Withdrawal/Non-pressing of Grounds by Assessee’s Counsel isn’t Mistake Apparent from Records for Sec. 254 | ITAT

Case Details: M/s. Dhanwan Leasing and Finance Company Limited vs. ITO - [2024] 158 taxmann.com 44 (Indore-Trib.)

Judiciary and Counsel Details

• • Vijay Pal Rao, Judicial Member & B.M. Biyani, Accountant Member
  • Sumit Nema, Sr. Adv. Gagan Tiwari & Pankaj Shah for the Appellant.
  • Ashish Porwal, Sr. DR for the Respondent.

Facts of the Case

The assessee filed the instant application under section 254(2) seeking recall/rectification of the order passed by the Tribunal for Assessment Year 2010-11. Assessee contented that its appeal was wrongly dismissed by ITAT being not pressed by the Counsel at the desire of the assessee. The assessee raised the contention that the Counsel had no authorization to withdraw the ground raised by the assessee. Yet, the ITAT allowed the withdrawal of the appeal on such grounds.

ITAT Held

The Tribunal held that the assessee argued that Counsel didn’t have any authorization to withdraw the grounds raised by the assessee. In this regard, the ‘Letter of Authority’ filed by the assessee’s Counsel was reproduced. Considering the same, one can easily find that the assessee has given authority to his Counsel to appear and present the assessee before ITAT. Such authority was fullest, unlimited and unrestricted, and there was no rider mentioned therein.

Secondly, the assessee has specifically authorized his counsel “to compound matters wherever necessary” This compounding authorized the assessee’s Counsel to withdraw full or part of the appeal, i.e. one or more grounds.

Thus, the withdrawal or non-pressing of the ground by Counsel was within the power and the authority being representative of the assessee. Failure to raise ground during a hearing and later attempting to address it through a Section 254(2) application after an unfavourable decision by ITAT would set a dangerous precedent.

Hence, the claim by the assessee that the ITAT acknowledged withdrawal or non-pressing without Counsel’s authorization lacks merit.