Karnataka High Court
The Pr Commissioner Of Income Tax-3 vs Chandramouli on 10 October, 2025
Author: S.R.Krishna Kumar
Bench: S.R.Krishna Kumar
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NC: 2025:KHC:40223
WP No. 26741 of 2023
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 10TH DAY OF OCTOBER, 2025
BEFORE
THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR
WRIT PETITION NO. 26741 OF 2023 (T-IT)
BETWEEN:
1. THE PR. COMMISSIONER OF INCOME TAX - 3,
5TH FLOOR, BMTC BUILDING,
6TH BLOCK, 80 FEE ROAD,
KORAMANGALA,
BENGALURU - 560 095
2. THE INCOME TAX OFFICER
WARD 1(1),
NO. 21/16, AAYAKAR BHAVAN,
RESIDENCY ROAD,
NAZARBAD,
MYSURU - 570 010
...PETITIONERS
(BY SRI. M. DILIP, ADVOCATE)
AND:
Digitally signed
by CHANDANA CHANDRAMOULI,
BM NO 748/3, GANGA ENGINEERING WORKS
Location: High HUNSUR ROAD YELWAL,
Court of MYSURU - 571 130
Karnataka KARNATAKA
...RESPONDENT
(VIDE ORDER DATED 10.10.2025, NOTICE TO RESPONDENT
IS DISPENSED WITH)
THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE
CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER DATED
26.05.2023 BEARING M.P. NO. 98/BANG/2023 (IN ITA NO.
3/BANG/2022) PASSED BY THE 2ND RESPONDENT PRODUCED AS
ANNEXURE-A.
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NC: 2025:KHC:40223
WP No. 26741 of 2023
HC-KAR
THIS PETITION, COMING ON FOR ORDERS, THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR
ORAL ORDER
In this petition, the petitioner seeks the following reliefs:
"a. Issue a writ of certiorari to quash the order dated 26.05.2023 bearing M.P.No.98/Bang/2023 (in ITA No.3/Bang/2022) passed by the second respondent produced as Annexure-A. b. Issue such other Writ or directions deems fit to grant in the facts and circumstances of the present case in the interest of justice and equity."
2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record.
3. Though several contentions have been urged by both sides in support of their respective claims, the issue in controversy between the parties is directly and squarely covered by the judgment of the Co-ordinate Bench of this Court in the case of Deputy Commissioner of Income Tax Vs. M/s OT Privacy Software Pvt., Ltd., - W.P.No.12837/2024 dated 15.09.2025, wherein it was held as under;
-3-NC: 2025:KHC:40223 WP No. 26741 of 2023 HC-KAR "The petitioner - Deputy Commissioner of Income Tax Department is at the doors of this Court calling in question an order dated 16.06.2023, passed by the Income Tax Appellate Tribunal, 'C' Bench, Bengaluru ('the Tribunal' for short) rejecting Miscellaneous Petition No.119/Bang/2023, in ITA.No.755/Bang/2021 for the assessment year 2019-20.
2. Learned counsel for petitioner submits that the issue in the lis stands answered by this Court in the case of DEPUTY COMMISSIONER OF INCOME TAX Vs. M/S BRUSH TECH INDIA in W.P.No.27089/2023, disposed on 30.07.2025.
3. This Court in the aforesaid writ petition, has held as follows:
"9. The afore-narrated facts and link in the chain of events are all a matter of record. The only issue that calls for consideration is, whether a subsequent change in law would take away the adjudication that has already undergone to follow. The revenue seeks review of the order of the Tribunal in the light of the judgment rendered by the Apex Court in CHECKMATE SERVICES PRIVATE LIMITED v. COMMISSIONER OF INCOME TAX-11. This is an admitted fact. Whether subsequent law being laid down become the subject matter of review of already concluded proceeding is necessary to be noticed. The Apex court in the case of SANJAY KUMAR AGARWAL v. STATE TAX OFFICER2, has held as follows:1
(2023) 6 SCC 451 2 (2024) 2 SCC 362 -4- NC: 2025:KHC:40223 WP No. 26741 of 2023 HC-KAR "15. It is very pertinent to note that recently the Constitution Bench in Beghar Foundation v. K.S. Puttaswamy (Aadhaar Review-5 J.) [Beghar Foundation v. K.S. Puttaswamy (Aadhaar Review-5 J.), (2021) 3 SCC 1] , held that even the change in law or subsequent decision/judgment of coordinate Bench or larger Bench by itself cannot be regarded as a ground for review.
... ...
...
16.8. Even the change in law or
subsequent decision/judgment of a
coordinate or larger Bench by itself cannot be regarded as a ground for review."
(Emphasis supplied) The Apex Court holds that in BEGHAR FOUNDATION, a five Judge Bench holds that even the change in law or subsequent decision/judgment of a Coordinate Bench or a larger Bench cannot by itself be regarded as a ground for review. The Apex Court was following the judgment of the Constitution Bench in BEGHAR FOUNDATION v. JUSTICE K.S. PUTTASWAMY3, wherein the Apex Court holds as follows:
"2. The present review petitions have been filed against the final judgment and order dated 26-9- 2018 [K.S. Puttaswamy (Aadhaar-5 J.) v. Union of India, (2019) 1 SCC 1]. We have perused the review petitions as well as the grounds in support thereof. In our opinion, no case for review of judgment and order dated 26-9-2018 [K.S. Puttaswamy (Aadhaar-5 J.) v. Union of India, (2019) 1 SCC 1] is made out. We hasten to add that change in the law or subsequent decision/judgment of a coordinate or larger Bench by itself cannot be regarded as a ground for review. The review petitions are accordingly dismissed."
(Emphasis supplied) The Tribunal while deciding the issue had followed the judgment of the High Court of Himachal Pradesh in COMMISSIONER OF INCOME TAX v.
3(2021) 3 SCC 1 -5- NC: 2025:KHC:40223 WP No. 26741 of 2023 HC-KAR NIPSO POLYFABRIKS LIMITED4. Relief was granted to the assessee following the aforesaid Division Bench judgment. This is subsequently reversed by the Apex Court in the case of CHECKMATE SERVICES PRIVATE LIMITED (supra).
10. As observed by the Apex Court, a subsequent change in law would not exhume already decided adjudication. At best it would become applicable to subsequent adjudications. As on the date, the Tribunal rendered its order, the law as obtaining on the day was followed. The law changed a year later. Change of law, a year later, would not mean that concluded proceeding can be revived. If this would be permitted, it would lead to chaotic circumstances.
11. The High Court of Bombay considered an identical circumstance in PRAKASH D. KOLI's case supra following the afore-quoted judgments. The High Court of Bombay has held as follows:
".... .... ....
6. In light of this decision of the Hon'ble Supreme Court, and which was rendered on 12th October, 2022, the Revenue moved a Rectification Application before the ITAT by invoking the provisions of Section 254 (2) of the IT Act. It is in this Rectification Application that the impugned order is passed, wherein the Tribunal has allowed the Miscellaneous Application filed by the Revenue, and holding that the disallowance made by the Assessing Officer is sustained.
7. The only ground on which the Rectification is allowed is on the basis of the judgment of the Hon'ble Court in Checkmates Services (supra) As mentioned earlier, this judgment was rendered by the Hon'ble Supreme Court on 12th October, 2022 which is after the date when the original order was passed by the ITAT on 22nd June, 2022 holding that the Assessee was entitled to this deduction under Section 36 (1)(va).
8. Having heard the learned Counsel for the parties, we agree with the learned 4 2012 SCC OnLine HP 6967 -6- NC: 2025:KHC:40223 WP No. 26741 of 2023 HC-KAR Counsel appearing on behalf of the Petitioner that a subsequent ruling of the Hon'ble Supreme Court cannot be a ground for invoking the provisions of Section 254 (2) Section 254 (2) can be invoked with a view to rectify any mistake apparent from the record and not otherwise Admittedly, on the date when the original order was passed by the ITAT on 22nd June, 2022, it followed the law as it stood then That was overruled subsequently by the Hon'ble Supreme Court in Checkmates Services (supra) Hence, we are of the view, that on the date when the Tribunal passed its original order (on 22nd June, 2022), it could not be said that there was any error or mistake apparent on the record, giving jurisdiction to the Tribunal to invoke Section 254(2) of the IT Act
9. We find that the view that we take is squarely covered by a Division Bench decision of this Court in the case of Infantry Security and Facilities v Income Tax Officer [Writ Petition No 17175 and other connected matters, dated 3-12-2024]. The Division Bench in Infantry Securities and Facilities (supra) was concerned with the exact same decision of the Hon'ble Supreme Court in Checkmates Services (supra). The Division Bench, after examining the law on the subject, came to the conclusion that the Tribunal was in patent error in exercising jurisdiction under Section 254(2), and passing the impugned order. The relevant portion of this decision read thus-
14. In our clear opinion, the question would be required to be answered against the Revenue and in favour of the assessee The reasons for which we discuss hereunder In such context, at the outset, we may observe that the petitioner had succeeded before the Tribunal on the basis of the position in law as it prevailed on the day the decision was rendered on the petitioner's appeal on 26 July 2022. Subsequent to the said orders passed by the Tribunal, on 12 October 2022, the Supreme Court rendered its decision in "Checkmate Services Private Limited" (supra), whereby the Supreme Court held that the deduction of the employees' share can be allowed under Section 36(1)(va) of the IT Act, only if such share was deposited before the time limit under the respective statutes and not before the due date under Section 139(1) of the IT Act. In the fact situation, certainly it cannot be said -7- NC: 2025:KHC:40223 WP No. 26741 of 2023 HC-KAR that the Tribunal has overlooked the existing position in law, as laid down by the Supreme Court or the High Court, so as to bring about a situation that the law declared by the Supreme Court was not followed by the Tribunal and/or the decision of the Tribunal is contrary to the law as laid down by the Supreme Court. Such decision of the Supreme Court which never existed when the Tribunal passed the original order could never have been applied by the Tribunal, and hence it cannot be said that there was any mistake on the face of the record, so as to confer jurisdiction on the Tribunal to exercise its jurisdiction under Section 254(2) of the IT Act.
16. In so far as the petitioner's contention on the jurisdiction of the Tribunal to entertain the Miscellaneous Application is concerned, it appears that the position in law is well settled. The jurisdiction as conferred under sub-Section(2) of Section 254 is akin to the jurisdiction conferred on the Civil Court under the provisions of Order XLVII, Rule 1 of the CPC inter alia to correct mistakes apparent on the face of the record. However, on a comparative reading of sub-Section (2) of Section 254 of the IT Act, and Rule 1 of Order XLVII of CPC, it appears that such jurisdiction conferred on the Tribunal is more restricted.
17. In Beghar Foundation (supra), the Supreme Court was considering a review petition, filed against the final judgment and order dated 26 September 2018, passed on the main proceedings. In rejecting the review petition, the Supreme Court observed that no case for review of such judgment was made out, and most importantly on the ground that change in law or subsequent decision/judgment of coordinate or larger bench by itself cannot be regarded as a ground for review. Such principles of law are squarely applicable in the facts of the present case.
18. In Sanjay Kumar Agrawal v. State Tax Officer (1) and Another, the Supreme Court following the decision in the Constitution Bench in Beghar Foundation (supra), made the following observations:
"15 It is very pertinent to note that recently the Constitution Bench in Beghar Foundation v K. S Puttaswamy (Aadhaar Review 5 J.), held that even the change in law or subsequent decision/judgment of coordinate Bench or larger Bench by itself cannot be regard as a ground for review."-8-
NC: 2025:KHC:40223 WP No. 26741 of 2023 HC-KAR
19. We may observe that recently a bench of the Tribunal in the case of ANI Integrated Services Ltd (supra), had the occasion to consider the very issue as raised by the Revenue in light of the decision rendered by the Supreme Court in Checkmate Services Private Limited (supra). In such case similar applications were filed by the Revenue praying that the Tribunal set aside its orders in relation to Employees State Insurance Corporation ("ESIC" for short) (for the Assessment Year 2019-20) considering the changed position in law in "Checkmate Services Private Limited" (supra). The Tribunal by its decision dated 29 May 2024 [ANI Integrated Services Limited (supra)] did not accept the contentions as urged on behalf of the Revenue and rejected the Miscellaneous Applications filed by the Revenue, also considering the decision in Beghar Foundation (supra) and the scope of its limited jurisdiction under Section 254(2) of the IT Act. We are in complete agreement with the view taken by the Tribunal in ANI Integrated Services Ltd (supra) and which is on the very issue as urged by the petitioner."
Not only do we agree with this decision, but we are also bound by it.
10. In light of the aforesaid discussion, we are of the view that this Petition deserves to be allowed. Accordingly, the Writ Petition is allowed in terms of prayer clause (a) which reads thus:-
"(a) to issue a Writ of Certiorari or a Writ in the nature of Certiorarı or any other appropriate Wnt, Order or direction, calling for the records of the Petitioner's case and after going into the legality and propriety thereof, to quash and set aside the impugned Order dated 4th August 2023 and Order giving effect dated 26th October 2023 and thereby restoring back the Order dated 22nd June 2022 passed u/s. 254 (1) ofthe ITA."
11. Rule is made absolute in the aforesaid terms and the Writ Petition is also disposed of in terms thereof However, there shall be no order as to costs.
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12. We may clarify here that by virtue of this order, the Revenue is not precluded from challenging the original order passed by the ITAT dated 22nd June, 2022 under Section 260A of the IT Act, if they are otherwise entitled to in law."
(Emphasis supplied)
12. In the light of the law being clear, though the reason so rendered by the Tribunal to reject the application is debatable, the said issue need not result in the matter being remitted back to the hands of the Tribunal for fresh consideration, only to follow the afore-quoted law and pass necessary orders.
In the light of the afore-quoted judgment of this Court, which covers the issue on all its fours, finding no merit in the petition, the petition stands rejected."
4. Under these identical circumstances, I deem it just and appropriate to dismiss the present petition also in terms of the aforesaid judgment of the Co-ordinate Bench of this Court.
5. Accordingly, the petition is hereby dismissed.
Sd/-
(S.R.KRISHNA KUMAR) JUDGE MDS List No.: 2 Sl No.: 70