# Distributors India, (South) v. Union of India & Ors. Opp. Parties

- **Citation:** (2022) 5 ILRA 1373
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2022-05-24
- **Case number:** Civil Misc. Review Application No. 116 of 2022
- **Bench:** Devendra Kumar Upadhyaya, Subhash Vidyarthi
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/distributors-india-south-v-union-of-india-ors-opp-parties-48507
- **Pages:** 7

## Headnote

A. Civil Law - Civil Procedure Code,
1908 - ORDER 47 RULE 1 - It is settled
law that review cannot be treated as an
appeal and a re-hearing of the matter is not
allowed in the name of a review of the
judgment. Review of a judgment can be
sought only the ground that it suffers from
an "error apparent on the face of the
record". But error on the face of record must
be such an error which must strike one on
mere looking at the record and would not
require any long-drawn process of reasoning
on the points where there may conceivably
be two opinions.
B. Power of review may not be exercised on the
ground that the decision was erroneous on
merits.

C. Power of review can also be exercised for
any sufficient reason which is wide enough to
include a misconception of fact or law by a court
or even an advocate.

D. The power of review can be exercised for
correction of a mistake but not to substitute a
view. Such powers can be exercised within the
limits of the statute dealing with the exercise of
power. The review cannot be treated like an
appeal in disguise.

Application dismissed. (E-12)

List of Cases cited:-

## Text

5 All. Distributors India, (South) Vs. Union of India & Ors.
1373

29. Any observations made by this
Court in this order have only been made to
come
to
the
conclusion
regarding
justifiability of the orders impugned passed
by the Trial Court and the Appellate Court
and such observations shall not prejudice
the rights of any of the parties in the Suit
which is yet to be decided on merits by the
competent court.

30. This petition is accordingly
disposed of.
----------
(2022)05ILR A1373
REVISIONAL JURISDICTION
CIVIL SIDE
DATED: LUCKNOW 24.05.2022

BEFORE

THE HON'BLE DEVENDRA KUMAR
UPADHYAYA, J.
THE HON'BLE SUBHASH VIDYARTHI, J.

Civil Misc. Review Application No. 116 of 2022

Distributors India, (South) ...Applicant
Versus
Union of India & Ors. ...Opp. Parties

Counsel for the Applicant:
Shailesh Verma

Counsel for the Opp. Parties:
A.S.G.I., Manish Misra

A. Civil Law - Civil Procedure Code,
1908 - ORDER 47 RULE 1 - It is settled
law that review cannot be treated as an
appeal and a re-hearing of the matter is not
allowed in the name of a review of the
judgment. Review of a judgment can be
sought only the ground that it suffers from
an "error apparent on the face of the
record". But error on the face of record must
be such an error which must strike one on
mere looking at the record and would not
require any long-drawn process of reasoning
on the points where there may conceivably
be two opinions.
B. Power of review may not be exercised on the
ground that the decision was erroneous on
merits.

C. Power of review can also be exercised for
any sufficient reason which is wide enough to
include a misconception of fact or law by a court
or even an advocate.

D. The power of review can be exercised for
correction of a mistake but not to substitute a
view. Such powers can be exercised within the
limits of the statute dealing with the exercise of
power. The review cannot be treated like an
appeal in disguise.

Application dismissed. (E-12)

List of Cases cited:-

1. Raymond Woollen Mills Ltd. Vs I.T.O. (1999)
236 ITR 36 (SC); Arun Gupta Vs U.O.I., (2015)
371 ITR 394 (AII)

2. Phool Chand Bajrang Lal Vs ITO, (1993) 4
SCC 77; Srikrishna (P) Ltd. Vs ITO, (1996) 9
SCC 534

3. Meera Bhanja Vs Nirmala Kumari Choudhury,
(1995) 1 SCC 170

4. Perry Kansagra Vs Smriti Madan Kansagra,
(2019) 20 SCC 753

5. Srikrishna (Pvt.) Ltd. Vs I.T.O., (1996) 9 SCC
534

6. Aventis Pharma Ltd. Vs ACIT, (2010) 323 ITR
570 (Bom)

7. Arun Gupta Vs U.O.I., (2015) 371 ITR 394
(All)

8. United Electrical Co. Ltd. Vs Commissioner of
Income Tax, (2002) 258 I.T.R. 317
(Delivered by Hon'ble Devendra Kumar
Upadhyaya, J. & Hon'ble Subhash
Vidyarthi, J.)

1. Heard Shri Desh Deepak Chopra,
Senior Advocate, assisted by Sri Shailesh
1374 INDIAN LAW REPORTS ALLAHABAD SERIES
Verma, Advocate, the learned Counsel for
the petitioner and Shri Manish Misra,
Advocate, the learned counsel for the
respondents.

2. The petitioner has sought a review
of the judgment and order dated 18-042022 passed by this Court dismissing its
writ petition, which was filed challenging
the validity of a notice dated 26-03-2021
issued under Section 148 of the Income
Tax Act, 1961.

3. In the reasons recorded for
initiating the re-assessment proceedings,
the Assessing Officer has recorded that on
examination of the documents on record
and 26 AS, it was noticed that the petitioner
has received payment under Section 194 J
also, but it did not show the said receipts in
its Profit and Loss Account and did not
give any explanation for the same. The
Assessing Officer has further recorded that
the petitioner did not disclose the amount
of reimbursement of expenses claimed by it
and the actual amount received by it
towards reimbursement; that it did not
submit the details of the expenses incurred
by it for verification and it did not produce
the ledgers, bills and vouchers of expenses
incurred on behalf of the Principal
companies and that as per 26 AS the total
receipts
of
the
petitioner
were
Rs.4,66,84,247/-
and
the
TDS
was
Rs.32,14,869/- whereas it has shown its
income at Rs.3,59,59,861/- which is short
by Rs.1,07,24,386/- and this income
appears to have escaped assessment. The
Assessing
Officer
has
recorded
that
although the petitioner had produced the
books of account, annual report, Profit and
Loss Account and balance-sheet, but the
requisite material facts were embedded in
such a manner that the same could not be
discovered by the Assessing Officer and it
came to light upon investigation conducted
subsequent to passing of the assessment
order, which would amount to fresh
tangible material giving rise to reason to
believe that certain income has escaped
assessment
necessitating
initiation
of
reassessment proceedings.

4. After examining the reasons, this
Court had held that the A.O. had recorded
his reasons to believe that the petitioner had
received payments under Section 194 J
also, but it had not shown the said receipts
in his Profit and Loss account and had not
given any explanation for the same. The
petitioner had not disclosed the amount of
reimbursement of expenses claimed by it
and the actual amount received by it
towards
reimbursement.
It
had
not
submitted the details of expenses incurred
by it for verification during the assessment
proceedings. It did not produce any ledger,
bills and vouchers of expenses incurred on
behalf of the Principal Companies. Thus
the petitioner did not make a "full and true"
disclosure of all the material facts which
resulted in an income of Rs. 1,07,24,386/-
having escaped assessment.

5. Relying upon the judgments in
Raymond Woollen Mills Ltd. Vs. I.T.O.
(1999) 236 ITR 36 (SC); Arun Gupta Vs.
Union of India, (2015) 371 ITR 394 (AII);
Phool Chand Bajrang Lal Vs. ITO, (1993) 4
SCC 77; Srikrishna (P) Ltd. V. ITO, (1996)
9 SCC 534, this Court had held that while
scrutinizing a notice under Section 148 of the
Act in exercise of our power of judicial
review, we can only see whether there was
prima facie some material available on record
before the Assessing Officer for issuing a
notice for re-assessment and we do not have
to give a final decision regarding whether
there is a suppression of material facts or
regarding the sufficiency or correctness of the
5 All. Distributors India, (South) Vs. Union of India & Ors.
1375
material. The notice under Section 148 of the
Act has been issued by the Assessing Officer
after an Investigation was conducted and
going through the income tax return and other
related documents of the petitioner and after
forming a reason to believe that the petitioner
did not truly and fully disclose all the
material facts, because of which income
amounting to Rs. 1,07,24,386/- has escaped
assessment. This Court held that there was
prima facie material available on record
before the Assessing Officer for issuing a
notice under Section 148 for initiating
reassessment proceedings. For the aforesaid
reasons, the writ petition filed for quashing of
the notice issued under Section 148 of the
Act and the consequential proceedings was
dismissed.

6. The petitioner has filed the instant
application for review of the aforesaid
judgment passed by this Court dismissing the
Writ Petition.

7. Before proceeding to examine the
submissions of the learned Counsel for the
review-petitioner, it would be appropriate
to have a look at the scope of review. It is
settled law that review cannot be treated as
an appeal and a re-hearing of the matter is
not allowed in the name of a review of the
judgment. Review of a judgment can be
sought only the ground that it suffers from
an "error apparent on the face of the
record". The meaning of the expression
"error apparent on the face of the record"
has been explained by the Hon'ble Supreme
Court in various decisions, some of are
being referred hereinbelow.

8. In Meera Bhanja v. Nirmala
Kumari Choudhury, (1995) 1 SCC 170,
the Hon'ble Supreme Court explained the
term "error apparent on the face of the
record" in the following words: -

"an error apparent on the face of
record must be such an error which must
strike one on mere looking at the record
and would not require any long-drawn
process of reasoning on points where
there may conceivably be two opinions.
We may usefully refer to the observations
of this Court in the case of Satyanarayan
Laxminarayan
Hegde
v.
Mallikarjun
Bhavanappa Tirumale AIR 1960 SC 137,
wherein, K.C. Das Gupta, J., speaking for
the
Court
has
made
the
following
observations in connection with an error
apparent on the face of the record:

An error which has to be established
by a long-drawn process of reasoning on
points where there may conceivably be two
opinions can hardly be said to be an error
apparent on the face of the record. Where
an alleged error is far from self-evident and
if it can be established, it has to be
established, by lengthy and complicated
arguments, such an error cannot be cured
by a writ of certiorari according to the rule
governing the powers of the superior court
to issue such a writ."

(Emphasis Supplied)

9. In Perry Kansagra v. Smriti
Madan Kansagra, (2019) 20 SCC 753, the
Hon'ble Supreme Court referred to the
earlier
decisions
on
the
point
and
summarized the law on the subject in the
following manner: -

"15.1.In Inderchand Jain (2009) 14
SCC 663 it was observed in paras 10, 11
and 33 as under: (SCC pp. 669 & 675)

"10. It is beyond any doubt or dispute
that the review court does not sit in appeal
over its own order. A rehearing of the
matter
is
impermissible
in
law.
It
constitutes an exception to the general
rule that once a judgment is signed or
pronounced, it should not be altered. It is
1376 INDIAN LAW REPORTS ALLAHABAD SERIES
also trite that exercise of inherent
jurisdiction is not invoked for reviewing
any order.

11. Review is not appeal in disguise.
In Lily Thomas v. Union of India (2000) 6
SCC 224 this Court held: (SCC p. 251,
para 56)

''56. It follows, therefore, that the
power of review can be exercised for
correction of a mistake but not to substitute
a view. Such powers can be exercised
within the limits of the statute dealing with
the exercise of power. The review cannot
be treated like an appeal in disguise.'
***

33. The High Court had rightly
noticed the review jurisdiction of the court,
which is as under:

''The law on the subject--exercise of
power of review, as propounded by the
Apex Court and various other High Courts
may be summarised as hereunder:

(i) Review proceedings are not by way
of appeal and have to be strictly confined
to the scope and ambit of Order 47 Rule 1
CPC.

(ii) Power of review may be exercised
when some mistake or error apparent on
the fact of record is found. But error on
the face of record must be such an error
which must strike one on mere looking at
the record and would not require any
long-drawn process of reasoning on the
points where there may conceivably be two
opinions.

(iii) Power of review may not be
exercised on the ground that the decision
was erroneous on merits.

(iv) Power of review can also be
exercised for any sufficient reason which is
wide enough to include a misconception of
fact or law by a court or even an advocate.

(v) An application for review may be
necessitated by way of invoking the
doctrine actus curiae neminem gravabit.'

In our opinion, the principles of law
enumerated by it, in the facts of this case,
have wrongly been applied."

15.2.In Ajit Kumar Rath(1999) 9 SCC
596, it was observed: (SCC p. 608, para
29)

"29. In review proceedings, the
Tribunal deviated from the principles laid
down above which, we must say, is wholly
unjustified and exhibits a tendency to
rewrite
a
judgment
by
which
the
controversy had been finally decided. This,
we are constrained to say, is not the scope
of review under Section 22(3)(f) of the
Administrative Tribunals Act, 1985...."

15.3.Similarly, in Parsion Devi (1997)
8 SCC 715 the principles were summarised
as under: (SCC p. 719, para 9)

"9. Under Order 47 Rule 1 CPC a
judgment may be open to review inter alia
if there is a mistake or an error apparent
on the face of the record. An error which is
not self-evident and has to be detected by a
process of reasoning, can hardly be said to
be an error apparent on the face of the
record justifying the court to exercise its
power of review under Order 47 Rule 1
CPC. In exercise of the jurisdiction under
Order 47 Rule 1 CPC it is not permissible
for an erroneous decision to be "reheard
and corrected". A review petition, it must
be remembered has a limited purpose and
cannot be allowed to be "an appeal in
disguise"."

16.On the other hand, reliance was
placed by the respondent on the decision in
BCCI v. Netaji Cricket Club(2005) 4 SCC
741 to submit that exercise in review would
be justified if there be misconception of fact
or law. Para 90 of the said decision was to
the following effect: (SCC p. 765)

"90. Thus, a mistake on the part of the
court which would include a mistake in the
nature of the undertaking may also call for
a review of the order. An application for
5 All. Distributors India, (South) Vs. Union of India & Ors.
1377
review would also be maintainable if there
exists sufficient reason therefor. What
would constitute sufficient reason would
depend on the facts and circumstances of
the case. The words "sufficient reason" in
Order 47 Rule 1 of the Code are wide
enough to include a misconception of fact
or law by a court or even an advocate. An
application for review may be necessitated
by way of invoking the doctrine actus
curiae neminem gravabit."

17.We have gone through both the
judgments of the High Court in the instant
case and considered rival submissions on
the point. It is well settled that an error
which is required to be detected by a
process of reasoning can hardly be said to
be an error apparent on the face of the
record. To justify exercise of review
jurisdiction, the error must be self-evident.
Tested on this parameter, the exercise of
jurisdiction in the present case was not
correct. The exercise undertaken in the
present case, in our considered view, was
as if the High Court was sitting in appeal
over the earlier decision dated 17-2-2017.
Even assuming that there was no correct
appreciation of facts and law in the earlier
judgment, the parties could be left to
challenge the decision in an appeal. But
the review was not a proper remedy at all.
In our view, the High Court erred in
entertaining the review petition and
setting aside the earlier view dated 17-22017."

 (Emphasis Supplied)

10. Now we proceed to examine the
grounds taken by the petitioner for seeking
a review of the judgment passed by this
Court so as to ascertain whether this
judgment sought to be reviewed suffers
from any such error as strikes on mere
looking at the record and as would not
require
any
long-drawn
process
of
reasoning
for
being
established
and
regarding
which
there
may
not
be
conceivably be two opinions.

11. The petitioner has sought a review
of the aforesaid judgment on the ground
that the payments made under Section 194
J are clearly reflected in 26 AS and the
same had been reconciled by the Assessing
Officer during the original assessment
proceedings and the difference between the
receipts reflected in 26-AS and those
reflected in its Profit and Loss Account had
been explained through its letter dated 1202-2015.

12. Whether or not certain receipts are
correctly reflected in 26 AS and the Profit
and Loss Account of the petitioner, is a
disputed question of fact which cannot be
decided by this Court in exercise of its writ
jurisdiction under Article 226 of the
Constitution of India or while reviewing
the judgment passed in exercise of its writ
jurisdiction. Moreover, by raising the
aforesaid question, the petitioner is seeking
a re-hearing of the Writ Petition, which is
not permissible in the name review of the
judgment. Such a question can only be
decided by the Assessing Authority during
re-assessment
proceedings,
and
the
petitioner will have full opportunity to
place
its
case
during
re-assessment
proceedings and it is not the case that the
dismissal of the Writ Petition will result
any miscarriage of justice being caused to
the petitioner.

13. The learned Counsel for the
petitioner has next contended that during the
assessment proceedings, the petitioner had
provided the copy of the ledger account of
refundable amount received / to be received
with a copy of debit note issued to the
Principal Companies and it had disclosed all
1378 INDIAN LAW REPORTS ALLAHABAD SERIES
the material facts and nothing was concealed.
This question has already been decided in the
judgment dated 18-04-2022 and this Court
refused to interfere with the notice under
Section 148 issued on the basis of the reason
recorded by the Assessing Officer that
although the petitioner had produced the
books of account, annual report, Profit and
Loss Account and balance sheet, but the
requisite material facts were embedded in
such a manner that the material facts could
not be discovered by the A.O. This material
which came to light upon investigation
conducted subsequent to passing of the
assessment order, would certainly amount to
a fresh tangible material giving rise to reason
to believe that certain income has escaped
assessment necessitating initiation of reassessment proceedings. This finding does
not suffer from any error which may be said
to be apparent on the face of the record so as
to warrant a review of the judgment.

14. The learned Counsel for the
petitioner has next contended that the
judgment in the case of Raymond Woolen
Mills Ltd. (supra) is case specific and it
cannot be applied to the case of the petitioner.
The ratio of the judgments passed by the
Hon'ble Supreme Court in the cases of
Raymond Woolen Mills Ltd. (1) and (2)
(supra), is that at the stage of issuing a notice
for reassessment, the court has only to see
whether there is prima facie some material on
the basis of which, the department could reopen the case; the sufficiency or correctness
of the material is not a thing to be considered
at this stage, and this ratio does not appear to
be based on any peculiar facts so as to be not
applicable to the present case and the learned
counsel for the petitioner could not point out
as to how the aforesaid ratio is based on any
peculiar facts and it would not apply to the
present case. Therefore, we are unable to
accept the submission of the learned Counsel
for the petitioner that the judgment in the case
of Raymond Woolen Mills Ltd. (supra) is
case specific and it cannot be applied to the
case of the petitioner.

15. The learned counsel for the
petitioner also submitted that the judgment in
Phool Chand Bajrang Lal (supra) supports
the petitioner's contention that to initiate
reassessment proceedings, the Assessing
Officer must have some tangible material
before him before proceeding to initiate the
reimbursement under Section 147 of the Act.

16. The learned Counsel for the
petitioner has also contended that the order
passed by the Hon'ble Supreme Court in
Srikrishna (Pvt.) Ltd. versus I.T.O., (1996)
9 SCC 534 relied upon by this Court required
that the assessee is under obligation to
disclose the material facts and such disclosure
should be full and true and the petitioner has
made true and full disclosure of all material
facts.

17. So far as the submission that the
judgment in Phool Chand Bajrang Lal
(supra) supports the petitioner's contention
that to initiate reassessment proceedings, the
Assessing Officer must have some tangible
material before him before proceeding to
initiate the reimbursement under Section 147
of the Act, we may state that in Phool Chand
Bajrang Lal (supra), the Hon'ble Supreme
Court had held that the reassessment
proceedings may be started either because of
some fresh fact come into light which were
not previously disclosed or some information
with regard to the fact previously disclosed
comes into light which intends to expose
untruthfulness of those facts.

18. In the present case, the reassessment
has been ordered because the A.O. has
recorded his reasons to believe that the
5 All. Ram Samujh & Anr. Vs. State of U.P.
1379
petitioner had received payments under
Section 194 J also, but it had not shown the
said receipts in his Profit and Loss account
and had not given any explanation for the
same. The petitioner had not disclosed the
amount of reimbursement of expenses
claimed by it and the actual amount received
by it towards reimbursement. It had not
submitted the details of expenses incurred by
it for verification during the assessment
proceedings. It did not produce any ledger,
bills and vouchers of expenses incurred on
behalf of the Principal Companies. Thus the
petitioner did not make a "full and true"
disclosure of all the material facts which
resulted in an income of Rs. 1,07,24,386/-
having escaped assessment. In the instant
case, the notice under Section 148 of the Act
has been issued by the Assessing Officer after
an investigation was carried out and after
going through the income tax return and other
related documents of the petitioner and after
forming reason to believe that the petitioner
did not truly and fully disclose all the
material facts, because of which income
amounting to Rs.1,07,24,386/- has escaped
assessment. Thus the reassessment has been
ordered upon discovery of apprehended
untruthfulness of facts previously disclosed,
which came to light after an investigation
and, therefore, the judgment in Phool Chand
Bajrang Lal (supra) does not support the
petitioner and as per the law laid down in
Srikrishna
(Supra),
the
reassessment
proceedings have rightly been initiated.

19. The judgment passed by this Court
has also been sought to be reviewed on the
ground that various case laws relied upon by
the petitioner in support of its claim have not
been considered by this Court. In the
judgment sought to be reviewed, the
judgments of Aventis Pharma Ltd. versus
ACIT, (2010) 323 ITR 570 (Bom), Arun
Gupta versus Union of India, (2015) 371
ITR 394 (All) and United Electrical Co.
Ltd. versus Commissioner of Income Tax,
(2002) 258 I.T.R. 317, cited by the learned
counsel for the petitioner have been referred
to and dealt with. This Court is not obliged
to refer to each and every judgment forming
part
of
a
compilation
of
judgments
submitted
after
conclusion
of
oral
submissions, which judgments were not
placed before the Court during oral
submissions. Moreover, while deciding the
writ petition, we have referred to and relied
upon the relevant case laws and it is not
been submitted by the petitioner that in the
judgment sought to be reviewed, the law
applicable to the facts of the case has not
been taken into consideration. Therefore,
this submission also stands rejected.

20. In view of the aforesaid discussion,
we do not find any "error apparent on the
face of the record" in the judgment and the
order dated 18-04-2022 sought to be
reviewed. The application for review of the
judgment and order dated 18-04-2022 lacks
merit and, is accordingly dismissed.

21. However, there will be no order as
to costs.
----------
(2022)05ILR A1379
APPELLATE JURISDICTION
CRIMINAL SIDE
DATED: ALLAHABAD 13.04.2022

BEFORE

THE HON'BLE MANOJ MISRA, J.
THE HON'BLE SAMEER JAIN, J.

Criminal Appeal No. 2411 of 1983

Ram Samujh & Anr. ...Appellants (In Jail)
Versus
State of U.P. ...Respondent

Counsel for the Appellants: