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Shri Arun Malhotra Vs. Principal Commissioner Of Income Tax-2
June, 17th 2017
                     ITA 303/2017

       SHRI ARUN MALHOTRA                             ..... Appellant
                    Through:           Dr. Rakesh Gupta, Mr. Somil
                                       Aggarwal & Ms. Shyamlima Borah,


                    Through: Mr. Raghvendra Singh, Advocate


%                    17.05.2017

Dr. S. Muralidhar, J.:
1. This is the second round of litigation which, unfortunately, and inevitably
is, for reasons explained hereafter, going to lead to a third round of

2. This appeal by the Assessee under Section 260 A of the Income Tax Act
1961 ('Act') is directed against an order dated 28th October2016 passed by
the Income Tax Appellate Tribunal (ITAT) in IT(SS)A No. 77/De1/2012
and IT(SS)A No. 85/Del/2012 for Assessment Year (AY) 2009-10 and
Block Period.

3. Admit.

ITA No.303 of 2017                                               Page 1 of 5
4. Having heard learned counsel for the parties, the following question is
framed for determination:
       "Did the Income Tax Appellate Tribunal (,,ITAT) fail to adhere
       to the specific mandate issued to it by this Court in the previous
       order dated 25th November, 2013 in CIT v. Arun Malhotra
       (2014) 363 ITR 195(Del)?"

5. The background facts of the present case have been set-out in
considerable detail in the previous order of this Court in CIT v. Arun
Malhotra (supra) and need not be repeated in extenso. While setting aside
the previous order of the ITAT dated 5th August 20008, this Court directed
as follows:
       "24. In view of the aforesaid, we answer the questions of law in
       favour of the Revenue and against the respondent but with an
       order of remand to the tribunal to discuss the entire evidence in
       detail on all aspects. The issues and contentions will be examined
       afresh. Factual findings in this order and the impugned order will
       not be treated as conclusive and final. To cut short delay, we
       direct that the parties shall appear before the tribunal on 16 th
       December 2013, when a date of hearing shall be fixed."

6. The critical word in the above paragraph, which contains a direction, is
,,afresh. In other words, all the issues and contentions that arose in the
appeals before the ITAT had to be examined tabula rasa.

7. One of the principal contentions of the learned counsel for the Appellant
Assessee in the present appeal, was noted by this Court in its order dated
19th April 2017, as under:
       "2. It is stated by Dr. Rakesh Gupta, learned counsel appearing for
       the Appellant that a large portion of the impugned order of the
       ITAT is a mere reproduction of the order passed by this Court on

ITA No.303 of 2017                                               Page 2 of 5
       25th November 2013 in ITA Nos.923/2009 and 1157/2009
       whereby the earlier order of the ITAT was set aside and the matter
       was remanded to the ITAT for a fresh consideration. Prima facie,
       there appears to be no application of mind afresh by the ITAT
       particularly in the context of the specific directions issued by this
       court in its earlier order."

8. Both DR Rakesh Gupta, the learned counsel for the Assessee as well as
Mr Raghvendra Singh, learned counsel for the Revenue have referred to the
decision of the Supreme Court in CIT v. P.V. Kalyanasundaram (2007) 294
ITR 49(SC), where one of the contentions of the Revenue in challenging the
order of the Madras High Court was that the judgment under challenge "had
merely plagiarized substantial portions from the order of the Commissioner
and Tribunal in arriving at its conclusion and no independent assessment on
the questions of law that arose for consideration, had been made. " Although
the Supreme Court ultimately dismissed the appeal of the Revenue, it
       "We feel that quoting from an order of some authority
       particularly a specialized one cannot per-se be faulted as this
       procedure can often help in making for brevity and precision, but
       we agree with Mr. Vahanvati to the extent that any 'borrowed
       words' used in a judgment must be acknowledged as such in any
       appropriate manner as a courtesy to the true author(s)."

9. If one peruses the impugned order of the ITAT in the present case, it is
unmistakable that large portions of it have been virtually lifted verbatim
from the order of the Assessing Officer (,,AO) as well as the order of this
Court by which the matter was remanded to it. Worse still, these portions are
not placed in quotation marks. Contrary to what was expected to be done, as
explained by the Supreme Court in CIT v. P.V. Kalyanasundaram (supra),

ITA No.303 of 2017                                                Page 3 of 5
there is no attribution by the ITAT in the impugned order to the source from
which the said portions have been lifted.

10. It was earnestly contended by Mr Raghvendra Singh, learned counsel for
the Revenue, that this Court should ignore these aberrations in the impugned
order of the ITAT and proceed to decide the matter on merits by treating the
impugned order as having dealt with all the issues and contentions by either
agreeing with or adopting the reasoning either of the AO or even this Court.

11. The Court is unable to agree with the above submission. There was a
specific mandate before the ITAT that had been spelt out in para 24 of this
Courts previous order. The ITAT was to consider afresh all the issues and
contentions that arose before it. That the ITAT simply failed to do. It has
chosen to adopt a shortcut by verbatim reproducing the portions of the order
of the assessment order or the order of this Court whether for the purposes
of setting out the facts or even the reasoning and conclusion. It is one thing
the ITAT to quote from an order of the AO or the CIT (A) and then explain
whether the ITAT agreed with or differed from the said portion. It is another
to simply incorporate into the order those very words and passages without
any attribution to the source leaving the reader wondering if that could be
the actual reasoning of the ITAT. The present impugned order of the ITAT
falls in the latter category.

12. Looking at it from any point of view, the Court is unable to accept the
impugned order of the ITAT as having satisfied the mandate of this Court,
as spelt out in para 24 of its earlier order extracted hereinbefore.

ITA No.303 of 2017                                                     Page 4 of 5
13. Consequently, the question framed is answered in the affirmative i.e. in
favour of the Assessee and against the Revenue. The Court hereby sets aside
the impugned order dated 28th October2016 passed by the ITAT and
restores to its file IT(SS)A No. 77/De1/2012 and IT(SS) A No. 85/Del/2012.
The above appeals shall be listed in the ITAT on 17th July, 2017 for
directions before a Bench of which the author of the impugned order is not a

14. The Court is further constrained to direct that since this will be the third
round of litigation, the ITAT will, after hearing the parties, endeavour to
deliver a final decision in the appeals not later than six months from the date
it first hears them after this remand.

15. The appeal is disposed of in the above terms.

                                                        S.MURALIDHAR, J

                                                  CHANDER SHEKHAR, J
MAY 17, 2017

ITA No.303 of 2017                                                Page 5 of 5
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