Court, unless and until either reversed by the
Apex Court or by an order of the Jurisdictional High Court taking a
contradictory view. Hence, the decision of the Special Bench pronounced in the
case of Concept Creation is no more a good law on this issue being
reversed by the Allahabad High Court. So the present legal position is
that the Tribunal has no inherent jurisdiction to decide the question as to
whether an Ex-Member of the Tribunal can appear and practice before the Income
Tax Tribunal Benches. Since, we have followed the decision of the
Allahabad High Court; therefore, certain allied question about the applicability
of the provisions of Section 288 of IT Act need not to be addressed by us in
this order. Likewise, the question of an appealable order before the Tribunal as
prescribed u/s.253 is not required to be adjudicated upon by us in the present
appeal. We are also not entertaining one of the arguments of learned Mr Shah
that in terms of Section 254 of IT Act the Appellate Tribunal is entitled to
"pass such orders thereon as it thinks fit";
++
resultantly our conscientious decision is that in the light of the decision of
the High Court it is beyond our jurisdiction to decide the issue on merits and
that part of the Concept Creation now stood overruled by the Allahbad
High Court. The vires of Rule 13E, whether it is ultra-vires or intra-vires, is
a subject not falling within our jurisdiction;
++
before us the Standing Counsel has referred Article 309 of the Constitution of
India which prescribes the Recruitment and Conditions of Service of persons
serving the Union or State. She has said that a particular legislature may
regulate the Recruitment and Conditions of Service of persons appointed to
public services and posts in connection with the affairs of the Union or of any
State. She has also pointed out that as per one of the proviso, it is prescribed
that it shall be competent for the President of India, or such person as may be
directed, in the case of Services and Posts to make rules regulating the
Recruitment and Conditions of Service of persons appointed and any rule so made
shall have effect subject to the provisions of any such Act. She has clarified
that the purpose of citing Article 309 of the Constitution of India is that if
Mr. Shah is aggrieved by the insertion of Rule 13E then he should have
approached the competent authority to decide the vires of Rule 13E. The Income
Tax Tribunal is not the correct forum for redressal of such grievance. She has
further clarified that the recruitment as a Member of the Tribunal is classified
under Rule 8 General Central Civil Services Class-I (Group-A Member), hence
Central Administrative Tribunal may be the proper forum to decide the
applicability of the provisions of Rule 13E of the notification. We find force
in this arguments of learned Standing Counsel; hence, put this controversy at
rest that the grievance being not emerging from an order of Tax Authorities as
prescribed under Section 253 of IT Act (order appealable before the Appellate
Tribunal), therefore this Tribunal is not competent to decide this issue which
is related to the service conditions of the Members;
++ it
is worth mentioning that both the sides, Ld. Mr. Shah as also Ms. Bhatt have
expressed with full sense of responsibility that the question referred to this
Special Bench being bonded with the legality of the Service Condition Rules
hence out of the jurisdiction of the Tribunal, therefore by giving due weight to
their acceptance of this legal position we hereby hold that the issue in hand do
not fall within our competence of jurisdiction. Needless to repeat again, this
view is fortified by the binding decision of Allahabad High Court;
++ an
another argument has also been raised that the Attorney General has given an
opinion which can be treated as an order of the Central Government; therefore,
Mr. Shah should be allowed to appear before the Tribunal. However, this argument
is also not in line with the judgment of the Allahabad High Court; hence,
deserves to be rejected. Moreover, the Central Government has not given any
decision in respect of Rule in question; hence, we are not convinced to hold
that an opinion can be treated as a decision of the Central
Government;
++
before we part with the issue, it is worth to mention that the Allahabad High
Court has fixed the date of hearing to decide the vires of Rule 13E and for that
purpose issued notice to the Attorney General of India; hence, at present it is
not legally justifiable to take up the merits of the issue. We hereby hold that
the question referred to us is beyond our jurisdiction.
++
the question referred to us is alieni juris hence forbidden to adjudicate
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