M/s Concept Creations, Panipat v. Addl. CIT, Panipat

ITA 3370/DEL/2008 | 2005-2006
Pronouncement Date: 25-02-2010 | Result: Dismissed

Appeal Details

RSA Number 337020114 RSA 2008
Assessee PAN AAAFC6948H
Bench Delhi
Appeal Number ITA 3370/DEL/2008
Duration Of Justice 1 year(s) 3 month(s) 13 day(s)
Appellant M/s Concept Creations, Panipat
Respondent Addl. CIT, Panipat
Appeal Type Income Tax Appeal
Pronouncement Date 25-02-2010
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 25-02-2010
Date Of Final Hearing 27-01-2010
Next Hearing Date 27-01-2010
Assessment Year 2005-2006
Appeal Filed On 11-11-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B NEW DELHI (SPECIAL BENCH ) BEFORE SHRI G.E. VEERABHADRAPPA : VICE PRESIDENT; A ND SRHI C.L. SETHI : JUDICIAL MEMBER; AND SHRI K.D. RANJAN : ACCOUNTANT MEMBER ITA NO. 3370/DEL/08 ASSTT. YR: 2005-06 M/S CONCEPT CREATIONS VS. ADDL. CIT VPO NOORWALA PANIPAT. RANGE PANIPAT. PAN/GIR NO. AAAFC6948H ( APPELLANT ) ( RESPONDENT ) APPELLANT BY : 1. DR. RAKESH GUPTA ADVOCATE DELHI INTERVENERS : 2. SHRI VED JAIN CA DELHI 3. SHRI ANOOP SHARMA ADV. DELHI 4. SHRI SALIL KAPOOR ADV. DELHI 5. SHRI Y.K. KAPOOR THROUGH DELHI COUNSEL SH. KANAN KAPOOR ADV. 6. SHRI K.C. SINGHAL ADV. DELHI 7. DR. M.V.R. PRASAD ADV. HYDERABAD 8. SHRI T.N. CHOPRA ADV. DELHI 9. SHRI PRAKASH NARAIN ADV. DELHI 10.SHRI S.C. TIWARI ADV. MUMBAI 11.SHRI KESHAV PRASAD ADV LUCKNOW FOR MIN. OF LAW : SHRI A.K. BHARDWAJ SR. CENT RAL GOVT. COUNSEL. RESPONDENT BY : SHRI STEPHEN GEORGE CIT DR O R D E R PER G.E. VEERABHADRAPPA V.P: 1. WHEN THE ABOVE CAPTIONED APPEAL WAS POSTED FOR H EARING BEFORE THE DIVISION BENCH IT WAS NOTICED BY THE BENCH THAT I N VIEW OF INSERTION OF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 2 RULE 13E IN THE I.T.A.T. (RECRUITMENT AND CONDITIO NS OF SERVICE) RULES 1963 VIDE NOTIFICATION NO. GSR 389E DATED 3-6-2009 QUESTIONS WERE RAISED AS TO VALIDITY TO THE APPEARANCE OF DR. RAKE SH GUPTA ADVOCATE ON BEHALF OF THE ASSESSEE. THE BENCH AFTER HEARING D R. RAKESH GUPTA ADV. AND SOME EX-MEMBERS OF THE INCOME TAX APPELLATE TR IBUNAL (ITAT IN SHORT) WHO WERE PRESENT IN THE COURT FELT THAT TH E ISSUE WAS COMPLEX AND WOULD THEREFORE REQUIRE TO BE FIRST DECIDED BEFO RE DECIDING THE MERITS OF APPEAL. IT WAS ARGUED BEFORE THE DIVISION BENCH TH AT IT WAS INHERENT DUTY OF THE ITAT IN THE LIGHT OF THE PROVISIONS OF SEC. 254 OF THE INCOME-TAX ACT 1961 FIRST TO DISPOSE OFF THE PRELIMINARY ISSUE S SUCH AS THIS BEFORE DISPOSING OFF THE APPEAL ON MERITS. THE DIVISION BE NCH ALSO FELT THAT IN THE INTEREST OF JUSTICE IT IS NECESSARY THAT THIS MAT TER RECEIVES UNIFORM TREATMENT SO THAT ONE MAY AVOID UNNECESSARY AND AVOIDABLE MU LTIPLE LITIGATIONS. PRIMA FACIE THE DIVISION BENCH WAS OF THE OPINION THAT THE ISSUE REQUIRED REFERENCE TO SPECIAL BENCH AND THEREFORE DREW A R EFERENCE TO THE PRESIDENT ITAT (PRESIDENT IN SHORT) ON 10 TH JULY 2009. THE DIVISION BENCH ALSO SUGGESTED THE PRESIDENT TO EXPLORE THE POSSIBILITY OF THE MINISTRY OF LAW AND JUSTICE BEING GIVEN A NOTICE OF HEARING SO THAT THEY MAY MAKE A REPRESENTATION AS REGARDS THE EXACT OBJECTIV ES AND IMPLICATIONS OF THE SAID RULE 13E AND ALSO TO REPRESENT THE GOVERNMENT IN SUPPORT OF THE SAID ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 3 NOTIFICATION. IT APPRECIATED THE FACT THAT THE DEPA RTMENTAL REPRESENTATIVES MAY NOT POSSIBLY ARGUE IN THE MANNER EXPECTED OF T HEM WHILE THEY MAY NOT HAVE ANY INTEREST AS TO WHO ARGUES AND WHO DOES NOT ARGUE AND SOMETIMES THEY ALSO ENGAGE SERVICES OF EX-MEMBERS OF ITAT TO ARGUE THEIR CASES. 2. WHEN THE REFERENCE WAS PLACED BEFORE THE PRESIDE NT HE WAS OF THE OPINION THAT THE QUESTIONS RAISED WERE OF GREAT PUBLIC IMPORTANCE AND ALSO FELT THAT IN LARGE NUMBER OF CASES EX-MEMBERS DO APPEAR BEFORE DIFFERENT BENCHES IN THE COUNTRY BOTH FOR THE REVENUE AS WE LL AS FOR THE ASSESSEE. ACCORDING TO THE PRESIDENT ENGAGEMENT OF A COUNSE L OF ITS OWN CHOICE IS PART OF EFFECTIVE HEARING BEFORE THE TRIBUNAL. THE PRESIDENT ACCEPTED THE RECOMMENDATIONS OF THE DIVISION BENCH TO CONSTITUT E A SPECIAL BENCH. IT WAS ALSO DIRECTED THAT THE SPECIAL BENCH TO DECIDE WHETHER NOTICE OF HEARING HAS TO BE SENT TO THE GOVERNMENT OF INDIA THROUGH T HE MINISTRY OF LAW & JUSTICE. THAT IS HOW THE SPECIAL BENCH WAS CONSTIT UTED. THE SPECIAL BENCH IT MAY BE STATED WAS CONSTITUTED TO ANSWER THE FOL LOWING QUESTIONS: 1. WHETHER THE SAID NOTIFICATION APPLIES TO THE M EMBERS WHO HAVE RETIRED PRIOR TO THE DATE OF PUBLICATION OF TH E NOTIFICATION? 2. WHETHER THE SAID NOTIFICATION APPLIES ONLY TO T HE MEMBERS WHO RETIRED FROM THE TRIBUNAL ON AND FROM THE DATE OF PUBLICATION OF THIS NOTIFICATION? 3. WHETHER THE SAID NOTIFICATION APPLIES TO THOS E MEMBERS WHO ARE RECRUITED BEFORE BUT RETIRE AFTER THE DATE OF NOTIFICATION? ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 4 4. WHETHER THE SAID NOTIFICATION APPLIES TO THE ME MBERS WHO RETIRE IF OTHERWISE ARE QUALIFIED TO PRACTICE U/S 288 OF THE INCOME TAX ACT SHOULD STILL BE DEBARRED TO APPEAR AND ARG UE BEFORE THE TRIBUNAL? 5. WHETHER THE SAID NOTIFICATION APPLIES TO THE ME MBERS WHO RESIGNED FROM SERVICES BEFORE THE DATE OF NOTIFICAT ION WITHOUT ANY RETIREMENT BENEFITS? 3. IN PURSUANCE OF THE DIRECTIONS OF THE SPECIAL BE NCH A NOTICE WAS ISSUED TO THE MINISTRY OF LAW & JUSTICE. THE CASE W AS FIXED FOR HEARING ON 3 RD AUGUST 2009. IN PURSUANCE OF THE NOTICE GIVEN SE VERAL EX-MEMBERS OF THE ITAT WHO ARE PRACTICING IN DELHI AND OUTSIDE D ELHI SENT THEIR APPLICATIONS REFERRING TO THEIR CASES BEFORE ITAT AND PLEADED TO ACT AS INTERVENERS IN THIS CASE. HAVING REGARD TO THE ISSU E IN QUESTION THE BENCH PERMITTED ALL SUCH PERSONS WHO HAVE THE CASES BEFO RE THE TRIBUNAL TO ACT AS INTERVENERS. THE DEPARTMENTAL REPRESENTATIVE WAS AL SO PRESENT AND ON BEHALF OF THE MINISTRY SR. CENTRAL GOVERNMENT COUNSEL SH RI A.K. BHARDWAJ PUT IN THE APPEARANCE. 4. AT THE OUT SET A PRELIMINARY OBJECTION WAS TAKE N BY THE SR. CENTRAL GOVT. COUNSEL THAT THIS TRIBUNAL HAS NO JURISDICTIO N TO GO INTO RULE 13E WHICH IS THE PART OF THE I.T.A.T. (RECRUITMENT AND CONDITIONS OF THE SERVICE) RULES 1963 AND PLEADED THAT NO FURTHER HEARING IS NECESSARY ON THIS ISSUE AND THAT THE ISSUES BE DIRECTED TO CENTRAL ADMINIST RATIVE TRIBUNAL (CAT IN ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 5 SHORT) WHO ACCORDING TO HIM IS THE PROPER FORUM FOR DISPOSING OFF SUCH MATTER. 5. THE ASSESSEES COUNSEL AS WELL AS THE INTERVENER S VEHEMENTLY ARGUED THAT ITAT IS THE ONLY PROPER FORUM TO ADJUDICATE PR ELIMINARY ISSUES SUCH AS CAPACITY OF THE PARTIES REPRESENTATIVE OR AS TO TH EIR QUALIFICATION OR DISQUALIFICATION TO APPEAR BEFORE THE TRIBUNAL. IT IS VERY FUNDAMENTAL ISSUE THAT REQUIRES ADJUDICATION BEFORE THE APPEAL IS TAK EN UP ON MERITS. IF ITAT WERE TO WRONGLY PERMIT A PERSON WHO IS NOT QUALIFI ED TO APPEAR IN A CASE OR A QUALIFIED PERSON IS DENIED HIS RIGHT OF OPPORT UNITY TO ARGUE THE MATTER A GRAVE INJUSTICE IS CAUSED AND THEREFORE IT IS ABSO LUTELY NECESSARY AS A PART OF ITS INCIDENTAL OR INHERENT POWER THAT ONLY ITAT SH OULD DISPOSE OFF SUCH ISSUE. FOR IT SPECIFIC RELIANCE WAS PLACED TO THE DECISION OF THE SUPREME COURT IN THE CASE OF ITO VS. M.K. MOHAMMED KUNHI ( 1969) 71 ITR 815 (SC). ON THAT DATE WE PROCEEDED WITH THE MATTER BY KEEPING THE SAID ISSUE OPEN BUT ISSUED DIRECTION TO THE SR. CENTRAL GOVER NMENT COUNSEL TO FILE A DETAILED AFFIDAVIT ON MERITS. ACCORDINGLY THE MATT ER WAS ADJOURNED TO 17 TH AUGUST 2009. THERE WERE ALSO REQUESTS FROM SOME IN TERVENERS TO ADJUDICATE UPON THE FOLLOWING QUESTION: WHETHER THE SAID NOTIFICATION APPLIES TO THE MEMBE RS WHO ARE APPOINTED ON TEMPORARY BASIS AND RESIGN FROM SERVICE WITHOUT BEING CONFIRMED DURING THE PROBATION PERIOD EITHER BEFORE OR AFTER THE DATE OF NOTIFICATION WITHOUT ANY RETIREMENT BENEFITS. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 6 6. HAVING REGARD TO THE SPECIFIC FACTS IN SOME OF T HE CASES OF THE INTERVENERS AND ALSO IT IS PART OF LARGE QUESTION NO. (5) ABOVE THE BENCH AFTER GOING THROUGH THEIR REQUEST FOUND IT REASONA BLE AND THE SR. CENTRAL GOVT. COUNSEL OR THE DEPARTMENT HAD NO OBJECTION FO R ADJUDICATION OF THE SAID QUESTION. WE ACCORDINGLY TAKE THAT QUESTION AS PART OF THE REFERENCE AND PROCEED TO ANSWER ALL THE (6) QUESTIONS. 7. SHRI A.K. BHARDWAJ SR. CENTRAL GOVT. COUNSEL U LTIMATELY FILED AN AFFIDAVIT ON BEHALF OF THE MINISTRY ON 24-8-2009 AN D THE PARTIES WERE SERVED WITH THAT AND THE MATTER WAS EXTENSIVELY HEARD ON 2 4 TH AND 25 TH AUGUST 2009. BEFORE GOING INTO THE QUESTIONS THEMSELVES AS WE D ISCUSSED EARLIER THE OBJECTION OF THE LAW MINISTRY REMAINS TO BE ADJUDIC ATED WHICH WE TAKE UP NOW. 8. IT WAS ARGUED ON BEHALF OF THE MINISTRY OF LAW & JUSTICE THAT THE ITAT IS CONSTITUTED ONLY FOR THE PURPOSE OF HEARING AND DISPOSING OFF THE APPEALS ARISING UNDER THE INCOME-TAX ACT. IT CANNOT GO INTO INTERPRETATION OF THE VALIDITY OR CORRECTNESS OR OTHERWISE OF RULE 1 3E WHICH IS THE PART OF THE ITAT MEMBERS (RECRUITMENT & CONDITIONS OF SERVICE) RULES 1963. THE PROPER FORUM ACCORDING TO HIM IS THE CENTRAL ADMI NISTRATIVE TRIBUNAL (CAT) AND THEREFORE IT WAS VEHEMENTLY OPPOSED T HE REFERENCE BY ARGUING THAT THIS TRIBUNAL HAS NO JURISDICTION TO ADJUDICAT E UPON THE ISSUES THAT ARE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 7 BEING RAISED BEFORE IT. THE SERVICE IN THE GOVERNME NT IS A CONTRACT BETWEEN THE EMPLOYEE AND THE GOVERNMENT OF INDIA. THE TRIBU NAL MEMBERS ARE PART OF THAT CLASS AND IF THEIR CONDITIONS OF SERVICE A RE AMENDED TO THEIR DETRIMENT IT IS FAIR AND PROPER THAT THEY SHOULD B E DIRECTED TO GO BEFORE THE CAT AND NOT ARGUE THEIR ENTITLEMENT BEFORE THE ITAT . 9. ON THE OTHER HAND THE LEARNED COUNSEL FOR THE A SSESSEE AS WELL AS THE INTERVENERS APPEARING VEHEMENTLY ARGUED THAT THI S TRIBUNAL IS THE ONLY FORUM WHERE THE ISSUE OF THIS NATURE REQUIRES TO BE ADJUDICATED. THE ITAT JAIPUR BENCH IN THE CASE OF SAGARMAL SARAWGI VS. IT O VIDE ITS ORDER DATED 10 TH AUGUST 1976 IN ITA NO. 473/JP/1973-74 (1976) 2 TTJ (JP) 1371 WENT INTO SUCH QUESTIONS WHEN SIMILAR ISSUES WERE RAISE D. SIMILARLY ITAT MUMBAI BENCH A IN THE CASE OF TATA CHEMICALS LTD . VS. DCIT VIDE THEIR ORDER DATED 5-12-1997 ITA NO. 4604/MUM/(1996) 67 I TD 56 WENT INTO THE QUESTION WHETHER PARTICULAR DR WAS VALIDLY APPOINT ED BY THE DEPARTMENT AND WHETHER HE COULD ARGUE THE CASE BEFORE THE ITAT . THE TRIBUNAL DISPOSED OFF AND ADJUDICATED THE SAME MEANING THEREBY THE T RIBUNAL IS THE ONLY FORUM WHERE SUCH ISSUES REQUIRE TO BE THRASHED OU T. IT WAS POINTED OUT BY THEM THAT THEY HAVING ALREADY RETIRED FROM GOVERNME NT SERVICE CANNOT APPROACH THE CAT. THEY PLEADED THAT SINCE RIGHT TO APPEAR BEFORE THE ITAT IS BEING QUESTIONED ONLY THE ITAT HAS TO DEAL AND DISPOSE THEM. OUR ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 8 ATTENTION WAS DRAWN TO THE DECISION OF THE SUPREME COURT IN THE CASE OF ITO VS. M.K. MOHAMMED KUNHI (SUPRA). 10. WE HAVE CONSIDERED THE RIVAL CONTENTIONS ON TH IS PRELIMINARY ISSUE IN THE LIGHT OF RATIO LAID DOWN BY THE CASES TO WHICH RELIANCE IS PLACED. FOR THIS IT IS NECESSARY TO GO INTO OURSELVES. SECTION 254(1 ) OF THE INCOME-TAX ACT 1961 READS AS UNDER: 254(1) THE APPELLATE TRIBUNAL MAY AFTER GIVING BOTH THE PARTIES TO THE APPEAL AN OPPORTUNITY OF BEING HEARD PASS SUCH ORDERS THEREON AS IT THINKS FIT. 11. THE TRIBUNAL UNDER THE AFORESAID SECTION IS REQ UIRED TO HEAR BOTH THE PARTIES TO THE APPEAL BEFORE PASSING ANY ORDER. U/S 254(1) OF THE INCOME-TAX ACT 1961 THE ITAT IS REQUIRED TO GIVE BOTH THE PA RTIES TO THE APPEAL AN OPPORTUNITY OF BEING HEARD. THE EXPRESSION OPPORTU NITY OF BEING HEARD IS NOT AN EMPTY FORMALITY BUT A VALUABLE RIGHT MADE A VAILABLE TO THE PARTIES IN APPEAL BEFORE THE TRIBUNAL. EVEN THOUGH SUCH RIGHT PERSONIFIES THE PRINCIPLE OF NATURAL JUSTICE IT CAN ACCURATELY BE DESCRIBED AS A STATUTORY RIGHT IN THE CONTEXT OF THE EXPLICIT PROVISIONS OF SECTION 254(1 ). SUCH A RIGHT CANNOT BE ALLOWED TO BE DEFEATED BY PROCEDURAL WRANGLES OR WH IMS AND FANCIES OF THE AUTHORITY CONCERNED. IT WAS EXPLAINED BY THE KERALA HIGH COURT IN THE CASE OF SISCO V. STATE OF KERALA (1995) 96 STC 438 THAT AN OPPORTUNITY OF BEING HEARD CONTEMPLATED IN SECTION 254(1) SHALL BE EFFEC TIVE AND ADEQUATE AND IT ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 9 CANNOT BE MADE ILLUSORY UNDER ANY CIRCUMSTANCE. MER E ISSUE OF A NOTICE OF HEARING OF THE APPEAL WILL NOT SUFFICE IN ALL CIRCU MSTANCES. IN FACT THE POWER TO GRANT ADJOURNMENT ALSO ARISES FROM THE PROVISION S OF SEC. 254(1) OF THE ACT. A WRONG EXERCISE OF A DISCRETION TO ADJOURN IT SELF CAN GIVE RISE TO QUESTIONS OF LAW BEFORE THE HIGH COURT AND THE DECI SION RENDERED BY THE ITAT WITHOUT GIVING AN OPPORTUNITY OF BEING HEARD I TSELF CAN BE QUESTIONED. THE POWERS OF THE ITAT U/S 254 OF THE ACT IN DEALIN G WITH THE APPEAL ARE EXPRESSED IN THE WIDEST POSSIBLE TERMS AND ARE SIMI LAR TO THE POWER OF AN APPELLATE COURT UNDER THE CIVIL PROCEDURE CODE. IT WAS SO HELD BY THE BOMBAY HIGH COURT IN NEW INDIA ASSURANCE CO. LTD. VS. CIT (1957) 31 ITR 844. THE SUPREME COURT IN THE CASE OF ESTHURI A SWATHIAH VS. CIT (1967) 66 ITR 478 (SC) HAS HELD THAT FUNCTION OF T HE APPELLATE TRIBUNAL IN HEARING AN APPEAL IS PURELY JUDICIAL. IT IS UNDER A DUTY TO DECIDE ALL QUESTIONS OF FACT AND LAW RAISED IN THE APPEAL BEFORE IT. BUT THE TRIBUNAL CANNOT MAKE ARBITRARY DECISIONS. IT CANNOT FOUND ITS JUDGMENT O N CONJECTURES SURMISES OR SPECULATION. IN THE EXERCISE OF ITS POWERS THE TRI BUNAL IS VESTED WITH A LARGE AREA OF DISCRETION IN A NUMBER OF MATTERS SUCH AS C ONDONING THE DELAY IN FILING OF THE APPEAL ADMISSION OF NEW PLEAS AND AD DITIONAL EVIDENCE CONDUCT OF FURTHER ENQUIRY ON ITS OWN OR BY REMAND TO THE LOWER AUTHORITIES PASSING SUCH ORDERS ON THE APPEAL AS THE INTERESTS OF JUSTI CE MAY REQUIRE AND SO ON. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 10 THE DISCRETION THUS CONFERRED IS AN IMPARTIAL LEGAL DISCRETION TO BE EXERCISED IN CONFORMITY WITH THE SPIRIT OF THE LAW AND IN SUC H A MANNER AS TO SUBSERVE AND NOT DEFEAT THE INTERESTS OF JUSTICE OR FURTHER ANCE OF ITS CAUSE. IT SHOULD BE GUIDED BY LAW AND SHOULD NOT BE ARBITRARY CAPRICIO US VAGUE FANCIFUL OR GOVERNED BY HUMOUR UNTHINKING FOLLY OR RASH INJUST ICE. 12. SECTION 254 PROVIDES THAT SAVE AS PROVIDED IN SECTION 256 OR SECTION 260A ORDERS PASSED BY THE APPELLATE TRIBUNAL ON AP PEAL SHALL BE FINAL. U/S 256 THE HIGH COURT HAS ONLY REFERENCE JURISDICTIO N ON QUESTIONS OF LAW FRAMED BY IT. NOW AFTER THE AMENDMENT W.E.F. 1-10- 1998 AN APPEAL SHALL LIE TO THE HIGH COURT FROM EVERY ORDER PASSED BY THE TR IBUNAL IF THE HIGH COURT IS SATISFIED THAT THE CASE INVOLVES A SUBSTANTIAL Q UESTION OF LAW. ALL THESE PROVISIONS POINT OUT TO ONE THING THAT THE ORDER OF THE TRIBUNAL ON FACTUAL ASPECTS IS FINAL AND UNQUESTIONABLE BUT ON POINTS O F LAW AN APPEAL COULD STILL LIE BEFORE THE HIGH COURT IF THE SAME IS SUBSTANTI AL IN NATURE. REFERENCE MAY BE MADE TO THE RATIO OF DECISIONS IN THE CASE OF I. C.I. (INDIA) PVT. LTD. VS. CIT (1972) 83 ITR 710 (SC); AND CIT VS. MEHMOODMIAN A. TOPIWALA 213 ITR 615 (GUJ.). THE ORDER OF THE TRIBUNAL ALTHOUGH FACTUAL MAY BE CONSTRUED AS ONE GIVING RISE TO A SUBSTANTIAL QUEST ION OF LAW IF SUCH ORDER IS BASED ON NO EVIDENCE IN SUPPORT THEREOF OR THERE I S CONTRAVENTION OF PRINCIPLES OF NATURAL JUSTICE IN THAT EVENT THE OR DER ITSELF WILL BE TREATED AS ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 11 PERVERSE AND IS LIKELY TO BE SET AT NAUGHT AND THE RE CAN BE NO EFFECTIVE DISPOSAL OF APPEAL UNLESS THE ORDER OF THE TRIBUNA L IS PASSED ONLY AFTER HEARING THE PROPER PARTIES DULY QUALIFIED TO APPEA R EITHER FOR THE ASSESSEE OR FOR REVENUE. REFERENCE MAY BE MADE TO THE DECISION OF THE APEX COURT IN THE CASE OF CHABILDAS TRIBHUVAN DAS VS. CIT (1966) 59 I TR 733 (SC).WHERE THERE IS DENIAL OF PRINCIPLES OF NATURAL JUSTICE IN A GIVEN CASE IT WILL GIVE RISE TO A LEGAL QUESTION AS POINTED OUT BY THE MADHYA P REDESH HIGH COURT IN THE CASE OF CIT VS. ABHYESHWAR (1999) 153 CTR MP 372. F AILURE TO GIVE PROPER AND EFFECTIVE HEARING AMOUNTS TO DENIAL OF O PPORTUNITY OF BEING HERD AND IS LIKELY TO BE CONSTRUED AS ONE BEING PERVERSE AND ALL SUCH ORDERS ARE LIABLE TO BE DISTURBED. ONLY ON THIS PRELIMINARY G ROUND IF THE ORDER COULD BE DISTURBED THERE CAN BE NO EFFECTIVE DISPOSAL OF A PPEAL. THEREFORE THIS ISSUE REQUIRES TO BE PROPERLY ADDRESSED AND SORTED OUT I N ACCORDANCE WITH WELL LAID DOWN PRINCIPLES OF LAW AND ALSO THE PRINCIPLES OF NATURAL JUSTICE. 13. NOW WE WILL SEE THE FACTS IN THE CASE OF ITO V S. M.K. MOHAMMED KUNHI (SUPRA) THE ASSESSEE WAS IMPOSED WITH PENAL TY U/S 271(1)(C) OF THE I.T. ACT FOR CONCEALMENT OF PARTICULARS OF INCOME. THE ASSESSEE QUESTIONED THOSE PENALTIES BEFORE THE ITAT AND ALSO MADE AN IN TERIM PRAYER FOR STAY OF COLLECTION OF THE PENALTIES IMPOSED. THE TRIBUNAL D ECLINED TO ORDER ANY STAY HOLDING THAT IT HAD NO POWER TO GRANT SUCH A PRAYER . IN FACT THERE WERE NO ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 12 PROVISIONS AS THE ONE WE HAVE NOW AT THAT POINT OF TIME WHEN THE PRAYER FOR STAY WAS MADE. THE ASSESSEE THEN MOVED THE KERALA H IGH COURT UNDER ARTICLE 226 OF THE CONSTITUTION. THE KERALA HIGH COURT IN T HE CASE OF M.K. MOHAMMED KUNHI VS. ITO (1966) 59 ITR 171 HELD THAT THE TRIBUNAL HAD THE POWER TO STAY THE PROCEEDINGS AS ALSO THE COLLECTI ON OF THE PENALTIES PENDING THE APPEAL SINCE THAT POWER WAS INCIDENTAL AND ANCI LLARY TO ITS APPELLATE JURISDICTION. THE TRIBUNAL WAS CONSEQUENTLY DIRECTE D TO DISPOSE OF THE STAY APPLICATION IN ACCORDANCE WITH LAW. THE REVENUE CH ALLENGED FURTHER. THEIR LORDSHIPS OF THE SUPREME COURT OBSERVED THAT THE RI GHT OF APPEAL IS A SUBSTANTIVE RIGHT AND THE QUESTIONS OF FACT AND LA W ARE AT LARGE AND ARE OPEN TO REVIEW BY THE APPELLATE TRIBUNAL. THE TRIBUNAL HAS BEEN GIVEN VERY WIDE POWERS UNDER SECTION 254(1) FOR IT MAY PASS SUCH O RDERS AS IT THINKS FIT AFTER GIVING FULL HEARING TO BOTH THE PARTIES TO THE APPE AL. IF THE ITO AND THE APPELLATE ASSISTANT COMMISSIONER HAVE MADE ASSESSME NTS OR IMPOSED PENALTIES RAISING VERY LARGE DEMANDS AND IF THE TRI BUNAL IS ENTIRELY HELPLESS IN THE MATTER OF STAY OF RECOVERY THE ENTIRE PURPO SE OF THE APPEAL GET DEFEATED IF ULTIMATELY THE ORDERS OF THE DEPARTMENT AL AUTHORITIES ARE SET ASIDE. IT IS DIFFICULT TO CONCEIVE THAT THE LEGISLATURE SH OULD HAVE LEFT THE ENTIRE MATER TO THE ADMINISTRATIVE AUTHORITIES TO MAKE SUCH ORDE RS AS THEY CHOOSE TO PASS IN EXERCISE OF UNFETTERED DISCRETION. THEREFORE TH E SUPREME COURT IN THIS ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 13 CONTEXT OBSERVED THAT POWERS WHICH HAVE BEEN CONFER RED BY SEC. 254 ON THE APPELLATE TRIBUNAL WHICH WERE OF WIDEST POSSIBLE A MPLITUDE MUST CARRY WITH THEM BY NECESSARY IMPLICATION ALL POWERS AND D UTIES INCIDENTAL AND NECESSARY TO MAKE THE EXERCISE OF THOSE POWERS FULL Y EFFECTIVE. THEY QUOTED FROM DOMATS CIVIL LAW (CUSHINGS EDITION) VOLUME 1 AT PAGE 88 THE FOLLOWING PASSAGE WHICH WAS AS UNDER: IT IS THE DUTY OF THE JUDGES TO APPLY THE LAWS NO T ONLY TO WHAT APPEARS TO BE REGULATED BY THEIR EXPRESS DISPOSITIO NS BUT TO ALL THE CASES WHERE A JUST APPLICATION OF THEM MAY BE MADE AND WHICH APPEAR TO BE COMPREHENDED EITHER WITHIN THE CONSEQU ENCES THAT MAY BE GATHERED FROM IT. 14. THEY ALSO QUOTED FROM MAXWELL ON INTERPRETATIO N OF STATUTES ELEVENTH EDITION AT PAGE 350 AND MADE THE FOLLOW ING EXTRACT: WHERE AN ACT CONFERS A JURISDICTION IT IMPLIEDLY ALSO GRANTS THE POWER OF DOING ALL SUCH ACTS OR EMPLOYING SUCH MEA NS AS ARE ESSENTIALLY NECESSARY TO ITS EXECUTION. CUI JURISDICTIO DATA EST EA QUOQUE CONCESSA ESSE VIDENTUR SINE QUIBUS JURISDIC TIO EXPLICARI NON POTUIT . AN INSTANCE IS GIVEN BASED ON EX PARTE MARTIN TH AT WHERE AN INFERIOR COURT IS EMPOWERED TO GRANT AN I NJUNCTION THE POWER OF PUNISHING DISOBEDIENCE TO IT BY COMMITMENT IS IMPLIEDLY CONVEYED BY THE ENACTMENT FOR THE POWER WOULD BE U NLESS IF IT COULD NOT BE ENFORCED. 15. IT IS QUITE INTERESTING TO NOTE THAT THEIR LOR DSHIPS FURTHER PROCEEDED AND MADE THE FOLLOWING OBSERVATION: IT WAS SAID THAT THE GENERAL PRINCIPLE WAS THAT IN A TAXING STATUTE THE WAS NO ROOM FOR WHAT COULD BE CALLED THE EQUITA BLE CONSTRUCTION BUT THAT PRINCIPLE APPLIED ONLY TO TH E TAXING PART OF THE STATUTE AND NOT TO THE PROCEDURAL PART. IT HAS FURTHER BEEN ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 14 OBSERVED THAT WHERE THE LEGISLATURE INVESTS AN APPELLATE TRIBUNAL WITH POWERS TO PREVENT AN INJUSTICE IT IMPLIEDLY E MPOWERS IT TO STAY THE PROCEEDINGS WHICH MAY RESULT IN CAUSING FU RTHER MISCHIEF. IT IS WELL KNOWN THAT THE INCOME-TAX APPELLATE TRIB UNAL IS NOT A COURT BUT IT EXERCISES JUDICIAL POWERS. THE TRIBUNA LS POWERS IN DEALING WITH APPEALS ARE OF THE WIDEST AMPLITUDE AN D HAVE IN SOME CASES BEEN HELD SIMILAR TO AND IDENTICAL WITH THE P OWERS OF AN APPELLATE COURT UNDER THE CIVIL PROCEDURE CODE: SEE COMMISSIONER OF INCOME-TAX V. HAZARIMAL NAGJI AND CO. AND NEW IN DIA ASSURANCE CO. LTD. V. COMMISSIONER OF INCOME-TAX/ E XCESS PROFITS TAX. 16. THE SUPREME COURT UPHELD THAT THE ITAT HAS A POWER TO GRANT THE STAY ALTHOUGH THERE WERE NO EXPRESS PROVISIONS IN T HE ACT AS A PART OF THE INCIDENTAL OR ANCILLARY TO ITS APPELLATE JURISDICTI ON. IT WAS OBSERVED BY THE SUPREME COURT THAT WHEN SEC. 254 CONFERS APPELLATE JURISDICTION ON ITAT IT IMPLIEDLY GRANTS THE POWER OF DOING ALL SUCH ACT S OR EMPLOYING SUCH MEANS AS ARE ESSENTIALLY NECESSARY TO ITS EXECUTIO N AND THAT THE STATUTORY POWER CARRIES WITH IT THE DUTY IN PROPER CASES TO M AKE SUCH ORDERS FOR STAYING PROCEEDINGS AS WELL TO PREVENT THE APPEAL IF SUCCES SFUL FROM BEING RENDERED NUGATORY. 17. IN THE LIGHT OF THE AFORESAID PRINCIPLES LAID D OWN BY THE SUPREME COURT WE WILL EXAMINE THE PROVISIONS OF SEC. 254(1 ) WHICH MANDATES THE TRIBUNAL TO GIVE TO BOTH THE PARTIES TO APPEAL AN OPPORTUNITY OF BEING HEARD IN THE MATTER. IF ONE OF THEM IS DENIED OR A PROPE R PERSON IS NOT ALLOWED THE JUDICIAL PROCESS ITSELF GET DERAILED AND THE ORDER OF THE TRIBUNAL HOW SO EVER ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 15 STRONG IT IS IS LIABLE TO BE SET ASIDE ON THE GRO UND THAT PROPER OPPORTUNITY OF BEING HEARD IS NOT GRANTED TO A PROPER PERSON OR A N IMPROPER PERSON IS ALLOWED TO ARGUE THE MATER. SO THEREFORE IN OUR C ONSIDERED OPINION IN THE LIGHT OF THE PRINCIPLE LAID DOWN BY THE SUPREME COU RT IN THE CASE OF M.K. MOHAMMED KUNHI (SUPRA) THE TRIBUNAL HAS INHERENT J URISDICTION TO GO INTO THE QUESTION WHETHER THE PARTIES WHO ARE APPEARING BEFORE IT ARE PROPERLY ENTITLED UNDER THE LAW TO MAKE APPEARANCE. FOR THIS PURPOSE THEY ARE ENTITLED TO GO INTO PROVISIONS OF ADVOCATES ACT BAR COUNCIL ACT CHARTERED ACCOUNTANTS ACT OR THE SERVICE REGULATIONS OR PENS ION RULES OR INTO PROVISIONS OF I.T. ACT. THEY MAY ALSO INTERPRET L AWS OF CONTRACT AGENCY COMPANY LAW PARTNERSHIP LAW ALLIED LAWS BRANCHE S OF INTERNATIONAL LAW OR ANY OTHER ALLIED LAWS ETC. FOR THE PURPOSE. THE AREAS WHERE WE ARE REQUIRED TO LOOK INTO FOR THIS PURPOSE MAY THUS GET EXTENDED DEPENDING UPON THE FACTS AND CIRCUMSTANCES OF EACH CASE. AFTER ALL IT MUST BE APPRECIATED THE RIGHT OF APPEAL PROVIDED UNDER THE INCOME-TAX A CT TO THE PARTIES IS NOT AN EMPTY FORMALITY BUT A PART OF JUDICIAL PROCESS MAN DATED BY THE LAW. BE IT REVENUE OR THE ASSESSEE HAS SUBSTANTIVE RIGHT A ND THE TRIBUNAL CANNOT RUN AWAY FROM ITS BASIC DUTY TO ADJUDICATE THIS PRELIMI NARY ISSUE WHEN IT RAISED OR ARISES BEFORE IT AS A PART OF SUCH A JUDICIAL PR OCESS. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 16 18. ALTHOUGH IT IS NOT OF MUCH IMPORTANCE RULES 16 AND 17 OF THE APPELLATE TRIBUNAL RULES 1963 ALSO PROVIDE FOR F ILING OF PROPER AUTHORIZATION FOR APPEARING BEFORE THE ITAT. IT MAY BE QUITE POSSIBLE THE REGISTRY OFFICIALS MAY RAISE OBJECTION AND DO NOT ACCEPT THE POWER OF ATTORNEY OF A PERSON FILED BY THE PARTIES WHEN A R ULE LIKE RULE 13E IS RAISED ON A PERSON WHO CLAIMS AN OPPORTUNITY OF BEING HEAR D IN THE MATTER. THEREFORE IT IS ALL THE MORE NECESSARY THAT THE TR IBUNAL HAS TO GO INTO THIS QUESTION AND DISPOSE OFF THE PRELIMINARY OBJECTION IN THIS REGARD. IT MAY BE MENTIONED THAT JAIPUR AND BOMBAY BENCHES OF THE TR IBUNAL IN THE CASES CITED EARLIER HAVE EXACTLY DONE THE SAME THING W HEN DISPUTES WERE RAISED AS TO THE COMPETENCE OF A PERSON CLAIMING TO REPRES ENT BEFORE ITAT. IN BOTH THESE CASES THE COMPETENCE OF PERSON APPEARING AS A UTHORIZED REPRESENTATIVE WAS A DEPARTMENTAL REPRESENTATIVE PROTECTING TH E INTEREST OF THE REVENUE WAS IN QUESTION AND THE TRIBUNAL ADJUDICATED THESE ISSUES. THEREFORE WE ENTIRELY AGREE WITH THE VIEW TAKEN BY THE JAIPUR BE NCH AND THE MUMBAI BENCH IN THIS REGARD. 19. THE DELHI HIGH COURT IN THE CASE OF TAYLOR INST RUMENT CO. (INDIA) LTD. VS. CIT (1998) 232 ITR 771 (DEL.) HAS HELD THA T THE TRIBUNAL CANNOT DETERMINE WHETHER OR NOT A PROVISION VIOLATES ARTIC LES OF CONSTITUTION. THE TRIBUNAL BEING A CREATURE OF THE INCOME-TAX ACT CA N ONLY CONFINE ITSELF TO THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 17 PROVISIONS OF THE ACT AND CANNOT PRONOUNCE UPON TH E CONSTITUTIONAL VALIDITY OR VIRES OF ANY PROVISION OF THE ACT. 20. WE ARE AWARE OF THE LIMITATION. WITH THIS CAUTI ON WE REACH A CONCLUSION THAT THE TRIBUNAL IS COMPETENT TO GO INT O THE QUESTIONS AS RAISED IN THESE CASES AND WE PROCEED TO TAKE UP THE ISSUE THAT HAVE ARISEN AS A RESULT OF THE NOTIFICATION WHICH HAS A DIRECT BEAR ING ON THE PROCESS OF HEARING. 21. RULE 13E WHICH IS THE BONE OF CONTENTION IS I NSERTED BY THE NOTIFICATION G.S.R. 389(E) DATED 3-6-2009. THIS IS ISSUED BY THE MINISTRY OF LAW AND JUSTICE AND READS AS UNDER: 13E. THE PRESIDENT THE SENIOR VICE-PRESIDENT THE VICE- PRESIDENT AND THE MEMBER OF THE TRIBUNAL SHALL NOT PRACTICE BEFORE THE TRIBUNAL AFTER RETIREMENT FROM THE SERVI CE OF THE TRIBUNAL. BROADLY STATED THIS NOTIFICATION HAS THE EFFECT OF DENYING/ DISTURBING THE SPECIFIED PERSONS I.E. PRESIDENT SR. VICE PRESIDEN T VICE-PRESIDENT AND THE MEMBERS OF THE TRIBUNAL TO APPEAR AND ARGUE THE CA SES BEFORE THE ITAT ALTHOUGH THEY MAY HAVE NECESSARY QUALIFICATION UNDE R THE PROVISIONS OF SECTION 288 OF THE INCOME-TAX ACT 1961. UNLESS A P ERSON IS DULY QUALIFIED U/S 288 OF THE I.T. ACT AND DOES NOT SUFFER FROM AN Y OF THE DISQUALIFICATIONS STATED UNDER SUB-SECTIONS (4) (5) AND (7) OF SEC . 288 THE PERSON IS ENTITLED ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 18 TO APPEAR BEFORE THE TRIBUNAL ON BEHALF OF THE ASSE SSEE OR THE DEPARTMENT. THE PROVISION OF SECTION 288 IS AN ACT OF PARLIAMENT. T HE NOTIFICATION STATED ABOVE IS ISSUED BY THE PRESIDENT OF INDIA IN EXERC ISE OF THE POWERS CONFERRED BY THE PROVISO TO ARTICLE 309 OF THE CONSTITUTION OF INDIA. THE SAID NOTIFICATION HAS THE EFFECT OF AMENDING THE INCOME- AX APPELLATE TRIBUNAL MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE )R ULES 1963. 22. IT WAS THE COMMON ARGUMENT OF ALL THE PERSONS WHO APPEARED FOR THE ASSESSEE AS WELL AS THE INTERVENERS THAT THE DELHI HIGH IN WRIT PETITION NO. 6710/07 IN THE CASE OF P.C. JAIN WAS CONCERNED WITH SUB-SECTION (6) OF SECTION 129 OF THE CUSTOMS ACT 1962. THE SAID PROV ISION WAS INTRODUCED BY SECTION 110 OF THE FINANCE ACT 2007 W.E.F. 11-5-20 07. THE SAID SUB-SECTION READ AS UNDER: 129(6) ON CEASING TO HOLD OFFICE THE PRESIDENT VICE- PRESIDENT OR OTHER MEMBER SHALL NOT BE ENTITLED TO APPEAR ACT OR PLEAD BEFORE THE APPELLATE TRIBUNAL. 23. IT WAS POINTED OUT THAT DELHI HIGH COURT WAS NO T AT ALL CONCERNED WITH THE INTERPRETATION OF A PROVISION RELATING TO CONDI TIONS OF SERVICE. THEY WERE CONCERNED WITH THE PROVISIONS OF SEC. 129(6) WHICH WAS BROUGHT BY THE PARLIAMENT IN THE STATUTE RELATING TO CUSTOMS ACT. THIS IS THE DIFFERENCE ACCORDING TO THE INTERVENERS AND THE APPELLANTS AD VOCATE. THE MAJOR ISSUES THAT FALL FOR OUR CONSIDERATION COULD BE AS UNDER: ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 19 (I)WHETHER THERE IS ANY DIFFERENCE IN THE LEGISLAT IVE AMENDMENT IN SECTION 129(6) OF THE CUSTOMS ACT 1962 AND RULE 13-E OF THE INCOME TAX APPELLATE TRIBUNAL MEMBERS (RECRUIT MENT AND CONDITIONS OF SERVICE) RULES 1963. WHETHER THAT R EALLY MAKES ANY DIFFERENCE? (II) CLASSIFICATION OF THE MEMBERS WHETHER PROHIBI TED FROM APPEARING BEFORE THE ITAT. WHETHER THE SAID PROHIB ITION APPLIES TO THE EX-MEMBERS OR THE PRESENT MEMBERS OR ONLY THE MEMBERS WHO JOIN HEREAFTER. 24. AMONG THE EX-MEMBERS THERE IS AN IMPORTANT CLA SSIFICATION AS TO THE POSITION OF RESIGNED MEMBERS AND THE MEMBERS WHO SU PERANNUATED AFTER THEIR FULL LENGTH OF SERVICE. THE SPECIAL BENCH HAS ADDRESSED ITSELF ON ALL THE ABOVE QUESTIONS. WE TAKE UP THE CASE OF RESIGNED ME MBERS AND AFTER HEARING THEIR ARGUMENTS DISPOSE OF THEIR MATTERS. WE WILL T AKE UP THE CASES OF RETIRED MEMBERS SEPARATELY AND DISPOSE OFF THEIR ISSUES. AC CORDING TO US PERSONS MENTIONED AT (1) TO (5) FALL UNDER THIS CATEGORY OF RESIGNED MEMBERS (1) DR. RAKESH GUPTA ADVOCATE; (2) SHRI VED JAIN CA ; (3) SHRI ANOOP SHARMA ADV.; (4) SHRI SALIL KAPUR ADV.; AND (5) SHR I Y.K. KAPOOR ADV. THE CASE OF THE RESIGNED MEMBERS IS QUITE INTERESTING. WE WILL TAKE FACTS OF EACH OF THE RESIGNED MEMBERS FOR A BETTER APPRECIATION. 25. DR. RAKESH GUPTA ADVOCATE WAS APPOINTED AS AN ACCOUNTANT MEMBER IN THE ITAT VIDE HIS APPOINTMENT LETTER DATED 20 TH JULY 2000. HIS POST ITSELF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 20 WAS ADVERTISED TO BE TEMPORARY AND THE TERMS AND CO NDITIONS OF APPOINTMENT CONTAINED THE FOLLOWING: 1. THE SAID POST OF ACCOUNTANT MEMBER IN THE INCOM E TAX APPELLATE TRIBUNAL BELONGS TO GENERAL CENTRAL SERVICE (GROUP A) AND CARRIES A PAY SCALE OF RS. 22 400-600-26000/- P.M. IN ADDITION YOU WILL BE ENTITLED TO ALLOWANCE AT THE RATES ADMISSIB LE TO CENTRAL GOVT. OFFICERS OF YOUR CATEGORY UNDER AND SUBJECT TO THE CONDITIONS LAID DOWN IN RULES AND ORDERS GOVERNING THE GRANT OF SUCH ALLOWANCES IN FORCE FROM TIME TO TIME. 2. THE SAID POST IS PURELY TEMPORARY AND IS AT PRESENT SANCTIONED UPTO THE 28 TH FEBRUARY 2001 BUT LIKELY TO CONTINUE THEREAFTER . 3. THE APPOINTMENT CARRIES WITH IT THE LIABILITY TO SERVE IN ANY PART OF INDIA. 4. YOUR CONDITIONS OF SERVICE WILL BE GOVERNED BY THE INCOME TAX APPELLATE TRIBUNAL MEMBERS (RECRUITMENT AND CONDITI ONS OF SERVICE) RULES 1963 (COPY ENCLOSED). 5. IN YOUR TEMPORARY APPOINTMENT TO THE POST OF ACCOUNTANT MEMBER INCOME TAX TRIBUNAL YOU WILL REMAIN ON PROBATION FOR A PERIOD OF TWO YEARS BUT THE SAID PERIOD MAY BE EXTENDED AT THE DISCRETION OF THE APPOINTING AUTHORITY. THE APPOINTMENT MAY B E TERMINATED BY THE APPOINTING AUTHORITY AT ANYTIME W ITHOUT ASSIGNING ANY REASON. N CASE YOU WANT TO RESIGN THE APPOINTMENT YOU WILL BE REQUIRED TO GIVE ONE MONTHS NOTICE TO THE APPOINTING AUTHORITY. .. 11. OTHER CONDITIONS OF THE SERVICE WILL BE SAME AS ARE APPLICABLE TO CENTRAL GOVT. SERVANTS UNDER THE RELEVANT RULES AND ORDERS IN FORE FROM TIME TO TIME. 13. YOUR SAID APPOINTMENT TO THE POST OF MEMBER IN THE ITAT WILL BE SUBJECT TO THE FINAL ORDERS IN CWP NOS. 6797/99 (K.K. GUPTA VS. UOI) 6798/99 (B.R. JAIN VS. UOI) 7241/99 (SH. D.K. TYAGI VS. UOI) 7714/99 (B.R. MITTAL VS. UOI) AND 135/2000 (UOI VS. P.K. BANSAL) PENDING BEFORE THE HIGH COURT OF DELHI. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 21 26. SHRI RAKESH GUPTA IN HIS COMPILATION FILED COPY OF THE RECRUITMENT RULES WHICH WERE SENT TO HIM. HE ACCEPTED THE OFFE R OF APPOINTMENT. HE JOINED THE TRIBUNAL ON 16-8-2000. HE SUBMITTED HIS RESIGNATION DURING THE PROBATION ITSELF AND THE SAID RESIGNATION WAS ACCEP TED FROM 21-3-2001. THE SAID ACCEPTANCE IT MAY BE STATED WAS DONE BY THE G OVERNMENT EVEN BY WAIVING THE NOTICE PERIOD OF ONE MONTH AS MENTIONE D IN THE ACCEPTANCE LETTER. IT MAY ME MENTIONED THAT BEFORE JOINING TH E TRIBUNAL DR. RAKESH GUPTA PRACTICED BETWEEN 1984 TO 2000 AND APPEARED B EFORE DELHI BENCHES OF THE ITAT IN VARIOUS CASES FROM 1990 TO 2000. AFT ER HE RESIGNED DR. GUPTA STARTED PRACTICING AS AN ADVOCATE FROM MAY 20 01 AND HAS BEEN APPEARING BEFORE THE TRIBUNAL MAINLY BEFORE DELHI B ENCHES OF THE ITAT REGULARLY SINCE THEN. IT WAS STATED BY HIM THAT HE WAS NEVER POSTED AT DELHI BENCHES WHERE HE HAS BEEN PRACTICING. IT MAY BE ME NTIONED THAT BEFORE HE RESIGNED HE WAS POSTED AT HYDERABAD BENCHES OF THE ITAT. THE CASE OR DR. RAKESH GUPTA IS THAT HE IS NOT HIT BY NOTIFICATIO N NO. GSR 389(E) DATED 3 RD JUNE 2009 AND IS ENTITLED TO APPEAR FOR THE PARTIE S DESPITE RULE 13E OF THE INCOME-TAX APPELLATE TRIBUNAL MEMBERS (RECRUITMEN T AND CONDITIONS OF SERVICE )RULES 1963 AS ACCORDING TO HIM HE IS NOT THE ONE WHO RETIRED FROM THE SERVICE OF THE TRIBUNAL BUT HE HAS RESIGNED FRO M SERVICE THAT TOO DURING THE PROBATION PERIOD ITSELF. HE WAS NOT EVEN CONFI RMED IN THE SERVICE FROM ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 22 THE POST THAT WAS ALWAYS REMAINED TEMPORARY DURING HIS SERVICE AND SUBJECT TO SEVERAL STIPULATED UNCERTAIN CONDITIONS. ONLY T HE PERSONS SPECIFIED IN THE SAID NOTIFICATION WHO RETIRE FROM SERVICE OF THE TR IBUNAL ARE ONLY PROHIBITED. ACCORDING TO HIM HE HAS NOT RETIED FROM SERVICE B UT RESIGNED FROM SERVICE. THE RETIREMENT ACCORDING TO DR. RAKESH GUPTA HAS A DEFINITE CONNOTATION IN THE SERVICE REGULATION FOR WHICH RULE 11 OF THE RECRUITMENT RULES WAS RELIED UPON BY SHRI RAKESH KUMAR GUPTA WHICH READS AS UNDER: THE DATE OF RETIREMENT OF A MEMBER SHALL BE THE DA TE ON WHICH HE ATTAINS THE AGE OF SIXTY TWO YEARS AND NOT THE LAST DATE OF THE MONTH AS IN THE CASE OF OTHER GOVERNMENT SERVANTS. 27. IT WAS ALSO POINTED OUT THAT THE SAID RULE WAS AMENDED SUBSEQUENTLY VIDE NOTIFICATION GSR NO. 753(E) DATED 29 TH DECEMBER 2005 WHICH READS AS UNDER: 1) RETIREMENT THE DATE OF RETIREMENT OF (A) THE PRESIDENT SHALL BE THE DATE ON WHICH HE ATT AINS THE AGE OF SIXTY YEARS. (B) THE SENIOR VICE PRESIDENT VICE PRESIDENT AND MEMBER SHALL BE THE DATE ON WHICH THY ATTAIN THE AG E OF SIXTY TWO YEARS AND NOT THE LAST DATE OF THE MONTH AS IN THE CASE O F OTHER GOVERNMENT SERVANT. OUR ATTENTION WAS FURTHER DRAWN TO FUNDAMENTAL RULE 56 WHICH APPLIES TO OTHER GOVERNMENT SERVICES WHICH READS AS UNDER: ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 23 F.R. 56. (A) EXCEPT AS OTHERWISE PROVIDED IN THIS RULE EVERY GOVERNMENT SERVANT SHALL RETIE FROM SERVICE ON THE AFTERNOON O F THE LAST DAY OF THE MONTH IN WHICH HE ATTAINS THE AGE OF SIXTY YEARS; PROVIDED THAT A GOVERNMENT SERVANT WHOSE DATE OF BI RTH IS THE FIRST OF A MONTH SHALL RETIRE FROM SERVICE ON THE AFTERNOON OF THE LAST DAY OF THE PRECEDING MONTH ON ATTAINING THE AGE OF SIXTY YEARS . [PROVIDED FURTHER THAT A GOVERNMENT SERVANT WHO HAS ATTAINED THE AGE OF FIFTY-EIGHT EARS ON OR BEFORE THE FIRST DAY OF MAY 1998 AND IS ON EXTENSION IN SERVICE SHALL RETIRE FROM THE SERVICE ON EXPIRY OF HIS EXTENDED PERIOD OF SERVICE. OR ON THE EXPIRY OF ANY FURTHER EXTENSION IN SERVI CE GRANTED BY THE CENTRAL GOVERNMENT IN PUBIC INTEREST PROVIDED THAT NO SUCH EXTENSION IN SERVICE SHALL BE GRANTED BEYOND THE AGE OF 60 YEARS. 28. ACCORDING TO DR. RAKESH GUPTA THE RETIREMENT C AN BE AT SUPERANNUATION VOLUNTARY RETIREMENT ON COMPLETING PRESCRIBED YEARS OF SERVICE; OR A COMPULSORY RETIREMENT BY EMPLOYER. AC CORDING TO HIM THE RETIREMENT TAKES PLACE NORMALLY AT SUPERANNUATION O R ON COMPLETION OF QUALIFIED PERIOD OF SERVICE. IN HIS CASE AND IN THE CASES OF FOUR OTHERS THERE IS NO RETIREMENT BUT THEY HAVE RESIGNED FROM SERVIC E. THE RESIGNATION IS NOT THE SAME THING AS RETIREMENT. THIS DIFFERENCE ACCO RDING TO HIM WAS NOTICED BY THE SUPREME COURT IN THE CASE OF UCO BANK & OTHE RS VS. SANWAR MAL AIR 2004 SC 2135. IN THAT CASE ACCORDING TO SHRI RAKESH GUPTA THE SUPREME COURT WENT THROUGH DIFFERENT REGULATIONS AN D OPINED THAT THE EXPRESSIONS RESIGNATION AND RETIREMENT HAVE BE EN EMPLOYED FOR DIFFERENT PURPOSES AND CARRY DIFFERENT MEANINGS. AN EMPLOYEE CAN RESIGN AT ANY POINT OF TIME EVEN ON THE SECOND DAY OF HIS APPOINTMENT B UT IN CASE OF RETIREMENT ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 24 HE RETIRES ONLY AFTER ATTAINING THE AGE OF SUPERANN UATION OR IN CASE OF VOLUNTARY RETIREMENT ON COMPLETION OF QUALIFYING S ERVICE. THE EFFECT OF RESIGNATION AND RETIREMENT TO THE EXTENT THAT THERE IS SEVERANCE OF EMPLOYMENT IS COMMON BUT IN SERVICE JURISPRUDENCE B OTH THE EXPRESSIONS ARE UNDERSTOOD DIFFERENTLY. ACCORDING TO HIM THE D ECISION OF THE SUPREME COURT IN THE CASE OF UCO BANK (SUPRA) TAKES HIM AND LIKE INTERVENERS OUT OF THE PURVIEW OF RULE 13E OF THE INCOME TAX APPELLATE TRIBUNAL MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE) RULES 1963 . RELIANCE WAS ALSO PLACED ON THE RATIO OF DECISION OF RAJASTHAN HIGH C OURT IN THE CASE OF SOHAN LAL SONI (MANU/RH/0617/2006). 29. OUR ATTENTION WAS DRAWN TO THE DECISION OF SUPR EME COURT IN THE CASE OF JAIPAL SINGH VS. SMT. SUMITRA MAHAJAN & ANOTHER AIR 2004 SCW 2010 TO CONTEND THAT IN THE CASE OF RESIGNATION THE RELA TIONSHIP OF EMPLOYER AND EMPLOYEE TERMINATES ON ACCEPTANCE OF RESIGNATION WH EREAS IN THE CASE OF RETIREMENT VOLUNTARY OR ON SUPERANNUATION THE REL ATIONSHIP CONTINUES FOR THE PURPOSE OF PAYMENT OF RETIREMENT BENEFITS. 30. OUR ATTENTION WAS FURTHER DRAWN TO CLAUSE 26 O F THE CENTRAL SERVICES (PENSION) RULES WHEREIN IT IS PROVIDED THAT RESIGN ATION FROM A SERVICE OR A POST ENTAILS FORFEITURE OF PAST SERVICE. ACCORDING TO HIM ONCE RESIGNATION IS ACCEPTED AND PAST SERVICE HAS BEEN FORFEITED HE CO ULD NOT POSSIBLE BE PUT IN ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 25 THE SAME BRACKET WITH THOSE WHO CONTINUE TO RECEIVE BENEFITS ON THE BASIS OF THEIR PAST SERVICE WITH THE GOVERNMENT EVEN AFTER R ETIREMENT OR REEMPLOYMENT AS PROVIDED IN THE SAID REGULATION. TH US PAST SERVICE RENDERED BY HIM IT WAS STRONGLY ARGUED IS NON EST AS THE S AME HAS BEEN FORFEITED AFTER RESIGNATION AS PROVIDED IN THE AFORESAID RULES. TH US ACCORDING TO HIM THIS MUST BE APPRECIATED IN THE LIGHT OF THE FACT THAT H E WAS NOT EVEN CONFIRMED IN SERVICE AND WAS STILL ON PROBATION AND THAT TOO ON TEMPORARY POST. AFTER THE RESIGNATION THERE COULD BE NO QUESTION OF THE SAID NOTIFICATION BEING APPLICABLE TO HIM AS WITHIN THE SAID PROVISIONS OF RULE 13E HE COULD NOT BE TREATED AS A PERSON WHO HAS RETIRED. A TEMPORARY PO ST IS A POST SANCTIONED FOR A LIMITED TIME. THESE POSTS ARE OVER AND ABOVE THE PERMANENT STRENGTH AND ARE SANCTIONED TO COPE WITH TEMPORARY RUSH OF WORK OR TO DISCHARGE SPECIAL FUNCTIONS WHICH ARE NOT OF A PERMANENT NATURE. O UR ATTENTION WAS DRAWN TO THE DECISION OF THE SUPREME COURT IN THE CASE OF KE DARNATH VS. STATE OF PUNJAB AIR 1972 SC 873 HELD THAT THE PHRASE LIKELY TO CONTINUE WITH A TEMPORARY POST DOES NOT MEAN AN ASSURANCE THAT THE POST WILL BE PERMANENT. IN FACT IN THE CASE OF KEDARNATH BAHL VS. STATE OF PUNJAB AIR 1979 SC 220 THE SUPREME COURT HELD THAT THERE COULD BE NO QUEST ION OF CONFIRMATION IF THE POST ITSELF IS TEMPORARY. IT WAS AGAIN ARGUED B Y SHRI RAKESH KUMAR GUPTA THAT DURING PROBATION THERE IS NO QUESTION OF RIGHT TO THE POST. THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 26 HONBLE SUPREME COURT IN THE CASE OF PURSHOTTAM LAL DHINGRA VS. UOI AIR 1958 SC 36 AT PAGE 42 HAVE ELABORATED THE CONCEPT O F PROBATION IN THESE WORDS:- AN APPOINTMENT TO A PERMANENT POST IN GOVERNMENT S ERVICE ON PROBATION MEANS . THAT THE SERVANT SO APPOINTED I S TAKEN ON TRIAL. 31. DR. RAKESH KUMAR GUPTA ARGUED THAT IN HIS CASE EVEN THE APPOINTMENT AS NOT TO A PERMANENT POST. OUR ATTENTION WAS FURTH ER DRAWN TO THE DECISION OF THE SUPREME COURT IN THE CASE OF STATE OF U.P. V S. KAUSHAL KISHORE SHUKLA (1991) 1 SCC 691 WHEREIN IT HAS BEEN HELD TH AT PROBATIONER DOES NOT ACQUIRE ANY SUBSTANTIVE RIGHT TO THE POST AND HIS R IGHT TO CONTINUE WOULD ARISE ONLY ON CONFIRMATION. THE SUPREME COURT IN THE CASE OF PURSHOTTAM LAL DHINGRAS CASE (SUPRA) HAS HELD THAT BEFORE CONFIRM ATION A PROBATIONER HAS NO RIGHT TO HOLD THE POST. TO THE SAME EFFECT IS TH E DECISION OF SUPREME COURT IN THE CASE OF S.P. VASUDEVA VS. STAT OF HARY ANA AIR 1975 SC 2292 AS ALSO THE DECISION OF APEX COURT IN THE CASE OF S TATE OF U.P. VS. AKBAR ALI KHAN AIR 1966 SC 1842. IN THE LATTER CASE IT WAS HE LD THAT SO LONG AS A PERSON CONTINUES AS A PROBATIONER HE ACQUIRES NO S UBSTANTIVE RIGHT TO HOLD THE POST; AND IN THE FIRST CASE ACCORDING TO DR. G UPTA IT WAS HELD THAT ADHOC OR TEMPORARY EMPLOYEE HAS NO RIGHT TO THE POST. IN VIEW OF THE AFORESAID DECISION OF THE SUPREME COURT IN SO MANY CASES IT CANNOT BE SAID THAT HE IS ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 27 THE ONE WHO RETIRED FROM SERVICE WITHIN THE MEANING OF RULE 13E OF THE SAID NOTIFICATION. HE ALSO TOOK ANOTHER OBJECTION THAT ON THE TERMS AND CONDITIONS ON WHICH THE OFFER OF APPOINTMENT WAS M ADE TO HIM OR EVEN THE APPLICATION WAS CALLED RULE 13-E WAS NOT THERE IN THE INCOME TAX APPELLATE TRIBUNAL MEMBERS (RECRUITMENT AND CONDITIONS OF SER VICE) RULES 1963 MEANING THEREBY HE COULD NOT BE SUBJECT TO ANY RUL E THAT WAS NOT THERE IN THE SAID RECRUITMENT RULES WHEN HE JOINED THE SERVICE O R AT LEAST WHEN HE RESIGNED FROM THE SERVICE. HAD THESE CONDITIONS BE EN SHOWN TO BE THERE HE WOULD NOT HAVE EVEN JOINED THE SERVICE. OUR ATTENT ION WAS ALSO DRAWN TO THE DECISION OF THE SUPREME COURT IN THE CASE OF STATE OF GUJARAT VS. RAMAN LAI (1983) 2 SCR 287 WHEREIN IT WAS STATED THAT LE GISLATION CANNOT IGNORE THE MARCH OF EVENTS OVER A PERIOD OF TIME AND THE R IGHTS ACCRUING THEREBY. AFTER ALL NOTIFICATION OR THE LAW MUST SATISFY T HE REQUIREMENTS OF THE CONSTITUTION TODAY TAKING INTO ACCOUNT THE ACCRUED OR ACQUIRED RIGHTS OF THE PARTIES AS ON DATE. THE LAW CANNOT SAY TWENTY YEAR S AGO THE PARTIES HAD NO RIGHT. A LEGISLATURE CANNOT LEGISLATE TODAY WITH RE FERENCE TO A SITUATION THAT OBTAINED TWENTY YEARS AGO AND IGNORE THE MARCH OF E VENTS AND THE CONSTITUTIONAL RIGHTS ACCRUED IN THE COURSE OF THE TWENTY YEARS. THAT WOULD BE MOST ARBITRARY UNREASONABLE AND A NEGATION OF H ISTORY. HE ALSO RELIED ON THE DECISION OF SUPREME COURT IN THE CASE OF P.D. A GGARWAL VS. STATE OF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 28 U.P. AIR 1987 SC 1676. IT WAS PLEADED THAT AMENDMEN T OF RULE LIKE THE ONE THAT IS BEING MADE CANNOT TAKE AWAY THE VESTED RIG HTS AND ANY SUCH AMENDMENT MUST BE REASONABLE. DR. GUPTA REFERRED TO THE DECISION OF THE APEX COURT IN THE CASE OF SATISH CHANDRA VS. UOI AI R 1953 SC 250 ON THE POINT OF CONDITIONS OF SERVICE BEING GOVERNED BY THE CONTRACT AND CONTENDED THAT ALTHOUGH THE GOVERNMENT CAN ENTER INTO CONTRACTS AND IMPOSE SPECIAL TERMS THAT SOME ONE WOULD BE INELIG IBLE TO PRACTICE THE SPECIAL TERM MUST EXIST AT THE TIME WHEN HE JOINED THE SERVICE AND SUCH TERM MUST BE ACCEPTED TO BECOME EFFECTIVE WHEREAS IN HIS CASE IT WAS PLEADED THAT THERE WAS NO TERM AT THE TIME WHEN THE ACCEPTED OR WHEN HE RELINQUISHED HENCE NO QUESTION OF ACCEPTANCE ON HIS PART. EVEN T HE STATE ACCORDING TO HIM IS BOUND BY THE TERM OR ABSENCE OF TERM. RELIA NCE WAS ALSO PLACED ON THE DECISIONS OF SUPREME COURT IN THE CASES OF STAT E OF M.P. VS. SHARDUL SINGH (1970) 3 SCR 302; AND I.N. SUBBA REDDY VS. AN DHRA UNIVERSITY (1976) 3 SCR 1013 WHEREIN IT HAS BEEN HELD THAT TH E EXPRESSION CONDITIONS OF SERVICE MEANS ALL THOSE CONDITIONS WHICH REGULA TE THE HOLDING OF A POST BY A PERSON RIGHT FROM THE TIME OF HIS APPOINTMENT TILL HIS RETIREMENT AND EVEN BEYOND IT IN MATTERS LIKE PENSION. 32. NEXT ATTENTION WAS DRAWN TO THE DECISION OF SUP REME COURT IN THE CASE OF STATE OF PUNJAB VS. KAILASH NATH (1989) 1 SCC 3 21 WHEREIN THEIR ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 29 LORDSHIPS HAVE HELD THAT THE TERM CONDITIONS OF SE RVICE WOULD INCLUDE THE FOLLOWING: I) SALARY OR WAGES INCLUDING SUBSISTENCE ALLOWANCE DURING SUSPENSION II) PERIODICAL INCREMENTS III) PAY SCALE IV) LEAVE V) PROVIDENT FUND VI) GRATUITY VII) CONFIRMATION VIII) PROMOTION IX) SENIORITY X) TENURE OR TERMINATION OF SERVICE XI) SUPERANNUATION XII) COMPULSORY OR PREMATURE RETIREMENT XIII) PENSION XIV) CHANGING THE AGE OF SUPERANNUATION XV) DEPUTATION XVI) DISCIPLINARY PROCEEDING. 33. DR. GUPTA SUBMITTED THAT EVEN FOR THE SAKE OF A RGUMENT IT IS PRESUMED THAT THIS KIND OF A BAR COULD BE PART OF THE SERV ICE CONDITIONS CAN THE SAID POWER UNDER ARTICLE 309 OF THE CONSTITUTION BE USED TO ALTER THE CONDITIONS OF SERVICE AFTER THE SAID SERVICE ITSELF STANDS FORFE ITED. THE GOVERNMENT REGULATIONS OR CONDITIONS OF SERVICE CANNOT BE APPL IED TO HIM WHEN HE IS NO LONGER IN SUCH SERVICE. ARTICLE 309 DOES NOT EMPOW ER THE PRESIDENT OF INDIA TO IMPOSE RESTRICTIONS UNDER THE COLOUR OF CONDITI ONS OF SERVICE UPON THE PERSONS WHO ARE NO MORE THE GOVERNMENT SERVANTS AND CANNOT EVEN BE TERMED AS PAST SERVANTS AFTER HAVING FORFEITED THEI R SERVICE AND SPECIALLY PAST SERVANTS WHO GOT THEIR SERVICE FORFEITED DUE TO RES IGNATION. SHRI RAKESH GUPTA FURTHER ARGUED THAT PROVISIONS OF SECTION 288 OF THE INCOME-TAX ACT ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 30 READ WITH RULE 2(II)(A) OF THE INCOME TAX (APPELLAT E TRIBUNAL ) RULES 1963 AUTHORIZED HIM TO APPEAR BEFORE THE TRIBUNAL AND TH E SAID AUTHORITY CANNOT BE TAKEN AWAY THROUGH THE IMPUGNED NOTIFICATION WHI CH MERELY SEEKS TO LAY DOWN THE SERVICE CONDITIONS AND SUCH SERVICE CONDIT IONS ACCORDING TO HIM ARE APPLICABLE ONLY TO SERVING EMPLOYEES AND NOT T O PERSONS WHO HAVE RESIGNED LONG BACK. THE ITAT ACCORDING TO HIM SHO ULD NOT BAR HIM FROM APPEARING BEFORE THE TRIBUNAL. IF HE IS BARRED FROM APPEARING IT WILL BE DENIAL OF PRINCIPLES OF NATURAL JUSTICE. IF ONE VI OLATES A SERVICE CONDITION THE GOVERNMENT WHICH WANTS TO ENFORCE THE SERVICE CON DITION UPON HIM CAN TAKE ACTION BUT CERTAINLY THE ITAT AS A JUDICIAL B ODY CANNOT PREVENT HIM FROM ARGUING THE CASE EITHER FOR THE ASSESSEE OR FO R THE DEPARTMENT. 34. NEXTLY IT WAS ARGUED THAT THE DECISION OF HONB LE DELHI HIGH COURT IN THE CASE OF P.C. JAIN (SUPRA) WAS NOT APPLICABLE T O HIM AND TO THE OTHER INTERVENERS WHO ARE IDENTICALLY PLACED AS THE FA CTS IN THAT CASE ARE TOTALLY DIFFERENT. ACCORDING TO HIM IN THE CASE OF P.C. JA IN (SUPRA) THEIR LORDSHIPS OF DELHI HIGH COURT WERE MAINLY CONCERNED WITH INT ERPRETATION OF SEC. 129(6) OF THE CUSTOMS ACT AND WERE NOT CONCERNED WI TH ANY INTERPRETATION AS TO THE CONDITIONS OF SERVICE. MOREOVER IT WAS EMPHASIZED BY DR. GUPTA THAT IN THE CASE OF P.C. JAIN (SUPRA) NONE OF THE INSTANCES DISCUSSED THEREIN PERTAINED TO THE MEMBERS WHO HAVE RESIGNED FROM SE RVICE. THE TERMINOLOGY ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 31 USED IN RULE 129(6) AND RULE 13E ARE DIFFERENT AND IS TO BE JUDICIALLY RECOGNIZED BEFORE VIEWS ARE DRAWN DEBARRING THE E LIGIBLE PERSONS U/S 288 OF THE I.T. ACT FROM APPEARING BEFORE THE ITAT. IT WI LL BE DENIAL OF OPPORTUNITY WHICH ACCORDING TO HIM IS NOT WARRAN TED EVEN ON THE BASIS OF DECISION OF DELHI HIGH COURT IN THE CASE OF P.C. JA IN (SUPRA). 35. IN THE CASE OF SHRI VED JAIN BY LETTER DATED 2 1-11-1997 HE WAS OFFERED THE POST OF ACCOUNTANT MEMBER IN ITAT. THE CONDITIONS ON WHICH THE POST WAS OFFERED WERE THE SAME AS IN THE CASE OF DR. RAKESH KUMAR GUPTA EXCEPT CONDITION NO. 13 AS SPELT OUT IN THE CASE OF DR. RAKESH KUMAR IS NOT THERE. ON 27-3-1998 SHRI VED JAIN SUBMITTED HIS RESIGNATION TO THE PRESIDENT WHICH WAS ACCEPTED WITH EFFECT FROM THE AFTERNOON OF 27 TH APRIL 1998 BY THE GOVERNMENT. IT MAY BE MENTIONED THAT TH E DURATION OF SHRI VED JAIN AS MEMBER IN THE ITAT WAS APPROXIMATELY FOR A PERIOD OF 4 MONTHS. IT WAS POINTED OUT BY SHRI VED JAIN THAT HE DID NOT PR ESIDE OVER ANY OF THE BENCHES OF THE ITAT AND HE WAS PURELY ON ORIENTATIO N AND TRAINING AT HYDERABAD DURING THAT PERIOD. THE ARGUMENTS OF SHRI VED JAIN ARE IDENTICAL TO THE ONE THAT WERE MADE BY SHRI RAKESH KUMAR GUPT A. 36. IN THE CASE OF SHRI ANOOP SHARMA ADVOCATE HE JOINTED THE ITAT AS JUDICIAL MEMBER AT MUMBAI ON 27-3-1989 AND RESIGNED FROM SERVICE ON 31- ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 32 5-1990. THE TERMS AND CONDITIONS OF APPOINTMENT OF SHRI ANOOP SHARMA ARE ALMOST IDENTICAL TO THE CASE OF SHRI RAKESH KUMAR G UPTA. 37. IN THE CASE OF SHRI Y.K. KAPOOR HE JOINTED TH E ITAT AS JUDICIAL MEMBER ON 3-12-2001 AND RESIGNED FROM SERVICE ON 16 -4-2004 AND RELINQUISHED FROM DUTIES W.E.F. 1-7-2004. IT WAS PL EADED BY SHRI Y.K. KAPOOR THAT TERMS OF APPOINTMENT CONTAINED AS THOSE OF OTHER MEMBERS. THE APPOINTMENT WAS PURELY FOR A TEMPORARY POST AND PRO BATION OF TWO YEARS. IT WAS SUBMITTED BY HIM THAT HIS PROBATION WAS NOT CLE ARED. HE WAS NOT CONFIRMED IN SERVICE. RELIANCE WAS PLACED ON THE RA TIO OF DECISION OF APEX COURT IN THE CASE OF STATE OF PUNJAB VS. DHARAM SIN GH AIR 1968 SC 1210 TO CONTEND THAT WHEN AN APPOINTMENT IS MADE ON PROB ATION FOR A SPECIFIC PERIOD AND THE EMPLOYEE IS ALLOWED TO CONTINUE IN T HE POST AFTER THE EXPIRY OF THE PERIOD WITHOUT ANY SPECIFIC ORDER OF CONFIRMATI ON HE SHOULD BE DEEMED TO CONTINUE IN HIS POST AS A PROBATIONER ONLY. AN E XPRESS ORDER OF CONFIRMATION IS NECESSARY TO GIVE THE EMPLOYEE A SU BSTANTIVE RIGHT TO THE POST AND FROM THE MERE FACT THAT HE IS ALLOWED TO C ONTINUE IN THE POST AFTER THE EXPIRY OF THE SPECIFIED PERIOD OF PROBATION IT IS NOT POSSIBLE TO HOLD THAT HE SHOULD BE DEEMED TO HAVE BEEN CONFIRMED. RELIANC E WAS PLACED ON THE RATIO OF DECISIONS OF APEX COURT IN THE CASES OF SU KHBANS SINGH VS. THE STATE OF PUNJAB MANU/SC/0356/1962; AND STATE OF U.P . VS. AKBAR ALI ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 33 MANU/SC/0231/1966 AND IT WAS SUBMITTED THAT HE COUL D NOT BE CONSIDERED TO BE RETIRED FROM SERVICE. HE COULD AT BEST BE REG ARDED AS RESIGNED FROM SERVICES. ALL THE CASE LAWS CITED BY SHRI RAKESH KU MAR GUPTA WERE RELIED UPON. RELIANCE WAS PLACED ON THE RATIO OF DECISION OF DELHI HIGH COURT IN THE CASE OF RAJ BHASKAR VS. ORIENTAL INSURANCE CO. LTD . MANU/DE/9223/2006 WHEREIN THEIR LORDSHIPS APPLYING THE PRINCIPLE LAI D DOWN BY THE SUPREME COURT IN THE CASE OF UCO BANK (SUPRA) HELD THAT TH E RESIGNATION AND THE RETIREMENT CANNOT BE TAKEN TOGETHER. OUR ATTENTION WAS DRAWN TO THE DECISION OF RAJASTHAN HIGH COURT IN THE CASE OF SOHAN LAL S ONI VS. STATE OF RAJASTHAN & OTHERS RLW 2007(2) RAJ 1044. SHRI Y.K. KAPOOR FURTHER SUBMITTED THAT THE SUPREME COURT AGAIN NOTICED THE SAME DIFFERENCE BETWEEN RESIGNATION AND RETIREMENT IN THE CASE OF CHANDRASH EKAR A.K. VS. STATE OF KERALA & ANR. AIR 2009 SC 643. HAVING REGARD TO THE FACTS THAT HE COULD NOT BE CONSIDERED TO HAVE RETIRED WITHIN THE MEANIN G OF RULE 11 OF THE INCOME TAX APPELLATE TRIBUNAL MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE) RULES 1963. OUR ATTENTION WAS SPECIFICAL LY DRAWN TO PARA 26 OF THE DECISION OF THE DELHI HIGH COURT IN THE CASE OF P.C . JAIN (SUPRA) AS REPRODUCED BELOW: 26. IN OUR VIEW THE TWO CASES CITED BY THE PETITI ONERS ARE CLEARLY DISTINGUISHABLE. IN BOTH THE CASES THE COURT STRUCK DOWN THE BAR PLACED ON THE LEGAL PRACTITIONERS TO PRACTICE BEFORE THE TRIB UNAL CONSTITUTED UNDER THE CONCERNED STATUTES ON THE GROUND THAT THE PROHIBITI ON WAS ENACTED BY THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 34 STATE WHICH TRENCHED UPON THE RIGHT TO PRACTICE CON FERRED BY A LAW ENACTED BY THE PARLIAMENT AND HENCE THE STATE LAW WAS BAD I N SO FAR AS IT TRENCHED UPON THE LAW ENACTED BY THE PARLIAMENT. IN THE INSTANT CASE THE IMPUGNED PROVISION IS INCORPORATED IN THE CENTRAL S TATUTE. HENCE THE SAID RATIO OF THESE AFOREMENTIONED DECISION WOULD N OT APPLY TO THE INSTANT CASE . 38. OUR ATTENTION WAS DRAWN TO THE DECISION OF THE SUPREME COURT IN THE CASE OF T.R. KAPUR VS. STATE OF HARYANA AIR 1987 SC 415. ACCORDING TO HIM HIS CASE ALONG WITH LIKE PERSONS WHO HAD RESIG NED AND NOT RETIRED MUCH BEFORE THE DATE OF PROMULGATION OF THE IMPUGNED NO TIFICATION DATED 3-6- 2009 THUS CANNOT SAID TO BE AFFECTED BY IT EVEN IF IT IS ASSUMED THOUGH NOT ADMITTED THAT THEY COME WITHIN THE GENERAL SWEEP OF THE SAID NOTIFICATION. OUR ATTENTION WAS ALSO DRAWN TO THE DECISION OF TH E SUPREME COURT IN THE CASE OF K.C. ARORA & ANOTHER VS. STATE OF HARYANA AIR 1987 SC 1858. SHRI Y.K. KAPUR DREW OUR ATTENTION TO PARA 11 OF THE AF FIDAVIT FILED BY THE MINISTRY OF LAW & JUSTICE THAT ON THE BASIS OF ANA LOGY THE MEMBERS OF THE TRIBUNAL WHO RESIGNED FROM SERVICE WHEN NOT CONFIRM ED WITHOUT RETIREMENT BENEFITS MAY PLEA THAT THEY SHOULD NOT BE DEBARRED FROM PRACTICING BEFORE ITAT IN THE SAID PARA THE MINISTRY SUGGESTED THAT MAGNANIMOUS VIEW NEED TO BE TAKEN BY THE ITAT. THEREFORE IN THE LIGHT OF THIS IT WAS PLEADED THAT A MAGNANIMOUS VIEW BE TAKEN IN FAVOUR OF THE INTERVEN ERS LIKE HIM AND DECLARE THAT THEY ARE NOT DEBARRED FROM PRACTICING BEFORE THE ITAT. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 35 39. IN THE CASE OF SHRI SALIL KAPOOR ADVOCATE HE JOINED THE ITAT AS JUDICIAL MEMBER ON 1-3-2005. THE TERMS OF APPOINTME NT BY WHICH THE OFFER WAS MADE ARE THE SAME THAT THE POST IS SAID TO BE TEMPORARY AND SERVICE CONDITIONS ARE GOVERNED BY THE INCOME TAX APPELLATE TRIBUNAL MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE) RULES 1963 (COPY ENCLOSED) AND THE PERIOD OF PROBATION IS STATED TO BE 2 YEARS WIT H AN OPTION THAT IT CAN BE EXTENDED AT THE DISCRETION OF THE APPOINTING AUTHOR ITY. ON THESE CONDITIONS SHRI SALIL KAPOOR JOINED THE SERVICE ON 1-3-2005. O N 14-8-2006 HE GAVE A NOTICE OF RESIGNATION AND THE RESIGNATION WAS ACCEP TED WITH EFFECT FROM THE AFTERNOON OF 13 TH SEPTEMBER 2006. IT IS CLEAR THAT THE SAID RESIGNAT ION IS WITHIN THE PERIOD OF PROBATION. SHRI SALIL KAPUR A RGUED THAT HE WAS NEVER POSTED AT DELHI BENCHES WHERE HE IS PRACTICING AND HIS CASE IS THAT OF RESIGNATION FROM SERVICE AND NOT RETIREMENT. RELIAN CE WAS PLACED ON THE RATIO OF DECISIONS OF SUPREME COURT IN THE CASES OF UOI VS. GOPAL CHANDRA MISHRA (1978) 2 SCC 301; UCO BANK & OTHERS AIR 200 4 SC 2135; AND JAIPAL SINGH VS. (SMT.) SUMITRA MAHAJAN 2004 AIR SC W 2010 WHEREIN THE DIFFERENCE BETWEEN RESIGNATION AND RETIREMENT IS JU DICIALLY NOTICED. HE ARGUED ON THE SAME LINES AS IN THE CASE OF SHRI RAK ESH GUPTA. 40. ON BEHALF OF THE MINISTRY SHRI A.K. BHARDWAJ S R. CENTRAL GOVT. COUNSEL APPEARED AND HAS FILED DETAILED AFFIDAVIT. IT WAS PLEADED THAT IN THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 36 LIGHT OF THE DECISION OF DELHI HIGH COURT IN THE C ASE OF P.C. JAIN (SUPRA) WHICH INTERPRETED THE IDENTICAL PROVISION OF SECTIO N 129(6) OF CUSTOMS ACT 1962 THERE IS A POSSIBILITY TO DEBAR THE APPEARANC E OF SUCH MEMBERS ALSO. IN VIEW OF DIGNITY OF OFFICE AND PERCEPTION OF BIAS S UCH MEMBERS ON THEIR OWN SHOULD REFRAIN FROM APPEARING AND PRACTICING BEFORE THE TRIBUNAL WHEREIN THEY HAVE ADJUDICATED THE DISPUTE OF OTHERS. ACCORD ING TO HIM ALTHOUGH MANY OF THE INTERVENERS HAVE QUESTIONED THE LEGISLA TIVE COMPETENCE FOR ENACTING RULE 13E INTO THE SERVICE CONDITIONS AND HAVE ALSO QUESTIONED ITS VALIDITY AS DISCRIMINATORY AND VIOLATIVE OF ARTICLE 14 19 AND 309 OF THE CONSTITUTION OF INDIA IN SO FAR AS THESE QUESTIONS ARE RAISED BY THE INTERVENERS THIS TRIBUNAL IS NOT COMPETENT TO GO I NTO THE WARRANTS OF THE LEGISLATION IN THE MANNER CANVASSED BY THE INTERVEN ERS AND IT SHOULD BE REJECTED AT THE THRESHOLD. AS A RESULT THE MEMBERS WHO HAVE RESIGNED FROM SUCH POSTS WHILE THEY WERE IN PROBATION AN ANALOGY MAY BE DRAWN TO ARTICLE 220 OF THE CONSTITUTION WHERE PROVISION OF APPOINT MENT OF A PERMANENT JUDGE OF THE HIGH COURT AND PERSONS WHO HAVE RESIGN ED BEFORE BECOMING PERMANENT MAY NOT BE DEBARRED UNDER ARTICLE 221 OF THE CONSTITUTION. ON THE SAME ANALOGY SUCH MEMBERS OF THE TRIBUNAL WHO R ESIGNED FROM SERVICE WHEN NOT CONFIRMED WITHOUT RETIREMENT BENEFITS MAY PLEAD THAT THEY SHOULD NOT BE DEBARRED FROM PRACTICING BEFORE ITAT. HOWEVE R THIS CONTROVERSY ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 37 CANNOT BE LEFT HERE FOR THE REASON THAT IN THE CASE OF P.C. JAIN WHERE IDENTICAL PROVISIONS WERE SUBJECT MATTER OF CONSIDE RATION BY THE HIGH COURT THEY MAY ALSO BE HIT BY RULE 13E BUT ON THE SAID Q UESTION OF THEIR RIGHT TO PRACTICE A MAGNANIMOUS VIEW MAY BE TAKEN. THIS WAS STATED IN PARA 11 OF THE AFFIDAVIT AS REFERRED TO BY SOME OF THE INTERV ENERS. ACCORDINGLY RULE 13E MAY NOT DISQUALIFY SUCH PERSONS FROM PRACTICIN G U/S 288 OF THE I.T. ACT. THE INTENTION OF RULE 13E ACCORDING TO HIM WAS TO AVOID ANY KIND OF PERCEPTION OF A LITIGANT THAT THE DECISION IN ANY C ONTROVERSY COULD BE INFLUENCED BY APPEARANCE OF A RETIRED MEMBER OF THE TRIBUNAL. HE RELIED UPON THE AFFIDAVIT ON MERIT AND PLEADED THAT THE RA TIO OF DECISION IN THE CASE OF P.C. JAIN (SUPRA) MAY STILL BE MADE APPLICABLE T O ALL THE CASES INCLUDING THE CASES OF RESIGNED MEMBERS. 41. SHRI BHARDWAJ FURTHER SUBMITTED THAT PROVISIONS OF SECTION 129(6) OF THE CUSTOMS ACT AND RULE 13E INSERTED IN THE INCOM E TAX APPELLATE TRIBUNAL MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE) RUL ES 1963 ARE ALMOST IDENTICAL. THE MANNER OF THE LEGISLATION WHETHER T HEY ARE BROUGHT INTO THE STATUTE BY AMENDMENT TO THE ACT OR THEY ARE BROUGHT INTO FORCE BY AMENDMENT IN THE CONDITIONS OF SERVICE RULES DOES NOT MAKE ANY DIFFERENCE SO FAR AS THE OBJECT TO BE ACHIEVED BY BOTH TYPE O F LEGISLATION IS TO DEBAR THE EX-MEMBERS WHO ONCE PRESIDED OVER THE BENCHES OF T HE TRIBUNAL TO ARGUE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 38 BEFORE THE TRIBUNAL EITHER REPRESENTING THE ASSESSE E OR THE DEPARTMENT. BOTH THE LEGISLATION HAVE EQUAL EFFECT. THE NOTIFICATION ISSUED UNDER ARTICLE 309 OF THE CONSTITUTION HAS THE SAME LEGISLATIVE IMPACT AS THE ONE THAT WAS DONE BY THE PARLIAMENT. ACCORDING TO HIM RULE 13E HAS T HE SAME FORE AS THAT OF THE PROVISION OF SEC. 129(6) OF THE CUSTOMS ACT. AN Y DIFFERENCE IN INTERPRETATION WILL NOT BE IN LINE WITH THE VIEW E XPRESSED BY THE DELHI HIGH COURT IN THE CASE OF P.C. JAIN (SUPRA). HE VEHEMENT LY RELIED UPON THE DECISION OF P.C. JAIN. ACCORDING TO HIM THEIR LORD SHIPS OF DELHI HIGH COURT HAVE ELABORATELY DEALT WITH ALL THE CONTENTIONS THA T ARE NOW BEING TAKEN BY THE PARTIES AND THEREFORE THE LAW EXPRESSED BY THE JURISDICTIONAL HIGH COURT IN THAT CASE SHOULD BE APPLIED IN THE LARGER INTER EST OF THE INSTITUTION. 42. THE LEARNED SR. CENTRAL GOVT. COUNSEL FURTHER RELIED ON THE DECISION OF THE SUPREME COURT IN THE CASE OF STATE OF PUNJA B VS. KAILASH NATH AIR 1989 SC 558. ACCORDING TO HIM THIS DECISION CARRI ED THE SCOPE OF ARTICLE 309 EVEN BEYOND THE PERIOD AFTER RETIREMENT. THE RA TIO LAID DOWN IN THIS CASE ACCORDING TO HIM SUPPORTED THE VIEW CANVASSE D BY THE MINISTRY OF LAW & JUSTICE IN THIS REGARD. THE PROSECUTION OF AN EMPLOYEE WHO LONG BACK RETIRED WAS UPHELD BY THE APEX COURT EVEN AFTER TH E RETIREMENT AS A PART OF CONDITIONS OF SERVICE. THE LEARNED SR. CENTRAL GOVT . COUNSEL PLEADED THAT NO EMPLOYEE CAN HAVE ANY VESTED RIGHT AS TO THE TERMS AND CONDITIONS OF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 39 SERVICE. THE GOVERNMENT CAN ALWAYS VARY THE TERMS A ND CONDITIONS OF SERVICE. THE LEARNED COUNSEL HEAVILY RELIED UPON TH E DECISION OF THE DELHI HIGH COURT IN THE CASE OF P.C. JAIN WHICH ACCORDIN G TO HIM ANSWERS ALL THE POSSIBILITY IN FAVOUR OF UPHOLDING THE TYPE OF LEGI SLATION THAT IS BROUGHT OUT BY AMENDMENT TO THE RECRUITMENT RULES. 43. THE LEARNED DEPARTMENTAL REPRESENTATIVE WHO APP EARED ON BEHALF OF THE DEPARTMENT HAD NOTHING MORE TO SAY THAN WHAT H AS BEEN SUBMITTED BY THE SR. CENTRAL GOVERNMENT COUNSEL IN THE MATTER. 44. NOW WE TAKE UP THE CASES OF OTHER CLASSES OF PE RSONS WHO APPEARED AS INTERVENERS. THEY ARE ALL MEMBERS WHO RETIRED BEFOR E 3-6-2009 I.E. THE DATE OF NOTIFICATION GSR 389(E) WAS PROMULGATED. 45. SHRI S.C. TIWARI ADVOCATE POINTED OUT THAT UN LIKE SECTION 129(6) OF CUSTOMS ACT RULE 13E OF ITAT MEMBERS (RECRUITMENT & CONDITIONS OF SERVICES ) RULES 1963 DOES NOT DISENTITLE A MEMBER OF THE TRIBUNAL FROM PRACTICING BEFORE THE TRIBUNAL. RULE 13-E ACCORDIN G TO HIM DOES NOT SAY THAT MEMBER OF THE ITAT SHALL NOT BE ALLOWED TO PRACTICE BEFORE THE ITAT. IN OTHER WORDS A MEMBER WHO IS OTHERWISE ENTITLED TO PRACTICE CONTINUES TO BE ENTITLED TO PRACTICE EVEN AFTER PROMULGATION OF RUL E 13E. ACCORDING TO HIM IT IS ONLY A PROHIBITION UNDER A SERVICE RULE. IF T HERE IS ANY VIOLATION THERETO THE EMPLOYER MAY TAKE AN ACTION. HE OBJECTED TO T HE VERY APPEARANCE OF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 40 THE MINISTRY OF LAW & JUSTICE BEFORE THE SPECIAL BE NCH. ACCORDING TO HIM AFTER THE RULE 13E WAS INTRODUCED BY THE MINISTRY O F LAW AND JUSTICE IT HAS BECOME FUNCTUS OFFICIO AND THEREFORE SHOULD NOT OFF ER ANY OPINION AFTER THIS DATE. 46. SHRI TIWARI ARGUED THAT THE MEMBERS WHO HAVE RE TIED AND CEASED TO HOLD THE OFFICE AS THE MEMBERS OF THE TRIBUNAL CA NNOT BE REGULATED BY THE SAID NOTIFICATION. THE PURPOSE OF THE RECRUITMENT R ULES IS TO LAY DOWN THE CONDITIONS OF SERVICE OF THOSE PERSONS WHO ARE IN S ERVICE AND THESE CANNOT BE MADE RETROSPECTIVE SO AS TO AFFECT THE RIGHT OF PER SONS WHO ARE ALREADY RETIRED MUCH BEFORE THE PROMULGATION OF THE SAID NOTIFICATI ON. THERE CANNOT BE A CONDITION OF SERVICE WHICH WOULD BE APPLICABLE TO A PERSON ADMITTEDLY NOT IN SERVICE. IN RELATION TO A RETIRED GOVERNMENT SERVA NT RULES UNDER THE POWER CONDITIONS OF SERVICE CAN BE FRAMED ONLY IN RELAT ION TO MATTERS RELATING TO PENSION AND OTHER RETIREMENT BENEFITS. A RULE FRAM ED UNDER PROVISO TO ARTICLE 309 CANNOT APPLY TO A PERSON WHO IS NO LONG ER IN SERVICE. FOR THIS RELIANCE WAS PLACED ON THE RATIO OF DECISION OF SUP REME COURT IN THE CASE OF STATE OF PUNJAB & OTHERS VS. KAILASH NATH ETC. AIR 1989 SC 58. THE LEARNED INTERVENER FURTHER SUBMITTED THAT THE RIGHT TO PRAC TICE WAS NOT A CONDITION TO SERVICE. THIS FACT HAS BEEN ADMITTED BY THE ASG WHO APPEARED IN THE CASE OF P.C. JAIN & OTHERS VS. UNION OF INDIA & OTHERS (SUP RA). AT ANY RATE THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 41 DECISION OF THE DELHI HIGH COURT IN THE CASE OF P.C . JAIN & OTHERS IS BINDING ON THIS TRIBUNAL TO THE EXTENT IT HOLDS THAT RIGHT TO PRACTICE BEFORE THE ITAT IS NOT A CONDITION OF SERVICE. OUR ATTENTION WAS DRAW N TO PARA 34 OF THE JUDGMENT. IN FACT IN THE CASE OF P.C. JAIN (SUPRA) THEIR LORDSHIPS WERE DEALING WITH THE LEGISLATIVE PROVISION IN THE FORM OF SECTION 129(6) OF THE CUSTOMS ACT AND NOT THE CONDITION OF SERVICE. ACCO RDING TO HIM RULE 13E MUST BE IGNORED AS IT CANNOT BE MADE UNDER THE PROV ISO TO ARTICLE 309 OF THE CONSTITUTION OF INDIA. OUR ATTENTION WAS DRAWN TO T HE DECISION OF SUPREME COURT IN THE CASE OF D.R. YADAV & ANOTHER VS. R.K. SINGH & ANOTHER AIR 2003 SC 3935 WHEREIN IT WAS HELD THAT ON A PLAIN R EADING OF THE SAID PROVISION THERE CANNOT BE ANY DOUBT WHATSOEVER THA T RULES FRAMED THEE UNDER WOULD APPLY SO LONG AS A STATUTE OR STATUTORY RULES OR ANY OTHER SUBORDINATE LEGISLATION GOVERNING THE CONDITIONS OF SERVICE ARE NOT ENACTED OR MADE OR NOT OTHERWISE OPERATING IN THE FIELD. ACCOR DING TO HIM RULES MADE UNDER PROVISO TO ARTICLE 309 OF THE CONSTITUTION AR E FOR A TRANSITORY PERIOD AND THE SAME WOULD GIVE WAY TO THE SPECIAL RULES ON CE FRAMED. THE PROVISIONS OF SECTION 288 LAY DOWN THE QUALIFICATIO N OF A PERSON WHO MAY APPEAR AS AN AUTHORIZED REPRESENTATIVE OF AN ASSES SEE WHO IS ENTITLED OR REQUIRED TO ATTEND BEFORE ANY INCOME TAX AUTHORITY INCLUDING INCOME TAX APPELLATE TRIBUNAL. IT ALSO PRESCRIBES THE PERSONS WHO ARE NOT PERMITTED TO ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 42 REPRESENT THE ASSESSEE AS AN AUTHORIZED REPRESENTAT IVE. ACCORDING TO HIM BOTH QUALIFICATION AS WELL AS DISQUALIFICATION FOR PRACTICING BEFORE THE TRIBUNAL HAVE BEEN COVERED BY THE PROVISIONS OF S ECTION 288. THAT BEING SO THERE IS NO ROOM FOR FRAMING OF ANY RULES IN E XERCISE OF ANY POWER UNDER PROVISO TO ARTICLE 309 OF THE CONSTITUTION BY THE EXECUTIVES OF THE GOVERNMENT. ACCORDING TO HIM FOR INSERTION OF RUL E 13E THERE IS NO MANDATE TO THE UNION GOVERNMENT UNDER ARTICLE 309 AS LONG AS THERE IS NO SPACE PROVIDED BY SECTION 288 THERE IS NO SCOPE F OR MAKING ANY RULE 13E TO FILL THAT GAP OR SPACE. OUR ATTENTION WAS DRAWN TO THE DECISION OF PUNJAB & HARYANA HIGH COURT IN THE CASE OF SMT. JASWANT KAUR & ANOTHER VS. STATE OF HARYANA AIR 1977 (P&H) 221 AND ALSO THE DECISION OF SUPREME COURT IN THE CASE OF H.S. SRINIVASA RAGHAVACHAR & OTHERS VS. ST ATE OF KARNATAKA & OTHERS (1987) 2 SCC 692 WHEREIN IT WAS HELD THAT T HE STATE LEGISLATION OF HARYANA AND KARNATAKA COULD NOT TRENCH UPON THE RIG HT TO PRACTICE CONFERRED ON THE ADVOCATES BY THE ADVOCATES ACT WHICH IS A L AW ENACTED BY THE PARLIAMENT. IN PARA 26 OF THE DELHI HIGH COURTS DE CISION IN THE CASE OF P.C. JAIN & OTHERS (SUPRA) THEIR LORDSHIPS HAVE CLEARLY OBSERVED THAT IN CASE OF SEC. 129(6) OF THE CUSTOMS ACT THE IMPUGNED PROVIS ION IS INCORPORATED IN A CENTRAL STATUTE HENCE THE SAID RATIO OF THE AFOREM ENTIONED DECISION WOULD NOT APPLY TO THE INSTANT CASE. IN THIS CASE IF A S TATE LEGISLATURE CANNOT TRENCH ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 43 UPON THE RIGHT TO PRACTICE CONFERRED BY A LAW ENACT ED BY THE PARLIAMENT MUCH LESS A RULE FRAMED BY THE EXECUTIVE ACTING UN DER PROVISO TO ARTICLE 309 OF THE CONSTITUTION CAN CLAIM A STATUS SUPERIOR TO A STATE LEGISLATURE OR CLAIM ITSELF AS AN ACT OF PARLIAMENT. IN OTHER W ORDS THE RIGHT TO PRACTICE CONFERRED BY THE ACT BY THE PARLIAMENT CAN BE TAKE N AWAY ONLY BY ANOTHER ACT OF PARLIAMENT WHICH IS NOT THE CASE HERE. THE Q UALIFICATION OF THE INTERVENERS ACCORDING TO HIM ARE DULY SUPPORTED BY SEC. 288 OF THE INCOME TAX ACT 1961 AND SECTION 14 OF THE BAR COUNCILS AC T AND SECTION 30 OF THE ADVOCATES ACT AND THEREFORE CANNOT GET ADVERSELY AF FECTED BY RULE 13E OF THE ITAT (RECRUITMENT AND CONDITIONS OF SERVICE) RU LES 1963. 47. SHRI TIWARI FURTHER POINTED OUT THAT THE PROVIS IONS OF SECTION 129 OF THE PROVISIONS OF CUSTOMS ACT ARE IN PARI MATERIA WITH THE PROVISIONS OF SEC. 252 OF THE INCOME-TAX ACT WORD BY WORD. THEY A RE BODILY LIFTED PROVISIONS. NOTHING PREVENTED THE PARLIAMENT FROM I NSERTING IN THE PROVISIONS OF SECTION 252 WHICH IS IN PARI MATERIA WITH SECTION 129 OF THE CUSTOMS ACT. IF THAT COURSE WOULD HAVE BEEN ADOPTED BY THE PARLIAMENT IT COULD BE ARGUED THAT THE DECISION OF DELHI HIGH COU RT IN THE CASE OF P.C. JAIN & OTHERS (SUPRA) SETTLES THE MATTER IN ALL FOURS. THE PROVISIONS ARE NOT MADE THAT WAY. NOR THE PROVISIONS OF SECTION 288 OF THE I.T. ACT ARE AMENDED TO BRING IN THE DISQUALIFICATION INTO THE ACT. THE EXE CUTIVES WANTED TO INSERT ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 44 RULE 13E IN THE SERVICE CONDITIONS WHICH ACCORDING TO HIM AS ALREADY STATED EARLIER DOES NOT APPLY TO THE PERSONS WHO H AVE ALREADY RETIRED AND THERE IS A VAST DIFFERENCE IN THE LANGUAGE OF SECTI ON 129(6) AND RULE 13E INSERTED BY THE IMPUGNED NOTIFICATION. DRAWING THE SE DIFFERENCES THE LEARNED INTERVENER WANTED US TO KEEP THESE DIFFERE NCES IN MIND BEFORE DENYING THE INTERVENERS WHO ARE DULY QUALIFIED FRO M ASSISTING THE COURT IN THE MATTERS OF APPEAL ARISING UNDER THE INCOME-TAX ACT. MR. TIWARI HAS LISTED SOME OF THE NAMES OF PERSONS WHO HAVE RETIRE D AND WHO ARE PRACTICING: 1. SHRI G.C. KHANNA 24-6-1949 2. SHRI A.N. KIRPAL 23-2-1950 3. SHRI A.R. AGARWAL 1-8-1958 4. SHRI S A L NARAYANA RAO 18-7-1956 5. SHRI N.D. KARKHANIS 8-8-1961 6. SHRI S.K. AIYAR 16-1-1964 7. SHRI HARNAM SHANKAR 1-11-1976 8. SHRI J. SEN 24-5-1962 9. SHRI V.P. TIWARI 31-7-1979 10. SHRI A.M. RAO 31-3-1982 11. SHRI BISHAN LAL 30-9-1983 12. DR. S. NARAYANAN 31-7-1987 13. SHRI B.S. AHUJA 19-6-1987 14. SHRI DALIP SINGH 31-5-1981 15. SHRI D.D. VYAS 4-5-1971 16. SHRI K.C. SRIVASTAVA 19-6-1988 17. SHRI S.N. ROTHO 19-7-1988 18. SHRI V. BALASUBRAMANIAN 7-8-1980 19. SHRI K.P. BHATNAGAR 31-3-1982 20. SHRI ANAND PRAKASH 31-7-1990 21. SHRI O.P. GARG 31-12-1983 22. SHRI C.B. RATHI 30-12-1978 23. SHRI D.V. JUNAKAR 31-10-1984 24. SHRI RAJENDRA 17-1-1980 25. SHRI B. GUPTA 31-1-1987 ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 45 26. SHRI S.K. JAIN 26-10-1993 27. DR. O.N. TRIPATHI 2-2-1996. 48. THE LEARNED INTERVENER FURTHER PLEADED THAT THE RE ARE SEVERAL OTHER RETIRED MEMBERS WHO ARE IN PRACTICE AND WHOSE NAMES ARE NOT INCLUDED IN THE ABOVE LIST. IN THE CASE OF ITO VS. RAMAKRISHNA BAJAJ (1992) 43 TTJ (BOM) (SPECIAL BENCH) 400 THE RETIRED MEMBER OF TH E ITAT DR. V. BALASUBRAMANIAM IN THE SAID BENCH APPEARED NOT FO R THE ASSESSEE BUT FOR THE REVENUE . RULE FRAMED UNDER PROVISO TO ARTICLE 309 OF THE CONSTITUTION CANNOT TURN BACK THE CLOCK BY OVER 50 YEARS TO THE PREJUDICE OF THE MEMBERS WHO HAVE ACCEPTED IN PAST THE POST OF MEMBERS OF IN COME TAX APPELLATE TRIBUNAL WITH POST RETIREMENT CAREER IN THEIR MIND. ACCORDING TO HIM NOTIFICATION NO. GSR 389(E) CANNOT BE GIVEN RETROSP ECTIVE EFFECT AND IF AT ALL IT HAS TO BECOME APPLICABLE ONLY IN RELATION TO THE MEMBERS OF THE ITAT WHO ARE APPOINTED AFTER THE PUBLICATION OF NOTIFICA TION GSR 389(E). THE RETIRED MEMBERS OF THE TRIBUNAL PRACTICING BEFORE 3 -6-2009 BEFORE THE TRIBUNAL CANNOT BE DEBARRED ALL OF SUDDEN AFTER AB OUT 50 YEARS. THE NOTIFICATION GSR 389(E) ITSELF STATES THAT THEY SAM E SHALL COME INTO FORCE ON THE DATE OF THEIR PUBLICATION IN THE OFFICIAL GAZET TE MEANING THEREBY THAT THIS CANNOT HAVE A RETROSPECTIVE OPERATION IN THE MANNER PLEADED ON BEHALF OF THE MINISTRY OF LAW & JUSTICE. RELIANCE WAS PLACED ON T HE RATIO OF DECISION OF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 46 SUPREME COURT IN THE CASE OF P. MAHENDRAN VS. STATE OF KARNATAKA 1990 AIR SC 405 WHEREIN THEIR LORDSHIPS HAVE OBSERVED A S UNDER: IT IS WELL SETTLED RULE OF CONSTRUCTION THAT EVERY STATUTE OR STATUTORY RULE IS PROSPECTIVE UNLESS IT IS EXPRESSLY OR BY NECESSARY IMPLICATION MADE TO HAVE RETROSPECTIVE EFFECT. UNLESS THERE ARE WORDS IN THE STATUTE OR IN THE RULES SHOWING THE INTENTION TO AFFECT EXISTING RIGHTS THE RULE MUST BE HELD TO BE PROSPECTIVE. IF A RULE IS EXPRESSED IN LANGUAGE WHI CH IS FAIRLY CAPABLE OF EITHER INTERPRETATION IT OUGHT TO BE CONSTRUED AS P ROSPECTIVE ONLY. IN THE ABSENCE OF ANY EXPRESS PROVISION OR NECESSARY INTEN DMENT THE RULE CANNOT BE GIVEN RETROSPECTIVE EFFECT EXCEPT IN MATTER OF P ROCEDURE. 49. SHRI TIWARI POINTED OUT THAT WHEN RULES ARE FRA MED UNDER PROVISO TO ARTICLE 309 OF THE CONSTITUTION THE COURTS HAVE AL WAYS READ A SEVERE LIMITATION TO THEIR RETROSPECTIVE OPERATION. THE RE TROSPECTIVE OPERATION OF A RULE SHALL NOT PREJUDICE A PERSON ALREADY APPOINTED TO A SERVICE OR POST AND IT SHALL NOT TAKE AWAY ANY VESTED RIGHTS IN THE PERSON ALREADY APPOINTED TO A SERVICE OR POST. OUR ATTENTION WAS DRAWN TO THE RA TIO LAID DOWN BY THE SUPREME COURT IN THE CASES OF T.R. KAPUR & OTHERS V S. STATE OF HARYANA & OTHERS 1987 SCR (1) 584; D.P. SHARMA & OTHERS VS. U OI 1989 SCR (1) 791; AND R.S. AJARA & OTHERS VS. STATE OF GUJARAT & OTHE RS (1997) 2 SCC 641. 50. SHRI M.V.R. PRASAD ANOTHER INTERVENER APPEAR ED AND ARGUED ON THE SAME LINES. HE DREW OUR ATTENTION TO THE RULES OF I NTERPRETATION GIVEN AT PAGES 493 TO 505 OF INTERPRETATION OF STATUTES BY G.P. SINGH 11 TH EDITION . HE ALSO DREW OUR ATTENTION TO THE PROVISIONS OF SEC TION 288 OF THE INCOME-TAX ACT 1961 WHICH PRESCRIBE THE QUALIFICATIONS AND AL SO DISQUALIFICATIONS FROM ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 47 APPEARING AS REPRESENTATIVE BEFORE THE INCOME-TAX AUTHORITIES INCLUDING THE ITAT. ACCORDING TO HIM IT CONTAINED A PROVISION S IMILAR TO SEC. 129(6) OF THE CUSTOMS ACT IN THE FORM OF SEC. 288(3) WHICH WA S BROUGHT TO ACHIEVE THE SIMILAR OBJECT AS THESE READ AS UNDER: (3) NOTWITHSTANDING ANYTHING CONTAINED IN THIS SEC TION IF THE AUTHORIZED REPRESENTATIVE IS A PERSON FORMERLY EMPLOYED AS AN INCOME-TAX AUTHORITY NOT BELOW THE RANK OF INCOME-TAX OFFICER AND HAS R ETIED OR RESIGNED FROM SUCH EMPLOYMENT AFTER HAVING SERVED FOR NOT LESS TH AN THREE YEARS IN ANY CAPACITY UNDER THIS ACT OR UNDER THE INDIAN INCOME- TAX ACT 1922 ( 11 OF 1922) FROM THE DATE OF HIS FIRST EMPLOYMENT AS SUC H HE SHALL NOT BE ENTITLED TO REPRESENT ANY ASSESSEE FOR A PERIOD OF TWO YEARS FROM THE DATE OF HIS RETIREMENT OR RESIGNATION AS THE CASE MAY BE. 51. THIS WAS OMITTED BY THE TAXATION LAWS (AMENDME NT) ACT 1984 W.E.F. 1-10-1984. BUT HOWEVER OFFICERS BELONGING TO INDIAN REVENUE SERVICE WHO HAVE RETIRED FROM GOVERNMENT SERVICE WERE AGAIN PROHIBITED UNDER CENTRAL CIVIL SERVICE PENSION RULES FROM P RACTICING AFTER RETIREMENT UNDER RULE 11 OF THE CCS (PENSION) RULES. THE SAID RULE WAS CHALLENGED BEFORE THE CENTRAL ADMINISTRATIVE TRIBUNAL (CAT) IN OA NO. 1445 OF 1995 WHEREIN THE CAT VIDE JUDGMENT DATED 30-11-1995 HELD THAT THE BAN IMPOSED UNDER THE SAID RULE DENYING LIBERTY TO A RETIRED I NCOME TAX OFFICER THE RIGHT TO PRACTICE ANY PROFESSION WITHIN TWO YEARS A FTER RETIREMENT WAS HELD UNCONSTITUTIONAL AND INVALID LEADING TO QUASHING O F RULE 11 ITSELF. THE SAID DECISION OF THE CAT WAS CONSIDERED BY THE SUPREME C OURT IN THE CASE OF R. KAPOOR AIR 1987 SCC 415 WHEREIN THE SUPREME COU RT ITSELF HAS STRUCK ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 48 DOWN THE RULE AS UNCONSTITUTIONAL MEANING THEREBY SUCH RESTRICTIONS ON THE RETIRED EMPLOYEES WAS NOT HELD TO BE VALID AS THE S AME IS INFRINGEMENT OF ARTICLE 19 OF THE CONSTITUTION. THIS DECISION IS R ELIED UPON IN SUPPORT OF THE CONTENTION THAT AMENDMENTS OF THE SERVICE CONDITION S IN RELATION TO THE RETIRED EMPLOYEES ARE LIABLE TO BE HELD NOT VALID. THE INVALIDITY EVEN FOR A LIMITED PERIOD WAS NOT ALLOWED TO PREVAIL WHEREAS I N THE INSTANT CASE THE LEARNED INTERVENER POINTED OUT IS A LIFE LONG BAN ON RETIRED EMPLOYEE WHO IS CAUGHT UNAWARE. AGAIN OUR ATTENTION WAS DRAWN TO T HE HALSBURYS LAWS OF ENGLAND ON RETROSPECTIVE EFFECT OF A STATUTE. THE DISTINCTION WAS ALSO DRAWN BETWEEN RETROSPECTIVE AND RETROACTIVE LEGISL ATION. IT IS A CARDINAL RULE OF PRINCIPLE OF CONSTRUCTION THAT EVERY STATUTE IS PRIMA FACIE PROSPECTIVE UNLESS IT IS EXPRESSLY OR BY NECESSARY IMPLICATION MADE TO HAVE RETROSPECTIVE OPERATION. BUT THE RULE IN GENERAL IS APPLICABLE WH ERE THE OBJECT OF THE STATUTE IS TO AFFECT VESTED RIGHTS OR TO IMPOSE NEW BURDENS OR TO IMPAIR EXISTING OBLIGATIONS.. UNLESS THERE ARE WORDS IN THE STATUTE SUFFICIENT TO SHOW THE INTENTION OF THE LEGISLATURE TO AFFECT EXISTING RIG HTS IT IS DEEMED TO BE PROSPECTIVE ONLY. OUR ATTENTION WAS ALSO DRAWN TO T HE DECISION OF THE SUPREME COURT IN THE CASE OF K.S. PARIPOORNAN VS. S TATE OF KERALA AIR 1995 SC 1012 WHEREIN IT DEALS WITH THE RULES OF I NTERPRETATION IN THIS REGARD. OUR ATTENTION WAS DRAWN TO THE DECISION OF THE SUPREME COURT IN THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 49 CASE OF STATE OF U.P. VS. SHIVNARAIN AIR 2003 SC 4 9 WHEREIN ACCORDING TO HIM RELATIONSHIP OF MASTER AND SERVANT TERMINATES THE MOMENT THE SERVANT RETIRES FROM SERVICE. HE CAN NO LONGER BE GOVERNED BY ANY RECRUITMENT RULES AND THE PRESENT RULE 13E CANNOT THEREFORE REGULAT E ANYTHING IN RELATION TO THE EMPLOYEES WHO HAVE RETIRED. OUR ATTENTION WAS D RAWN TO THE RATIO OF DECISION IN THE CASE OF UDAY PRATAP SINGH VS. STAT E OF BIHAR AIR 1994 SUPL. 3 SCC 451 AND ALSO TO THE DECISION OF SUPREME COURT IN THE CASE OF U. RAGHAVENDRA VS. STATE OF KARNATAKA AIR 2006 SC 2145 . IN ALL THESE CASES IT WAS PLEADED THAT AN EXECUTIVE ORDER CANNOT OPERATE RETROSPECTIVELY TO DESTROY ANY CRYSTALLIZED/ VESTED RIGHT. OUR ATTENTION WAS ALSO DRAWN TO THE DECISION OF APEX COURT IN THE CASE OF STATE GOVT. PENSIONER S ASSOCIATION VS. STATE OF AP AIR 1986 SC 1907 WHEREIN IT WAS HELD THAT AME NDED PROVISION RELATING TO GRATUITY CANNOT APPLY TO THOSE WHO RETI RED BEFORE COMMENCEMENT OF THE RULE. OUR ATTENTION WAS ALSO DRAWN TO THE DE CISION OF APEX COURT IN THE CASE OF ERAMMA VS. VEERUPANA AIR 1966 SC 1879 (1) THAT RULE INTRODUCED IN HINDU SUCCESSION ACT CAN ONLY BE PROS PECTIVE. OUR ATTENTION WAS DRAWN TO THE DECISIONS OF SUPREME COURT IN THE CASES OF P. GANESHWAR RAO VS. STATE OF AP AIR 1988 SC 2068; AND Y.V. RANG AIAH VS. J. SRINIVASA RAO AIR 1983 SC 852(1) WHEREIN AMENDMENTS THAT ARE BROUGHT OUT LATER CANNOT BE MADE GOOD FOR VACANCIES ARISING OUT AFTER APPOINTMENT. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 50 52. SHRI K.C. SINGHAL ADVOCATE ANOTHER INTERVENER POINTED OUT THAT THE IMPUGNED NOTIFICATION NO. GSR 389E DATED 3-6-2009 I NSERTING RULE 13E IN THE ITAT MEMBERS (RECRUITMENT AND CONDITIONS OF SER VICE ) RULES 1964 HAS BEEN ISSUED BY THE PRESIDENT OF INDIA UNDER AR TICLE 309 OF THE CONSTITUTION OF INDIA. SUCH POWERS UNDER THE AFORES AID ARTICLE CAN BE EXERCISED EITHER FOR MAKING RECRUITMENT RULES OR FO R PROVIDING CONDITIONS OF SERVICE IN RESPECT OF THE PERSONS APPOINTED IN CONN ECTION WITH THE AFFAIRS OF THE UNION OF INDIA OR THE STATE. THEREFORE ANY RUL E MADE THEREIN SHOULD BE IN CONFORMITY WITH THE PROVISIONS OF ARTICLE 309 OF T HE CONSTITUTION OF INDIA. IT WAS CONCEDED BY THE LAW MINISTRY BEFORE THE DELHI H IGH COURT IN THE CASE OF P.C. JAIN & OTHERS (SUPRA) THAT THE AMENDMENT B ROUGHT IN SEC. 129(6) OF THE CUSTOMS ACT WAS NOT A CONDITION OF SERVICE. IF THE AMENDMENT BROUGHT IN THAT ACT WAS NOT A CONDITION OF SERVICE IT IS STRA NGE THAT THE MINISTRY HAS TAKEN A STAND THAT RULE 13E OF THE ITAT MEMBERS (RE CRUITMENT AND CONDITIONS OF SERVICE) RULES 1963 FALLS WITHIN THE SCOPE OF WORDS CONDITIONS OF SERVICE. ACCORDING TO HIM THE RECR UITMENT RULES CAN BE MADE APPLICABLE TO THE PERSONS WHO ARE TO BE RECRUITED T HEREAFTER AND CANNOT BE APPLIED TO THE PERSONS WHO HAVE ALREADY RETIRED FRO M SERVICE BEFORE THE DATE OF THE IMPUGNED NOTIFICATION. FOR THESE REASONS THE ADDL. SOLICITOR GENERAL WHO ARGUED THE CASE BEFORE THE DELHI HIGH COURT IN THE CASE OF P.C. JAIN ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 51 (SUPRA) CONCEDED THAT BAR TO PRACTICE IMPOSED ON E X-MEMBERS WAS NOT A CONDITION OF SERVICE. THEREFORE THAT BEING THE POS ITION IT CANNOT BE PERMITTED TO ARGUE HERE THAT SUCH A RULE IS A CONDI TION OF SERVICE WHEN IT CAME TO THE IDENTICAL PROVISIONS IN THE CASE OF ITA T. ACCORDING TO HIM THE EXPRESSION CONDITION OF SERVICE ITSELF WAS CONSTR UED BY THE APEX COURT IN THE CASE OF STATE OF PUNJAB VS. KAILASH NATH ( SUPR A) (AIR 1988 SC 448) CLASSIFYING THE SERVICES FALLING WITHIN THE PURVIEW OF CONDITION OF SERVICE ( AS REPRODUCED IN EARLIER PART OF THE ORDER). IN VIE W OF THE ABOVE JUDGMENT IT CANNOT BE SAID THAT THE BAR TO PRACTICE FALLS WITHI N THE TERM CONDITION OF SERVICE AS IT IS NOT IN CONNECTION WITH ANY OF TH E ITEMS SPELT OUT AS A CONDITION OF SERVICE EXPLAINED BY APEX COURT IN TH E CASE OF KAILASH NATH (SUPRA). . 53. THE LEARNED INTERVENER SUBMITTED THAT RULE 13E HAS BEEN INSERTED ON THE STATUTE WITH EFFECT FROM THE DATE OF PUBLICATIO N I.E. 3-6-2009. ADMITTEDLY ALL THESE PERSONS WHO ARGUED AS INTERVENERS HAVE RE TIRED PRIOR TO THIS DATE. IT CANNOT BE PRESUMED THAT SUCH RULE WOULD APPLY TO TH E PERSONS WHO HAVE ALREADY RETIED. IN FACT ACCORDING TO HIM UNLESS S UCH RULE WAS THERE AT THE TIME OF RECRUITMENT THE SAME CANNOT BE APPLIED AT THE TIME OF RETIREMENT. 54. HE POINTED OUT THAT A PROVISION CAN BE SAID TO BE RETROSPECTIVE IF IT IS DECLARATORY OF LAW. IN THIS CASE NEITHER RULE 13E EXPRESSLY STATES IT TO BE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 52 RETROSPECTIVE NOR SUCH RULE CAN BE CONSIDERED AS DE CLARATORY OF LAW. HENCE BY NO LOGIC SUCH RULE CAN BE SAID TO BE ON THE STA TUTE WHEN THE INTERVENERS WERE IN SERVICE. HENCE THIS RULE CANNOT BE APPLIED TO PERSONS WHO RETIED PRIOR TO 3-6-2009. EVEN ASSUMING FOR THE SAKE OF A RGUMENT THOUGH NOT ADMITTED THE LEARNED INTERVENER PLEADED THAT RULE 13E IS RETROSPECTIVE IN NATURE IT CANNOT TAKE AWAY THE ACCRUED OR VESTED R IGHTS ACQUIRED BEFORE 3-6- 2009 AS HELD BY THE SUPREME COURT IN THE CASES OF P .D. AGGARWAL & OTHERS VS. STATE OF U.P. AIR 1987 SC 1676; AND CHAIRMAN R AILWAY BOARD & OTHERS VS. R. RANGADHAMAIAH & OTHERS AIR 1997 SC 38 28 (CONSTITUTION BENCH). ACCORDINGLY IT IS THE DUTY OF THE COURT OF THE TRIBUNAL TO INTERPRET THE SERVICE RULES IN THE MANNER THAT THE INTERPRETA TION DOES NOT TAKE AWAY THE VESTED RIGHTS ACQUIRED BY ANY PUBLIC OFFICER. ACCOR DING TO HIM HE WAS CARRYING ON THE LEGAL PROFESSION SINCE 1969 AND AS AN ADVOCATE AND APPEARING BEFORE THE ITAT TILL 1994 WHEN HE JOINED THE SERVICE AS JUDICIAL MEMBER OF THE ITAT. ACCORDING TO HIM HE HAD A VEST ED RIGHT TO PRACTICE BEFORE THE TRIBUNAL BY VIRTUE OF SECTION 288 OF THE I.T. ACT 1961 AND SECTION 14 OF THE BAR COUNCIL ACT 1926 TILL JOINING THE SER VICE WHICH REMAINED UNDER SUSPENSION TILL HIS RETIREMENT AND AGAIN GOT REVIVE D IMMEDIATELY AFTER THE DATE OF RETIREMENT. ACCORDING TO HIM HE HAD A VES TED RIGHT TO PRACTICE BEFORE THE ITAT BEFORE THE PUBLICATION OF THE NOTIF ICATION. ACCORDING TO HIM ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 53 THEREFORE THE SAID NOTIFICATION CANNOT BE APPLIED IN SUCH A MANNER SO AS TO TAKE AWAY SUCH EXISTING RIGHT. IT WAS ALSO PLEADED BY THE INTERVENER THAT AFTER THE DATE OF RETIREMENT HE CEASED TO BE THE V ICE PRESIDENT OR THE MEMBER OF THE ITAT AND THEREFORE RULES OR CONDITIO NS OF SERVICE APPLICABLE TO THE SERVING EMPLOYEE CANNOT BE APPLIED TO PERSON S NO LONGER IN SERVICE. 55. SHRI KESHAV PRASAD ADVOCATE FAIRLY ADMITTED T HAT AS REGARDS THE MAIN CONTENTION IS CONCERNED HE IS WITH ALL OTHER INTERVENERS. HE DREW OUR ATTENTION TO THE DECISION OF DELHI HIGH COURT IN TH E CASE OF P.C. JAIN (SUPRA) AND SUBMITTED THAT IN THE AFORESAID DECISION A BRIE F HISTORY LEADING TO THE INSERTION OF SUB-SECTION (6) TO SECTION 129 OF THE CUSTOMS ACT HAS BEEN GIVEN. IN THE YEAR 1986 THE PARLIAMENT ENACTED THE CUSTOMS AND EXCISE REVENUE APPELLATE TRIBUNAL ACT (CERAT ACT IN SH ORT) FOR SETTING UP A TRIBUNAL IN CONSONANCE WITH THE POWER CONTAINED IN ARTICLE 323B OF THE CONSTITUTION OF INDIA. SECTION 11(C) OF THE SAID AC T BARRED THE PRESIDENT VICE PRESIDENT OR THE MEMBERS FROM APPEARING PLEAD ING BEFORE THE SAID TRIBUNAL OR CEGAT AFTER THEIR RETIREMENT. HOWEVER DUE TO THE DECISION OF APEX COURT IN THE CASE OF L. CHANDRAKUMAR VS. UNION OF INDIA (1997) 3 SCC 261 THE SAID CERAT ACT WAS REPEALED IN 2004. S INCE THEN THE ISSUE WAS BEING DISCUSSED AT THE HIGHEST LEVEL AND SUB-SE CTION (6) WHICH WAS INSERTED BY FINANCE ACT 2007 IS THE RESULT OF SUC H DELIBERATIONS. THE HIGH ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 54 COURT TOOK NOTE OF THESE DEVELOPMENTS WHICH STARTED IN 1986. IT WAS POINTED OUT BEFORE US THAT THE PROVISIONS OF SECTION 129 O F THE CUSTOMS ACT AND SECTION 252 OF THE INCOME-TAX ACT ARE ALMOST SIMILA R. THE PARLIAMENT TOOK A CONSCIOUS DECISION TO INSERT SUB-SECTION (6) TO SEC TION 129 OF THE CUSTOMS ACT BUT DID NOT INSERT SIMILAR PROVISION IN SECTIO N 252 OF THE INCOME-TAX ACT. NO SUCH PROVISION HAS BEEN BROUGHT IN THE INCO ME-TAX ACT TILL DATE MEANING THEREBY THE PARLIAMENT ITSELF WANTED THE D IFFERENCE IN BOTH THE ACTS TO CONTINUE. THE REASON IS OBVIOUS ACCORDING TO HI M. THE PROVISION OF SUB- SECTION (3) TO SECTION 288 EXISTED IN THE INCOME-TA X ACT. AS PER THE SAID SUB- SECTION THE RETIRED INCOME TAX OFFICIALS WERE NOT PERMITTED TO APPEAR BEFORE INCOME TAX AUTHORITY INCLUDING THE ITAT UPTO TWO YE ARS FROM THE DATE OF THEIR RETIREMENT. THE VALIDITY OF THE SAID SUB-SUBS ECTION WAS CHALLENGED IN THE COURT AND THE HONBLE PUNJAB & HARYANA HIGH COU RT IN THE CASE OF KULWANT SINGH 75 ITR 99 HELD THE SAID PROVISION TO BE CONSTITUTIONALLY VALID. STILL THE PARLIAMENT IN ITS OWN WISDOM DELET ED SUB-SECTION (3) FROM THE STATUTE BY TAXATION LAWS AMENDMENT ACT 1984. THER EAFTER RULE 11 WAS INSERTED IN THE CENTRAL CIVIL SERVICES (PENSION) RU LES 1972 IN 1984. AS PER THAT RULE THE RETIRED INCOME-TAX OFFICIALS COULD N OT SET UP PRACTICE FOR 3 YEARS. THIS RULE WAS HELD TO BE ULTRAVIRES BY THE APEX COURT AND PRESENTLY THIS RULE IS NON-EXISTENT. ACCORDING TO HIM THE AM ENDMENTS THAT ARE MADE IN ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 55 THE CONDITIONS OF SERVICE IN THE LIGHT OF THE PRIN CIPLE LAID DOWN BY THE APEX COURT IN THE CASE OF KESHVAN MADHVAN MENON 1951 AIR (SC) 128 CAN ONLY BE PROSPECTIVE IN NATURE. THE LAW MINISTRY IN THEIR AFFIDAVIT HAVE CONCEDED THE RULE TO BE PROSPECTIVE BUT THEY ALSO STATED T HAT IT WOULD BE ILLOGICAL TO MAKE DISTINCTION BETWEEN THE MEMBERS WHO RETIRED PR IOR TO THIS DATE OR AFTER THE DATE OF NOTIFICATION FORGETTING THE FACT THAT NOTIFICATION ITSELF IS DECLARED TO BE PROSPECTIVE. ARTICLE 309 ACCORDING TO HIM H AS TWO LIMBS- ONE RELATING TO RECRUITMENT AND THE OTHER RELATING TO CONDITIONS OF SERVICE. THE RULES RELATING TO RECRUITMENT CAN ONLY APPLY TO THOSE PE RSONS WHO ARE SERVING THE UNION ON THE DATE OF THE NOTIFICATION OR WHO WOULD SERVE THE UNION OR THE STATE IN FUTURE. IT CANNOT APPLY TO PERSONS WHO ARE NOT SERVING ON THAT DATE. ACCORDING TO HIM NO RULE CAN BE MADE UNDER ARTICLE 309 IN RELATION TO PERSONS WHO HAVE ALREADY RETIRED FROM SERVICE. THE PROVISO OF THIS ARTICLE ACCORDING TO HIM IS NOTHING BUT DELEGATION OF POWE RS OF RULE MAKING TO SUBORDINATES INSTEAD OF BEING MADE BY THE APPROPRI ATE LEGISLATURE. FORCIBLY IT IS PLEADED THAT THE SAID RULE CANNOT BE MADE TO THOSE PERSONS WHO HAVE ALREADY RETIRED. ANY AMENDMENT TO THE RULES OF RECR UITMENT CAN BE MADE TO THE PERSONS WHO ARE JOINING THE SERVICE AFTER THAT DATE. AS REGARDS THE CONDITIONS OF SERVICE IT CAN BE FOR THE PERSONS WH O ARE SERVING THE INSTITUTION OR WHO WILL BE SERVING IN FUTURE BUT DEFINITELY NO T TO THE PERSONS WHO HAVE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 56 ALREADY RETIRED. HE GAVE AN EXAMPLE. RULE 3(2) OF T HE ITAT MEMBERS (RECRUITMENT & CONDITIONS OF SERVICE) RULES 1963 PRESCRIBES THE QUALIFICATION FOR APPOINTMENT AS AN ACCOUNTANT MEMB ER. CLAUSE (II) OF SUB- RULE (2) OF THE ORIGINAL RULE HAD PROVIDED THAT THE PERSON WHO HAD WORKED AS AN ASSTT. COMMISSIONER OF INCOME-TAX FOR THREE YEAR S WAS ELIGIBLE FOR APPOINTMENT AS MEMBER. IT WAS AMENDED BY AMENDMENT IN THE ABOVE RULES AND IT PROVIDED THAT PERSONS WHO HAVE WORKED AS COM MISSIONERS OF INCOME TAX FOR 3 YEARS WERE ELIGIBLE FOR APPOINTMENT AS AC COUNTANT MEMBERS. DOES IT MEAN THAT THOSE PERSONS WHO WERE WORKING AS MEMB ERS SELECTED ON THE BASIS OF EARLIER ELIGIBILITY WOULD CEASE TO BE MEMB ERS? BUT IT DID NOT HAPPEN MEANING THEREBY SUCH AMENDMENT AS REGARDS THE REC RUITMENT RULES CAN BE MADE TO THE APPOINTMENTS MADE AFTERWARDS. AS REGARD S THE MEANING OF TERM CONDITIONS OF SERVICE HE RELIED UPON ELABORATE DISCUSSIONS IN THE DECISIONS OF APEX COURT IN THE CASES OF STATE OF P UNJAB VS. KAILASHNATH AIR 1989 SC 558 AND STATE OF MADHYA PRADESH VS. SHA RDUL SINGH 3 SCR 303. 56. SHRI T.N. CHOPRA ADVOCATE PLEADED THAT NOTIFIC ATION ISSUED BY THE LAW MINISTRY BEING IN THE NATURE OF SUBORDINATE LE GISLATION CANNOT CONCEIVABLY AMEND MODIFY OR OVERRIDE THE STATUTORY PROVISION OF SECTION 288 OF THE ACT. THE NOTIFICATION IS OUTSIDE THE DOM AIN OF THE INCOME TAX ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 57 ACT AND MERELY RELATES TO ADMINISTRATIVE AND DISCIP LINARY JURISDICTION OF THE LAW MINISTRY AND CANNOT INTERFERE WITH THE JUDICIAL FUNCTIONS OF THE TRIBUNAL. OUR ATTENTION WAS DRAWN TO THE DECISION O F THE SUPREME COURT IN THE CASE OF ITAT VS. V.K. AGARWAL 235 ITR 175 (SC) . OUR ATTENTION WAS ALSO DRAWN TO THE DECISION OF DELHI HIGH COURT IN T HE CASE OF CHAIRMAN CBDT VS. S. MALHOTRA 128 ITR 543 (DEL.) WHEREIN IT WAS HELD THAT PROVISION TO DEBAR AN INCOME-TAX PRACTITIONER CAN O NLY BE PROSPECTIVE IN CHARACTER WHERE THE PERSON COMMITS AN ACT OR DEFAUL T COMPLAINED OF AFTER THE AMENDMENT HAS COME INTO FORCE AND NOT BEFORE. IT WA S ALSO PLEADED BY SHRI T.N. CHOPRA THAT NOTIFICATION IMPOSES A LIFE BAN ON THE RETIRED MEMBERS FOR PRACTICE BEFORE THE TRIBUNAL WHEREAS SECTION 288 O F THE I.T. ACT AS WELL AS SECTION 30 OF THE ADVOCATES ACT DECLARE THAT EVERY ADVOCATE WHOSE NAME IS ENTERED IN THEIR ROLL SHALL BE ENTITLED AS A MATTE R OF RIGHT TO PRACTICE IN ALL THE COURTS AND TRIBUNAL. THEREFORE THE LAW MINISTRY IS NOT COMPETENT TO MAKE RULE REPUGNANT THERETO. OUR ATTENTION WAS ALSO DRAW N TO THE DECISION OF SUPREME COURT IN THE CASE OF LEGAL AIR & ADVICE VS . BAR COUNCIL OF INDIA (1995) 82 AIR 691. SPECIAL EMPHASIS WAS PLACED TO T HE DECISION OF SUPREME COURT IN THE CASE OF KAILASH NATH (SUPRA) AND ACCO RDING TO HIM THE PRESENT RULE 13E IS OUTSIDE THE SCOPE OF ARTICLE 309 OF THE CONSTITUTION. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 58 57. SHRI PRAKASH NARAIN ADVOCATE RELIED UPON THE WRITTEN SUBMISSIONS LARGELY REITERATING ON THE ARGUMENTS OF THE OTHER INTERVENERS. 58. THE LEARNED SR. CENTRAL GOVT. COUNSEL SHRI A.K. BHARDWAJ IN RELATION TO THE MEMBERS WHO RETIED BEFORE 3-6-2009 VEHEMENT LY CONTENDED THAT IN THE LIGHT OF THE DECISION OF THE DELHI HIGH COURT I N THE CASE OF P.C. JAIN (SUPRA) TO WHICH JURISDICTIONALLY THIS BENCH OF TH E ITAT FALLS IS BINDING UPON IT. HE SUBMITTED THAT THE CONTENTIONS OF SEVE RAL INTERVENERS INCLUDING THE ONE WHO RETIRED HAVE ALL BEEN ANSWERED BY THE DELHI HIGH COURT AND THEREFORE THE PRINCIPLE LAID DOWN THEREIN IS APPLIC ABLE RETROSPECTIVELY TO THE MEMBERS WHO HAVE ALREADY RETIRED. RELIANCE WAS PLAC ED ON THE DECISION OF SUPREME COURT IN THE CASE OF STATE OF PUNJAB VS. K AILASH NATH (SUPRA) AND CONTENDED THAT IN THE AFORESAID CASE THE APEX COURT APPROVED THE PROSECUTION OF A GOVERNMENT SERVANT FOR AN ACT COMM ITTED WHILE IN SERVICE EVEN AFTER THE RETIREMENT MEANING THEREBY THE RET IRED EMPLOYEES CAN BE SUBJECTED TO THE CONDITIONS OF SERVICE LIKE THE ONE AS IS BEING MADE OUT IN THE PRESENT NOTIFICATION AND SUCH CONDITIONS OF SERVICE AS THE APEX COURT ITSELF HAS HELD ARE BINDING UPON THE RETIRED GOVERNMENT E MPLOYEES. ACCORDING TO HIM THE RATIO OF THE SUPREME COURTS DECISION CLEA RLY SUPPORTS THE VIEW TAKEN BY THE MINISTRY OF LAW & JUSTICE AND ON OTHER POINTS HE RELIED UPON THE DETAILED AFFIDAVIT FILED BY THE MINISTRY IN SU PPORT OF THE STAND TAKEN BY ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 59 THE MINISTRY. HE VEHEMENTLY ARGUED THAT THE ITAT ME MBERS SHOULD BE GUIDED BY THE PRINCIPLE OF PURPOSIVE INTERPRETATION AS WAS DONE BY THE DELHI HIGH COURT WHILE CONSTRUING THE IDENTICAL PROVISION S IN THE CUSTOMS ACT THE PURPOSE OF BOTH THE PIECES OF THE LEGISLATION IS T HE SAME AND THAT BEING TO MAINTAIN THE INDEPENDENCE OF THE JUDICIARY AND TO S AVE THE REPUTATION OF THE INSTITUTION FREE FROM CHARGE OF BIAS. ON ACCOUNT OF EX-MEMBERS WHO ONCE PRESIDED OVER THE JUDICIAL BODY ARE ARGUING THEIR CASES BEFORE IT THE CHARGE OF BIAS CAN ALWAYS BE RAISED. RATHER IT IS ALWAYS PRESUMED. THE JUDICIAL BODY SHOULD BE FREE FROM SUCH CHARGE ON ITS REPUTAT ION. THAT ACCORDING TO HIM SHOULD BE TAKEN NOTE OF AND THE MEMBERS OF THE ITAT WHO RETIED LONG BACK SHOULD THEREFORE NOT PRACTICE BEFORE THE ITA T AFTER THEIR RETIREMENT FROM NOW ONWARDS. AS REGARDS THE CONTENTION THAT I T APPLIES ONLY TO THE MEMBERS WHO ARE RECRUITED AFTER THE ISSUANCE OF NOT IFICATION HE VEHEMENTLY ARGUED THAT IT WILL BE AGAINST THE PRINCIPLE LAID D OWN BY THE DELHI HIGH COURT IN THE CASE OF P.C. JAIN (SUPRA). THE LEARNED SR. C ENTRAL GOVERNMENT COUNSEL HEAVILY RELIED UPON THE DECISION OF THE APEX COURT IN THE CASE OF VISHNU NARAIN MISHRA VS. STATE OF U.P. AIR 1965 SC 1567 TO CONTEND THAT THE PROVISION LIKE THE ONE MADE IN RULE 13E IS APPLICA BLE TO ALL THE PERSONS WHO HAVE EVEN RETIRED PRIOR TO THE COMING INTO FORCE OF THE SAID NOTIFICATION. THIS DECISION IS OF 5 MEMBERS BENCH OF THE APEX COURT AN D IS BINDING ON THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 60 ITAT AND THEREFORE THE RATIO LAID DOWN BY THE DELHI HIGH COURT IN THE CASE OF P.C. JAIN (SUPRA) IS APPLICABLE TO ALL THE RETIR ED PEOPLE WHETHER THEY HAVE ENTERED INTO SERVICE PRIOR TO 3-6-2009 OR AFTER 3-6 -2009. SO THE PLEA THAT IT APPLIES ONLY TO THOSE PERSONS WHO ARE RECRUITED AFT ER 3-6-2009 SHOULD BE REJECTED IN THE LIGHT OF THE RATIO LAID DOWN BY THE SUPREME COURT IN THE AFORESAID CASE. 59. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE ASSESSEE INTERVENERS AS ALSO THE SR. CENTR AL GOVERNMENT COUNSEL AND GONE THROUGH THE CASE LAWS WHICH HAVE BEEN RELIED U PON BY THE PARTIES AND DEAL WITH THE SUBMISSIONS AND ISSUES AS UNDER: 60. AS REGARDS ARGUMENTS OF SOME OF THE INTERVENERS THAT THE MINISTRY OF LAW & JUSTICE HAS NO LOCUS STANDI IN THE MATTER AND THEREFORE THEY SHOULD NOT BE PERMITTED TO ARGUE ON BEHALF OF THE GOVERNM ENT ACCORDING TO US CANNOT BE ACCEPTED. THE NOTICE WAS ISSUED BY THE SP ECIAL BENCH TO THE MINISTRY OF LAW & JUSTICE AND THE MINISTRY HAS IN FACT ASSISTED THE BENCH BY FILING THE AFFIDAVIT AND HAS ALSO DIRECTED THE APPEARANCE OF THE SR. CENTRAL GOVERNMENT COUNSEL TO PLEAD ITS CASE WE APPRECIATE THEIR CONCERN AND ASSISTANCE IN THE MATTER. IN OUR VIEW THE TRIBUNAL IS ENTITLED TO HEAR THE MINISTRY OF LAW & JUSTICE WHO HAS IN FACT ISSUED T HE NOTIFICATION. ULTIMATELY THE DECISION HAS TO BE OF THE BENCH AND WE ARE NOT GUIDED BY THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 61 CONTENTIONS OF THE MINISTRY OF LAW & JUSTICE AS MAD E OUT BY THEIR COUNSEL OR IN THEIR AFFIDAVIT. WE WOULD DEFINITELY LOOK INTO ALL THESE CONTENTIONS IN THE LIGHT OF LAW THAT PREVAILS ON THE ISSUE. THE SPIRIT WITH WHICH THEY APPEARED TO ASSIST THE BENCH IS APPRECIATED AND THE OBJECTIONS PUT UP IN THIS REGARD BY SOME OF THE INTERVENERS ARE THEREFORE REJECTED A S UNTENABLE. AFTER ALL IT MUST NOT BE FORGOTTEN THAT THE TRIBUNAL IN ITS JUDI CIAL PROCEEDINGS ARE ENTITLED TO DRAW ASSISTANCE FROM ALL PERSONS. IT CANNOT BE S AID THAT MINISTRY OF LAW & JUSTICE BECOMES STRANGER AFTER THE ISSUANCE OF NOT IFICATION. 61. IN PARA 21 OF THE DECISION OF HONBLE DELHI HIG H COURT IN THE CASE OF P.C. JAIN & OTHERS (SUPRA) THE VALIDITY OF THE PRO VISION OF SECTION 129(6) OF THE CUSTOMS ACT WERE OBJECTED ON THE CHARGE OF VIO LATION OF ARTICLE 14 19(1)(G) AND 21 OF THE CONSTITUTION. THE SAID LEGI SLATION WAS CHALLENGED ON BEING DISCRIMINATORY INASMUCH AS THE MEMBERS OF OTH ER TRIBUNALS SUCH AS THE INCOME TAX APPELLATE TRIBUNAL AND THE APPELLATE TRIBUNAL FOR FOREIGN EXCHANGE ARE NOT BARRED FROM APPEARING ACTING OR PLEADING BEFORE TRIBUNALS OF WHICH THEY WERE ONCE MEMBERS. THE HIGH COURT SPECIFICALLY DEALT WITH THE ISSUE IN PARA 24 OF ITS JUDGMENT A GAIN ON THE GROUND THAT SUCH CLEAR DISCRIMINATION WAS UNTENABLE. IN THE OPI NION OF THE HIGH COURT THE STEP TAKEN IN AMENDING THE CUSTOMS ACT WAS RE FORMATORY AND NOT DISCRIMINATORY AS CONTENDED BY THE PETITIONER. IT WAS ALSO BASED ON THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 62 RECOMMENDATION OF THE PRESIDENT OF THE CESTAT. IN THE OPINION OF THE HIGH COURT A BAR HAS BEEN MADE IN THE PROVISION IN RESPECT OF SOME TRIBUNALS SUCH AS CESTAT AND CAT LEADING TO THEIR CONCLUSION THAT THE INTENDED PROVISIONS WERE NOT DISCRIMINATORY. THE HONBLE HIG H COURT ALSO APPRECIATED THE FACT THAT ADDL. SOLICITOR GENERAL (ASG IN SHORT) WHO BROUGHT TO THEIR NOTICE AN INTERDEPARTMENTAL LETT ER DATED 20-09- 2007 EXCHANGED BETWEEN THE MINISTRY OF LAW & JUSTIC E DEPARTMENT OF LEGAL AFFAIRS AND THE DEPARTMENT OF REVENUE WHICH SUGGESTED THAT THE GOVERNMENT WAS IN PRINCIPLE AGREED THAT STEPS SHOUL D BE INITIATED TO BRING ABOUT A SUITABLE AMENDMENT SO THAT SIMILAR BAR IS I NCORPORATED IN THE INCOME TAX ACT IN RESPECT OF MEMBERS OF THE INCOME APPELL ATE TRIBUNAL. IN FACT THE ASG SUBMITTED THAT THIS WAS AN ASPECT WHICH WAS PEN DING FOR CONSIDERATION SINCE 1986 AND FOR ONE REASON OR THE OTHER IT COU LD NOT BE BROUGHT ON THE STATUTE BOOK. THE ASG CONTENDED THAT THE GOVERNM ENT WAS CONTEMPLATING SUCH LIKE AMENDMENT IN OTHER PARI MATERIA STATUTES IN CONSONANCE WITH THE PROVISIONS OF SECTION 129(6) OF THE CUSTOMS ACT WH ICH BARRED THE MEMBERS AND THE CHAIRMAN OF SUCH TRIBUNALS FROM APPEARING ACTING OR PLEADING BEFORE THE TRIBUNAL OF WHICH A PERSON SERVED AS A CHAIRMAN OR A MEMBER. WE HAVE KEPT THIS BACKGROUND IN OUR MIND. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 63 62. SOME OF INTERVENERS QUESTIONED THE CHARGE/ FEAR OF BIAS UPON THE ITAT. ACCORDING TO THEM IN THE CASE OF P.C. JAIN (S UPRA) PRESIDENT OF CESTAT HIMSELF PLACED ON RECORD THE CHARGE AGAINST ITS FORMER MEMBERS AND RAISED SUCH ISSUES BEFORE THE MINISTRY. ALTHOUG H WE ARE NOT AWARE OF ANY SUCH MATERIAL WITH REGARD TO ITAT BUT THAT HARD LY IS MATERIAL/ SIGNIFICANT. STILL THE EXECUTIVE/ PARLIAMENT CAN TA KE COGNIZANCE OF PUBLIC PERCEPTION OF THE MATTER AND LEGISLATE SO AS TO TA KE THE INSTITUTION OUT OF IT. THEY HAVE QUESTIONED HOW THE BIAS BE RAISED UPON PE RSONS WHO HAVE RETIRED LONG LONG BACK FOR ACCORDING TO THEM THE NEW GENER ATION OF MEMBERS MAY NOT EVEN KNOW THEM BY PERSON/ FACE. THEY FELT THE I MAGINATION OF THE MINISTRY IS TOO MUCH THEORETICAL AND BASED ON HEAR SAY IS NOT ON ANY SUBSTANCE OR MATERIAL. WE DO NOT AGREE WITH THE CON TENTION OF THE INTERVENERS THAT LEGISLATION CANNOT BE MADE ON THE PUBLIC PERCE PTION OF BIAS. THE LEGISLATION CAN PERHAPS BE MADE EVEN TO PREVENT THE INSTITUTION FROM GETTING INTO A CLOUD. AFTER ALL IT IS THE DUTY OF THE GOVER NMENT TO PROTECT THE JUDICIAL BODY FROM BEING CHARGED WITH SUCH IMPRESSIONS. BUT THE QUESTION THAT ARISES NOW IS AS TO WHETHER THE NOTIFICATION THAT IS BEFO RE US CAN BE INTERPRETED WHICH IS ON THE BASIS OF SOME HEARSAY GOSSIPS OR M EDIA HYPE. DEFINITELY NOT. THE INTERPRETATION IN OUR VIEW CANNOT BE SOLELY B ASED UPON THESE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 64 CONSIDERATIONS BUT HAS TO BE ON THE SOLID PRINCIPL E OF LAW AS INTERPRETED BY THE SUPREME COURT AND DIFFERENT HIGH COURTS. 63. NOW IMPORTANT OFFSHOOTS OF THE PROVISIONS OF R ULE 13E ARE BEING DISCUSSED. THE FIRST OFFSHOOT WOULD BE WHETHER IT A PPLIES TO THE MEMBERS WHO RESIGNED FROM A TEMPORARY POST DURING PROBATIO N PERIOD. WE HAVE ALREADY EXTRACTED THE TERMS OF OFFER ISSUED TO THE INTERVENERS WHICH IS MORE OR LESS THE SAME. THE POST IS STATED TO BE TEMPORA RY FOR A PARTICULAR PERIOD STATED THEREIN AND ALSO THE POST ITSELF TREATED AS PROBATIONARY WITH AN OPTION THAT THE GOVERNMENT MAY EXTEND THE PROBATION ON ITS DISCRETION. EXCEPT IN THE CASE OF SHRI Y.K. KAPOOR IN ALL OTHER CASES OF THE INTERVENERS AT SL. NO. 1 TO 4 MENTIONED IN THE CAPTION RESIGNED FROM THEIR SERVICE MUCH BEFORE THEIR CONFIRMATION. IN CASE OF DR. RAKESH GUPTA THE OFFE R WAS WITH FURTHER CONDITION SUBJECT TO THE FINAL ORDERS IN CERTAIN C IVIL WRIT PETITIONS PENDING BEFORE THE HIGH COURT. THAT MEANS THE OFFER OF APP OINTMENT GIVEN IN ALL THESE CASES WAS PURELY FOR A TEMPORARY POST AND TH E POST ITSELF WAS SUBJECT TO PROBATIONARY PERIOD OF TWO YEARS. 64. THE HONBLE SUPREME COURT IN THE CASE OF PUSHOT AM LAL DHINGRA VS. UOI AIR 1958 SC 36 HAVE EXPLAINED THE TERMS TEM PORARY POST AS WELL AS PROBATION AS UNDER: 17. ARTICLES 310 AND 311 ARE TWO OF THE ARTICLES W HICH HAVE BEEN GROUPED UNDER THE HEADING SERVICES IN CHAPTER I OF PART X IV WHICH DEALS WITH THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 65 SERVICES UNDER THE UNION AND EH SATES. IT IS WELL KNOWN HAT THERE ARE DIFFERENT SPECIES OF GOVERNMENT SERVICES. IN THE AB SENCE OF A CONTRACT TO THE CONTRARY THE TERMS OF EMPLOYMENT OF PERSONS IN DIFFERENT SERVICES ARE GOVERNED BY RULES MADE BY THE APPROPRIATE AUTHORITI ES TO WHICH REFERENCE WILL HEREAFTER BE MADE. THE STRENGTH OF A SERVICE O R A PAT OF A SERVICE SANCTIONED AS A SEPARATE UNIT IS IN THE FUNDAMENTS RULES S. III CH. II R. 9(4) CALLED THE CADRE. EACH CADRE CONSISTS OF A CE RTAIN NUMBER OF POSTS. ACCORDING TO R. 9(22) OF THE FUNDAMENTAL RULES A P ERMANENT POST MEANS A POST CARRYING A DEFINITE RATE OF PAY SANCTIONED WIT HOUT LIMIT OF TIME. IN EACH CADRE THERE MAY BE AND OFTEN IS A HIERARCHY OF RANKS. DUE TO RUSH OF BUSINESS OR OTHER EXIGENCIES SOME TEMPORARY POSTS ARE OFTEN CREATED. A TEMPORARY POST IS DEFINED IN R. 9(3) TO MEAN A POST CARRYING A DEFINITE RATE OF PAY SANCTIONED FOR A LIMITED TIME. THESE TEMPORA RY POSTS ARE VERY OFTEN OUTSIDE THE CADRE AND ARE USUALLY FOR ONE YEAR AND ARE RENEWED FROM YEAR TO YEAR ALTHOUGH SOME OF THEM MAY BE CREATED FOR A CERTAIN SPECIFIED PERIOD. THE CONDITIONS OF SERVICE OF A GOVERNMENT S ERVANT APPOINTED TO A POST PERMANENT OR TEMPORARY ARE REGULATED BY THE TERMS OF THE CONTRACT OF EMPLOYMENT EXPRESS OR IMPLIED AND SUBJECT THERETO BY THE RULES APPLICABLE TO THE MEMBERS OF THE PARTICULAR SERVICE . 18. THE APPOINTMENT OF A GOVERNMENT SERVANT TO A PE RMANENT POST MAY BE SUBSTANTIVE OR ON PROBATION OR ON AN OFFICIATING BA SIS. A SUBSTANTIVE APPOINTMENT TO A PERMANENT POST IN PUBLIC SERVICE C ONFERS NORMALLY ON THE SERVANT SO APPOINTED A SUBSTANTIVE RIGHT TO THE POS T AND HE BECOMES ENTITLED TO HOLD A 'LIEN' ON THE POST. THIS 'LIEN' IS DEFINED IN FUNDAMENTAL RULE S. III CH. II R. 9(13) AS THE TITLE OF A GOV ERNMENT SERVANT TO HOLD SUBSTANTIVELY A PERMANENT POST INCLUDING A TENURE POST TO WHICH HE HAS BEEN APPOINTED SUBSTANTIVELY. THE GOVERNMENT CANNOT TERMINATE HIS SERVICE UNLESS IT IS ENTITLED TO DO SO (1) BY VIRTU E OF A SPECIAL TERM OF THE CONTRACT OF EMPLOYMENT E.G. BY GIVING THE REQUISI TE NOTICE PROVIDED BY THE CONTRACT OR (2) BY THE RULES GOVERNING THE COND ITIONS OF HIS SERVICE E.G. ON ATTAINMENT OF THE AGE OF SUPERANNUATION PR ESCRIBED BY THE RULES OR ON THE FULFILLMENT OF THE CONDITIONS FOR COMPULSORY RETIREMENT OR SUBJECT TO CERTAIN SAFEGUARDS ON THE ABOLITION OF THE POST OR ON BEING FOUND GUILTY AFTER A PROPER ENQUIRY ON NOTICE TO HIM OF MISCOND UCT NEGLIGENCE INEFFICIENCY OR ANY OTHER DISQUALIFICATION. AN APPO INTMENT TO A PERMANENT POST IN GOVERNMENT SERVICE ON PROBATION MEANS AS I N THE CASE OF A PERSON APPOINTED BY A PRIVATE EMPLOYER THAT THE SERVANT S O APPOINTED IS TAKEN ON TRIAL. THE PERIOD OF PROBATION MAY IN SOME CASES BE FOR A FIXED PERIOD E.G. FOR SIX MONTHS OR FOR ONE YEAR OR IT MAY BE EXPRESS ED SIMPLY AS 'ON PROBATION' WITHOUT ANY SPECIFICATION OF ANY PERIOD. SUCH AN EMPLOYMENT ON PROBATION UNDER THE ORDINARY LAW OF MASTER AND SERVANT COMES TO AN END IF DURING OR AT THE END OF THE PROBATION THE SE RVANT SO APPOINTED ON TRIAL IS FOUND UNSUITABLE AND HIS SERVICE IS TERMIN ATED BY A NOTICE. AN APPOINTMENT TO OFFICIATE IN A PERMANENT POST IS USU ALLY MADE WHEN THE INCUMBENT SUBSTANTIVELY HOLDING THAT POST IS ON LEA VE OR WHEN THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 66 PERMANENT POST IS VACANT AND NO SUBSTANTIVE APPOINT MENT HAS YET BEEN MADE TO THAT POST. SUCH AN OFFICIATING APPOINTMENT COMES TO AN END ON THE RETURN OF THE INCUMBENT SUBSTANTIVELY HOLDING THE P OST FROM LEAVE IN THE FORMER CASE OR ON A SUBSTANTIVE APPOINTMENT BEING M ADE TO THAT PERMANENT POST IN THE LATTER CASE OR ON THE SERVICE OF A NOTI CE OF TERMINATION AS AGREED UPON OR AS MAY BE REASONABLE UNDER THE ORDINARY LAW . IT IS THEREFORE QUITE CLEAR THAT APPOINTMENT TO A PERMANENT POST IN A GOV ERNMENT SERVICE EITHER ON PROBATION OR ON AN OFFICIATING BASIS IS FROM THE VERY NATURE OF SUCH EMPLOYMENT ITSELF OF A TRANSITORY CHARACTER AND I N THE ABSENCE OF ANY SPECIAL CONTRACT OR SPECIFIC RULE REGULATING THE CO NDITIONS OF THE SERVICE THE IMPLIED TERM OF SUCH APPOINTMENT UNDER THE ORD INARY LAW OF MASTER AND SERVANT IS THAT IT IS TERMINABLE AT ANY TIME. IN SHORT IN THE CASE OF AN APPOINTMENT TO A PERMANENT POST IN A GOVERNMENT SER VICE ON PROBATION OR ON AN OFFICIATING BASIS THE SERVANT SO APPOINTED D OES NOT ACQUIRE ANY SUBSTANTIVE RIGHT TO THE POST AND CONSEQUENTLY CANN OT COMPLAIN ANY MORE THAN A PRIVATE SERVANT EMPLOYED ON PROBATION OR ON AN OFFICIATING BASIS CAN DO IF HIS SERVICE IS TERMINATED AT ANY TIME. LIKEW ISE AN APPOINTMENT TO A TEMPORARY POST IN A GOVERNMENT SERVICE MAY BE SUBST ANTIVE OR ON PROBATION OR ON AN OFFICIATING BASIS. HERE ALSO IN THE ABSENCE OF ANY SPECIAL STIPULATION OR ANY SPECIFIC SERVICE RULE T HE SERVANT SO APPOINTED ACQUIRES NO RIGHT TO THE POST AND HIS SERVICE CAN B E TERMINATED AT ANY TIME EXCEPT IN ONE CASE NAMELY WHEN THE APPOINTMENT TO A TEMPORARY POST IS FOR A DEFINITE PERIOD. IN SUCH A CASE THE SERVANT S O APPOINTED ACQUIRE A RIGHT TO HIS TENURE FOR THAT PERIOD WHICH CANNOT BE PUT AN END TO UNLESS THERE IS A SPECIAL CONTRACT ENTITLING THE EMPLOYER TO DO SO ON GIVING THE REQUISITE NOTICE OR THE PERSON SO APPOINTED IS ON ENQUIRY HELD ON DUE NOTICE TO THE SERVANT AND AFTER GIVING HIM A REASON ABLE OPPORTUNITY TO DEFEND HIMSELF FOUND GUILTY OF MISCONDUCT NEGLIGE NCE INEFFICIENCY OR ANY OTHER DISQUALIFICATION AND IS BY WAY OF PUNISHM ENT DISMISSED OR REMOVED FROM SERVICE OR REDUCED IN RANK. THE SUBSTA NTIVE APPOINTMENT TO A TEMPORARY POST UNDER THE RULES USED TO GIVE THE SERVANT SO APPOINTED CERTAIN BENEFITS REGARDING PAY AND LEAVE BUT WAS O THERWISE ON THE SAME FOOTING AS APPOINTMENT TO A TEMPORARY POST ON PROBA TION OR ON AN OFFICIATING BASIS THAT IS TO SAY TERMINABLE BY NO TICE EXCEPT WHERE UNDER THE RULES PROMULGATED IN 1949 TO WHICH REFERENCE WI LL HEREAFTER BE MADE HIS SERVICE HAD RIPENED INTO WHAT IS CALLED A QUASI -PERMANENT SERVICE. 19. THE POSITION MAY THEREFORE BE SUMMARIZED AS F OLLOWS : IN THE ABSENCE OF ANY SPECIAL CONTRACT THE SUBSTANTIVE APP OINTMENT TO A PERMANENT POST GIVES THE SERVANT SO APPOINTED A RIG HT TO HOLD THE POST UNTIL UNDER THE RULES HE ATTAINS THE AGE OF SUPER ANNUATION OR IS COMPULSORILY RETIRED AFTER HAVING PUT IN THE PRESCR IBED NUMBER OF YEARS' SERVICE OR THE POST IS ABOLISHED AND HIS SERVICE CA NNOT BE TERMINATED EXCEPT BY WAY OF PUNISHMENT FOR MISCONDUCT NEGLIGENCE IN EFFICIENCY OR ANY OTHER DISQUALIFICATION FOUND AGAINST HIM ON PROPER ENQUIRY AFTER DUE NOTICE TO HIM. AN APPOINTMENT TO A TEMPORARY POST FOR A CE RTAIN SPECIFIED PERIOD ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 67 ALSO GIVES THE SERVANT SO APPOINTED A RIGHT TO HOLD THE POST FOR THE ENTIRE PERIOD OF HIS TENURE AND HIS TENURE CANNOT BE PUT A N END TO DURING THAT PERIOD UNLESS HE IS BY WAY OF PUNISHMENT DISMISSE D OR REMOVED FROM THE SERVICE. EXCEPT IN THESE TWO CASES THE APPOINTMENT TO A POST PERMANENT OR TEMPORARY ON PROBATION OR ON AN OFFICIATING BASIS OR A SUBSTANTIVE APPOINTMENT TO A TEMPORARY POST GIVES TO THE SERVAN T SO APPOINTED NO RIGHT TO THE POST AND HIS SERVICE MAY BE TERMINATED UNLES S HIS SERVICE HAD RIPENED INTO WHAT IS IN THE SERVICE RULES CALLED A QUASI-PERMANENT SERVICE. THE QUESTION FOR OUR CONSIDERATION IS WHETHER THE P ROTECTIONS OF ART. 311 ARE AVAILABLE TO EACH OF THESE SEVERAL CATEGORIES O F GOVERNMENT SERVANTS. 65. THEREFORE THE NATURE OF CONTRACT OF THE GOVERN MENT WITH THESE INTERVENERS HAS TO BE UNDERSTOOD IN THE SENSE IN WH ICH IT IS INTERPRETED BY THE SUPREME COURT IN THE AFORESAID CASE. IN ALL THESE CASES THE INTERVENERS WERE APPOINTED FOR A TEMPORARY POST AND THEY RESIGNED DU RING THE PROBATION PERIOD EXCEPT IN THE CASE OF SHRI Y.K. KAPOOR. NOW THE QUE STION IS AS TO WHETHER THESE PEOPLE WHOSE SERVICES WERE TERMINATED BY THE GOVERNMENT BY ACCEPTING THEIR RESIGNATION CAN BE TREATED AS HAVIN G BEEN RETIRED WHICH IS THE NECESSARY CONDITION FOR ROPING THEM WITHIN THE AMB IT OF RULE 13E. AGAIN THE HONBLE SUPREME COURT IN THE CASE OF STATE OF U.P. VS. KAUSHAL KISHORE SHUKLA (1991) 1 SCC 691 HAS OBSERVED AS UNDER: 7. A TEMPORARY GOVT. SERVANT HAS NO RIGHT TO HOLD THE POST HIS SERVICES ARE LIABLE TO BE TERMINATED BY GIVING HIM ONE MONTH S NOTICE WITHOUT ASSIGNING ANY REASON EITHER UNDER THE TERMS OF THE CONTRACT PROVIDING FOR SUCH TERMINATION OR UNDER THE RELEVANT STATUTORY RU LES REGULATING THE TERMS AND CONDITIONS OF TEMPORARY GOVT. SERVANTS. A TEMPO RARY GOVT. SERVANT CAN HOWEVER BE DISMISSED FROM SERVICE BY WAY OF P UNISHMENT. WHENEVER THE COMPETENT AUTHORITY IS SATISFIED THAT THE WORK AND CONDUCT OF A TEMPORARY SERVANT IS NOT SATISFACTORY OR THAT HIS CONTINUANCE IN SERVICE IS NOT IN PUBLIC INTEREST ON ACCOUNT OF HIS UNSUITA BILITY MISCONDUCT OR INEFFICIENCY IT MAY EITHER TERMINATE HIS SERVICES IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THE SERVICE OR THE RELEVANT RULES OR IT MAY DECIDE TO TAKE PUNITIVE ACTION AGAINST THE TEMPORARY GOVERNME NT SERVANT. IF IT ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 68 DECIDES TO TAKE PUNITIVE ACTION IT MAY HOLD A FORMA L INQUIRY BY FRAMING CHARGES AND GIVING OPPORTUNITY TO THE GOVT. SERVANT IN ACCORDANCE WITH THE PROVISIONS OF ARTICLE 311 OF THE CONSTITUTION. SINC E A TEMPORARY GOVT. SERVANT IS ALSO ENTITLED TO THE PROTECTION OF ARTIC LE 311(2) IN THE SAME MANNER AS A PERMANENT GOVT. SERVANT VERY OFTEN HE QUESTION ARISES WHETHER AN ORDER OF TERMINATION IS IN ACCORDANCE WI TH THE CONTRACT OF SERVICE AND RELEVANT RULES REGULATING THE TEMPORARY EMPLOYMENT OR IT IS BY WAY OF PUNISHMENT. IT IS NOW WELL SETTLED THAT THE FORM OF THE ORDER IS NOT CONCLUSIVE AND IT IS OPEN TO THE COURT TO DETERMINE THE TRUE NATURE OF THE ORDER. IN PARSHOTAM LAL DHINGRA V. UNION OF INDIA M ANU/SC/0126/1957 A CONSTITUTION BENCH OF THIS COURT HELD THAT THE ME RE USE OF EXPRESSIONS LIKE TERMINATE OR DISCHARGE IS NOT CONCLUSIVE A ND IN SPITE OF THE USE OF SUCH EXPRESSIONS THE COURT MAY DETERMINE THE TRUE NATURE OF THE ORDER OF ASCERTAIN WHETHER THE ACTION TAKEN AGAINST THE GOVT . SERVANT IS PUNITIVE IN NATURE. THE COURT FURTHER HELD THAT IN DETERMINING THE TRUE NATURE OF THE ORDER THE COURT SHOULD APPLY TWO TESTS NAMELY: (1) WHETHER THE TEMPORARY GOVT. SERVANT HAD A RIGHT TO THE POST OR THE RANK O R (2) WHETHER HE HAS BEEN VISITED WITH EVEN CONSEQUENCES; AND IF EITHER OF THE TESTS IS SATISFIED IT MUST BE HELD THAT THE ORDER OF TERMINATION OF A TEMPORARY GOVT. SERVANT IS BY WAY OF PUNISHMENT. IT MUST BE BORNE IN MIND T HAT A TEMPORARY GOVT. SERVANT HAS NO RIGHT TO HOLD THE POST AND TERMINATI ON OF SUCH A GOVT. SERVANT DOES NOT VISIT HIM WITH ANY EVIL CONSEQUENC ES. THE EVEN CONSEQUENCES AS HELD IN PARSHOTAM LAL DHINGRAS CAS E (SUPRA) DO NOT INCLUDE THE TERMINATION OF SERVICES OF A TEMPORARY GOVT. SERVANT IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF SERVICE . THE VIEW TAKEN BY THE CONSTITUTION BENCH IN DHINGRAS CASE HAS BEEN R EITERATED AND AFFIRMED BY THE CONSTITUTION BENCH DECISIONS OF THIS COURT I N THE STATE OF ORISSA AND ANR. V. RAM NARAYAN DAS MANU/SC/0311/1960; R.C. LACY V. THE STATE OF BIHAR AND ORS. CA NO. 590/62 DECIDED ON 23 .10.1963; CHAMPAKLAL CHIMANLAL SHAH V. THE UNION OF INDIA MAN /SC/0274/1963; JAGDISH MINER V. THE UNION OF INDIA MANU/SC/0277/19 63; A.G. BENJAMIN V. UNION OF INDIA C.A. NO. 1341/66 DECIDED ON 13.12.1966 AND SHAMSHER SINGH AND ANR. V. STATE OF PUNJAB MANU/SC/ 0073/1974 THESE DECISIONS HAVE BEEN DISCUSSED AND FOLLOWED BY A THREE JUDGE BENCH IN STATE OF PUNJAB AND ANR. V. SHRI SUKH RAJ BAHADU R MANU/SC/0182/1968. 66. HAVING SEEN THE INTERPRETATION OF THE TERMS TE MPORARY POSTS AND PROBATION NOW WE WILL PROCEED TO SEE WHETHER SUC H PERSONS WHO ARE ON PROBATION HOLDING SUCH TEMPORARY POSTS COULD BE S AID TO HAVE RETIRED IN TERMS OF RULE 13E. THE TERM RETIREMENT ITSELF IS A SUBJECT MATTER WHICH ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 69 WAS JUDICIALLY NOTICED AND HAS TO BE UNDERSTOOD DI FFERENTLY FROM THE TERM RESIGNATION. THE SUM AND SUBSTANCE OF THE FIRST S ET OF 5 INTERVENERS WHO HAVE RESIGNED IS THAT THEY ARE THE ONE WHO HAVE NO T RETIRED FROM THE SERVICE OF THE TRIBUNAL BECAUSE THEY RESIGNED BEFORE THEY W ERE CONFIRMED IN THE POST. 67. THE HONBLE SUPREME COURT IN THE CASE OF UOI VS . GOPAL CHANDRA MISRA & OTHERS (1978) 2 SCC 301 IN PARA 23 OF THE JUDGMENT HAS REFERRED THE DICTIONARY MEANING OF THE TERM RESIGNATION AS UNDER: 23. RESIGNATION IN THE DICTIONARY SENSE MEAN S THE SPONTANEOUS RELINQUISHMENT OF ONES OWN RIGHT. THIS IS CONVEYED BY THE MAXIM: RESINATIO EST JURIS PROPII SPONTANEA REFUTATIO (SEE CARL JOWITTS DICTIONARYS OF ENGLISH LAW). . IN RELATION TO AN OFFICE IT CONNOTES THE ACT OF GIVING UP OR RELINQUISHING THE OFFICE. TO RELI NQUISH AN OFFICE MEANS TO CEASE TO HOLD THE OFFICE OR TO LOOSE HOLD OF TH E OFFICE; AND TO LOOSE HOLD OF OFFICE (CF. SHORTER OXFORD DICTIONARY); AN D TO LOOSE HOLD OF OFFICE IMPLIES TO DETACH UNFASTEN UNDO OR UNTIE THE BINDING KNOT OF INK WHICH HOLDS ONE TO THE OFFICE AND THE OBLIGATI ONS AND PRIVILEGES THAT GO WITH IT. 68. THE TERM RESIGNATION AS UNDERSTOOD IN THE ABO VE CASE IS A DELIBERATE ACT OF RELINQUISHMENT OF SERVICE WHEREAS THE RETI REMENT HAS A DIFFERENT CONNOTATION. THE TERM RETIREMENT ITSELF IS USED B Y DIFFERENT SERVICE REGULATIONS AS AN EVENT THAT TAKES PLACE ON ATTAINI NG THE SUPERANNUATION. VOLUNTARY RETIREMENT IS ALSO PROVIDED WHICH CAN BE OBTAINED ON COMPLETING PRESCRIBED YEARS OF SERVICE. SOMETIMES AN EMPLOYER MAY COMPULSORY RETIRE AN EMPLOYEE. FUNDAMENTAL RULE 56 PROVIDES THAT EVER Y GOVERNMENT SERVANT SHALL RETIRE FROM SERVICE ON THE AFTERNOON OF THE L AST DAY OF THE MONTH IN ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 70 WHICH HE ATTAINS THE AGE OF SIXTY YEARS WHICH MEAN S THAT THE RETIREMENT TAKES PLACE ON THE SUPERANNUATION OR IN CASE OF VOL UNTARY RETIREMENT ON COMPLETION OF QUALIFYING PERIOD OF SERVICE. 69. IN THE CASE OF THE MEMBERS OF THE INCOME TAX A PPELLATE TRIBUNAL RULE 11 OF THE AFORESAID ITAT MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE ) RULES 1964 PROVIDE THAT THE DATE OF RET IREMENT OF A MEMBER SHALL BE THE DATE ON WHICH HE ATTAINS THE AGE OF 62 YEAR S AND NOT THE LAST DAY OF THE MONTH AS IN THE CASES OF OTHER GOVERNMENT SERVA NTS. THAT MEANS RETIREMENT IN RELATION TO ITAT MEMBERS IS DIFFERENT FROM THE RETIREMENT IN RELATION TO OTHER GOVERNMENT SERVANTS TO WHICH LARG E CLASS THEY BELONG. HERE THE MEMBER RETIRES WHEN HE ATTAINS THE AGE OF 62 Y EARS. IN THE DATE OF RETIREMENT THERE IS NO REFERENCE TO THE LAST DAY O F THE MONTH IN WHICH THE OTHER GOVERNMENT SERVANTS NORMALLY RETIRE. THE RULE HAS BEEN SUBSEQUENTLY AMENDED TO PROVIDE FOR A DIFFERENT AGE OF RETIREMEN T OF THE OFFICE OF THE PRESIDENT WHICH IS NOW AT 65 YEARS THAT MEANS RET IREMENT AS A MEMBER TAKES PLACE IN THE TRIBUNAL ONLY UPON ATTAINMENT OF SUPERANNUATION AS RETIREMENT DOES NOT TAKE PLACE PRIOR TO THAT. OF CO URSE RETIREMENT IS ALSO CESSATION OF SERVICE BUT THAT IS NOT AT THE EVENT O F RETIREMENT BUT AN ACT OF RESIGNATION ON THE PART OF THE EMPLOYEE CONCERNED WHICH IS OF COURSE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 71 SUBJECT TO ACCEPTANCE BY THE EMPLOYER IN ACCORDANCE WITH RULES PRESCRIBED THEREIN. 70. THE DIFFERENCE BETWEEN THE RETIREMENT AND THE RESIGNATION HAS BEEN NOTICED BY THE SUPREME COURT IN THE CASES OF JAIPAL SINGH VS. (SMT.) SUMITRA MAHAJAN (SUPRA); AND UCO BANK & OTHERS (S UPRA). THE SUPREME COURT IN THE AFORESAID CASES NOTICED THAT THERE WAS A DIFFERENCE BETWEEN RETIREMENT AND RESIGNATION. IT ALSO NOTICED THA T SUCH DIFFERENCE WAS ALREADY ACCEPTED BY THE APEX COURT IN THE CASE OF R ESERVE BANK OF INDIA VS. CECIL DENNIS SOLOMON & ANOTHER (2004) 9 SCC 461 WH EREIN THE APEX COURT HAS HELD THAT IN SERVICE JURISPRUDENCE THE E XPRESSIONS SUPERANNUATION VOLUNTARY RETIREMENT COMPULSORY R ETIREMENT AND RESIGNATION CONVEY DIFFERENT CONNOTATIONS. THE APEX COURT HELD THAT IN THE CASE OF RESIGNATION IT CAN BE TENDERED AT ANY TIME BUT IN THE CASE OF VOLUNTARY RETIREMENT IT CAN ONLY BE SOUGHT FOR AFT ER RENDERING PRESCRIBED PERIOD OF QUALIFYING SERVICE. 71. NOW WE WILL ADVERT TO THE DECISION OF THE SUPRE ME COURT IN THE CASE OF UCO BANK & OTHERS VS. SANWAR MAL (SUPRA) WHEREI N THE HONBLE SUPREME COURT HAS OBSERVED AS UNDER: 9. WE FIND MERIT IN THESE APPEALS. THE WORDS RESI GNATION AND RETIREMENT CARRY DIFFERENT MEANINGS IN COMMON PAR LANCE. AN EMPLOYEE CAN RESIGN AT ANY POINT OF TIME EVEN ON THE SECOND DAY OF HIS APPOINTMENT BUT IN THE CASE OF RETIREMENT HE RETIRES ONLY AFTER ATTAINING THE AGE OF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 72 SUPERANNUATION OR IN THE CASE OF VOLUNTARY RETIREME NT ON COMPLETION OF QUALIFYING SERVICE. THE EFFECT OF RESIGNATION AND R ETIREMENT TO THE EXTENT THAT THERE ARE SEVERANCE OF EMPLOYMENT BUT IN SERVI CE JURISPRUDENCE BOTH THE EXPRESSIONS ARE UNDERSTOOD DIFFERENTLY. UNDER T HE REGULATIONS THE EXPRESSIONS RESIGNATION AND RETIREMENT HAVE BEE N EMPLOYED FOR DIFFERENT PURPOSE AND CARRY DIFFERENT MEANINGS. THE PENSION SCHEME HEREIN IS BASED ON ACTUARIAL CALCULATION; IT IS A S ELL-FINANCING SCHEME WHICH DOES NOT DEPEND UPON BUDGETARY SUPPORT AND CO NSEQUENTLY IT CONSTITUTES A COMPLETE CODE BY ITSELF. THE SCHEME E SSENTIALLY COVERS RETIREES AS THE CREDIT BALANCE TO THEIR PROVIDENT F UND ACCOUNT IS LARGER AS COMPARED TO EMPLOYEES WHO RESIGNED FROM SERVICE. MO REOVER RESIGNATION BRINGS ABOUT COMPLETE CESSATION OF MASTER AND SERVA NT RELATIONSHIP WHEREAS VOLUNTARY RETIREMENT MAINTAINS THE RELATION SHIP FOR HE PURPOSES OF GNAT OF RETRIAL BENEFITS IN VIEW OF THE PAST SERVI CE. SIMILARLY ACCEPTANCE OF RESIGNATION IS DEPENDENT UPON DISCRETION OF THE EMPLOYER WHEREAS RETIREMENT IS COMPLETION OF SERVICE IN TERMS OF REG ULATIONS/ RULES FRAMED BY THE BANK. RESIGNATION CAN BE TENDERED IRRESPECTI VE OF THE LENGTH OF SERVICE WHEREAS IN THE CASE OF VOLUNTARY RETIREMENT THE EMPLOYEE HAS TO COMPLETE QUALIFYING SERVICE FOR RETRIAL BENEFITS. F URTHER THERE ARE DIFFERENT YARDSTICKS AND CRITERIA FOR SUBMITTING RESIGNATION VIS--VIS VOLUNTARY RETIREMENT AND ACCEPTANCE THEREOF. SINE THE PENSION REGULATIONS DISQUALIFY AN EMPLOYEE WHO HAS RESIGNED FROM CLAIMING PENSIO N THE RESPONDENT CANNOT CLAIM MEMBERSHIP OF THE FUND. IN OUR VIEW R EGULATION 22 PROVIDES FOR DISQUALIFICATION OF EMPLOYEES WHO HAVE RESIGNED FROM SERVICE AND FOR THOSE WHO HAVE BEEN DISMISSED OR REMOVED FROM SERVI CE. HENCE WE DO NOT FIND ANY MERIT IN THE ARGUMENTS ADVANCED ON BEH ALF OF THE RESPONDENT THAT REGULATION 22 MAKES AN ARBITRARY AND UNREASONA BLE CLASSIFICATION REPUGNANT TO ARTICLE 14 OF THE CONSTITUTION BY KEEP ING OUT SUCH CLASS OF EMPLOYEES. THE VIEW WE HAVE TAKEN IS SUPPORTED BY T HE JUDGMENT OF THIS COURT IN THE CASE OF RESERVE BANK OF INDIA AND ANR. V. CECIL DENNIS SOLOMON AND ANR. REPORTED IN [2003 (10) SCALE 49]. BEFORE CONCLUDING WE MAY STATE THAT CLAUSE 22 IS NOT IN THE NATURE OF PENALTY AS ALLEGED. IT ONLY DISENTITLES AN EMPLOYEE WHO HAS RESIGNED FROM SERVICE FROM BECOMING A MEMBER OF THE FUND. SUCH EMPLOYEES HAVE RECEIVED THEIR RETRIAL BENEFITS EARLIER. THE PENSION SCHEME AS ST ATED ABOVE ONLY PROVIDES FOR A SECOND RETRIAL BENEFIT. HENCE THERE IS NO QUE STION OF PENALTY BEING IMPOSED ON SUCH EMPLOYEES AS ALLEGED. THE PENSION S CHEME ONLY PROVIDES FOR AN AVENUE FOR INVESTMENT TO RETIREES. THEY ARE PROVIDED AVENUE TO PUT IN THEIR SAVINGS AND AS A TERM OR CONDITION WHICH I S MORE IN THE NATURE OF AN ELIGIBILITY CRITERIA THE SCHEME DISENTITLES SUCH CATEGORY OF EMPLOYEES OUT OF IT. 72. IN THE LIGHT OF THE AFORESAID DECISIONS IT IS D IFFICULT TO SAY THAT DR. RAKESH GUPTA AND OTHER SUCH LIKE INTERVENERS HAVE RETIRED FROM SERVICE. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 73 THEY HAVE RESIGNED AND TERMINATED THEIR CONTRACT OF EMPLOYMENT WITH THE GOVERNMENT. IN OTHER WORDS THEY DO NOT HOLD ANY PO ST AND NO QUESTION OF ANY CONDITIONS OF SERVICES THAT CAN BE MADE APPLICA BLE TO THEM AFTER ONCE THEY RESIGNED FROM THEIR OFFICE. THE EFFECT OF RES IGNATION DURING THE PROBATION PERIOD IS FORFEITURE OF SERVICE. THE PAST SERVICE RENDERED BY THE EMPLOYEE CONCERNED BECOMES NON EST AS THE SAME GOT FORFEITED THE MOMENT THEY HAVE RESIGNED FROM OFFICE PARTICULARLY WHEN T HE EMPLOYEE WAS NOT CONFIRMED IN SERVICE AND WAS STILL ON PROBATION TH AT TOO ON A TEMPORARY POST. 73. IT HAS ALREADY BEEN HELD BY THE APEX COURT IN T HE CASE OF PARSHOTAM LAL DHINGRA VS. UOI (SUPRA) EXTRACTED ABOVE THAT WHEN A PERSON IS APPOINTED ON PROBATION EVEN ON A PERMANENT POST T HAT SERVANT IS TO BE TAKEN AS APPOINTED ON TRAINING. THE SUPREME COURT AGAIN I N THE CASE OF STATE OF U.P. VS. KAUSHAL KISHORE SHUKLA (1991) 1 SCC 691 HA S HELD THAT THE PROBATIONER DOES NOT HAVE ANY RIGHT TO HOLD THE POS T AND HAS RIGHT TO CONTINUE WOULD ARISE ONLY ON CONFIRMATION. AGAIN I N THE CASE OF STATE OF UP VS. AKBAR ALI KHAN (SUPRA) HAS HELD THAT WHEN A PE RSON CONTINUES ON PROBATION HE ACQUIRES NO SUBSTANTIVE RIGHT TO HOLD THE POST. 74. IN OUR VIEW THESE PERSONS WHO HAVE RESIGNED FR OM SERVICE DURING THE PROBATION PERIOD ITSELF CANNOT BE TREATED AS HAVING BEEN RETIRED FROM SERVICE WITHIN THE MEANING OF SEC. 13E OR 11 OF THE ITAT M EMBERS (RECRUITMENT ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 74 AND CONDITIONS OF SERVICE ) RULES 1963. IN OUR OPI NION THEY DEFINITELY CANNOT BE HIT BY THE PROVISIONS OF RULE 13E WHICH I S BROUGHT IN THE STATUTE BOOK MUCH AFTER THEY HAVE RELINQUISHED THEIR POSTS AND GOT THEIR PAST SERVICE FORFEITED. IN OUR VIEW BY FOLLOWING THE ABOVE PRIN CIPLES AND IN THE LIGHT OF THE SUPREME COURT DECISIONS DISCUSSED HEREIN WE CANNOT ACCEPT THE THEORY THAT THEY SHOULD BE TREATED AS HAVING RETIRED FRO M SERVICE AS A MEMBER AND THEY SHOULD BE DISQUALIFIED FROM APPEARING BEFORE T HE ITAT IF THEY ARE OTHERWISE QUALIFIED TO APPEAR AS THAT WILL BE ONLY BE IN VIOLATION TO THE RATIO LAID DOWN BY THE SUPREME COURT IN THE CASE OF UCO B ANK & OTHERS CITED SUPRA. 75. COMING TO THE PLEA OF THE MINISTRY THAT THE SPI RIT BEHIND P.C. JAINS CASE (SUPRA) REQUIRED TO BE APPLIED IN THE LARGER INTEREST OF THE INSTITUTION CANNOT ALSO BE ACCEPTED. HAVING REGARD TO THE FACT THAT IN THE CASE OF P.C. JAIN (SUPRA) THE DELHI HIGH COURT WAS NOT AT ALL CONCERNED WITH ANY EMPLOYEE WHO WAS APPOINTED ON TEMPORARY POST AND O N A PROBATIONARY PERIOD AND RESIGNED FROM SERVICE DURING THE PROBATI ON PERIOD. THE INSTANCES MENTIONED IN THE CASE OF P.C. JAIN (SUPRA) DO NOT EVEN DEAL WITH SUCH TYPE OF CASES. A JUDGMENT IS AN AUTHORITY FOR A LAW THAT IS PRONOUNCED ON THE FACTS OF THAT CASE. IT CANNOT BE USED TO SWEEP ALL OTHER CASES IRRESPECTIVE OF THE FACTS CONCERNED THEREIN. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 75 76. MOREOVER IT MUST BE APPRECIATED THAT IN THE CA SE OF P.C. JAIN (SUPRA) THE HONBLE DELHI HIGH COURT PROCEEDED WITH INTERP RETATION FOR HE PROVISION OF STATUTE AND NOT A CONDITION OF SERVICE AS HAS ALREADY BEEN DISCUSSED EARLIER. THEREFORE WHAT WE ARE BASICALLY REQUIRED TO INTERPRET HERE IS RULE 13E WHICH IS PART OF ITAT MEMBERS (RECRUIT MENT AND CONDITIONS OF SERVICE ) RULES 1963 AS A PART OF CONDITIONS O F SERVICE. THEREFORE THE RATIO LAID DOWN THEREIN MAY NOT STRICTLY APPLY TO A CASE WHERE AMENDMENTS ARE TO THE CONDITIONS OF SERVICE. ADMITTEDLY CON DITIONS OF SERVICE CAN ONLY BE IN RELATION TO THE EMPLOYEES WHO ARE IN SERVICE AND NOT TO THOSE PERSONS WHO LOST THE RIGHT TO THE POST LONG BACK MUCH BEFOR E THE SAME WAS BROUGHT BY WAY OF AMENDMENT MADE SUBSEQUENTLY. WE THEREFOR E UNHESITATINGLY ANSWER QUESTION NOS. 5 & 6 IN FAVOUR OF THE INTERV ENERS. THEE IS NOTHING IN THE RULE 13E TO DEBAR SUCH PERSONS. 77. NOW AS REGARDS SHRI Y.K. KAPUR IS CONCERNED HE WAS RELINQUISHED OF HIS POST IN THE ITAT W.E.F. 1-7-2004 HAVING JOINED THE SERVICE ON 3-12- 2001 AFTER TWO YEARS OF SERVICE. THE TERMS OF APP OINTMENT OF SHRI Y.K. KAPUR ARE ALMOST THE SAME AS THAT OF OTHER INTERVEN ERS WHO RESIGNED. THE POST IS STATED TO BE PURELY TEMPORARY BUT LIKELY TO BE CONTINUED. SHRI Y.K. KAPUR WAS SUPPOSED TO BE ON PROBATION FOR A PERIOD OF 2 YEARS BUT THE SAID PERIOD COULD BE EXTENDED AT THE DISCRETION OF THE A PPOINTING AUTHORITY. IN THIS ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 76 CASE IT WAS SUBMITTED ON BEHALF OF SHRI Y.K. KAPU R THAT NO CONFIRMATION ORDER WAS ISSUED TO HIM. THE OFFICE RECORD DOES NOT SHOW THAT HE WAS CONFIRMED IN SERVICE. THAT MEANS HIS POST DID NOT BECOME PERMANENT. HE RESIGNED TO THE POST AFTER 2 YEARS BUT BEFORE THE CONFIRMATION TOOK PLACE. THAT MEANS HE RESIGNED DURING PROBATION PERIOD. IN IDENTICAL SITUATION THE APEX COURT IN THE CASE OF WASIM BEG VS. STATE OF U .P. & OTHERS (1998) 3 SCC 321 ITSELF HAS ANSWERED THE QUESTION WHETHER A N EMPLOYEE AT THE END OF PROBATIONARY PERIOD AUTOMATICALLY GETS CONFIRMAT ION IN THE POST OR WHETHER AN ORDER OF CONFIRMATION OR ANY SPECIFIC AC T ON THE PART OF THE EMPLOYER CONFIRMING THE EMPLOYEE IS NECESSARY WOUL D DEPEND UPON THE PROVISIONS IN THE RELEVANT SERVICE RULES RELATING T O PROBATION AND CONFIRMATION. IN THOSE CASES WHERE THE RULES PROVID E FOR A MAXIMUM PERIOD OF PROBATION AND WHICH PROBATION CANNOT BE EXTENDE D THE APEX COURT HAS OBSERVED AS UNDER: 15. WHETHER AN EMPLOYEE AT THE END OF PROBATIONARY PERIOD AUTOMATICALLY GETS CONFIRMATION IN THE POST OR WHETHER AN ORDER O F CONFIRMATION OR ANY SPECIFIC ACT ON THE PART OF THE EMPLOYER CONFIRMING THE EMPLOYEE IS NECESSARY WILL DEPEND UPON THE PROVISIONS IN THE R ELEVANT SERVICE RULES RELATING TO PROBATION AND CONFIRMATION. THERE ARE B ROADLY TWO SETS OF AUTHORITIES OF THIS COURT DEALING WITH THIS QUESTIO N. IN THOSE CASES WHERE THE RULES PROVIDE FOR A MAXIMUM PERIOD OF PROBATION BEYOND WHICH PROBATION CANNOT BE EXTENDED THIS COURT HAS HELD T HAT AT THE END OF THE MAXIMUM PROBATIONARY PERIOD THERE WILL BE A DEEMED CONFIRMATION OF THE EMPLOYEE UNLESS RULES PROVIDE TO THE CONTRARY. THI S IS THE LIE OF CASES STARTING WITH STATE OF PUNJAB V. DHARAM SINGH MANU/ SC/0183/1968 M.K. AGARWAL V. GURGAON GRAMIN BANK & ORS. MANU/SC/ 0899/1987 OM PARKASH MAURYA V. U.P. COOPERATIVE SUGAR FACTORI ES FEDERATION ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 77 LUCKNOW & ORS. MANU/SC/0476/1986 STATE OF GUJARAT V. AKHILESH C. BHARGAV & ORS. MANU/SC/0707/1987. 16. HOWEVER EVEN WHEN THE RULES PRESCRIBE A MAXIMU M PERIOD OF PROBATION IF THERE IS A FURTHER PROVISION IN THE RULES FOR CONTINUATION OF SUCH PROBATION BEYOND THE MAXIMUM PERIOD THE COURT S HAVE MADE AN EXCEPTION AND SAID THAT THERE WILL BE NO DEEMED CON FIRMATION IN SUCH CASES AND THE PROBATION PERIOD WILL BE DEEMED TO BE EXTEN DED. IN THIS CATEGORY OF CASES WE CAN PLACE SAMSHER SINGH V. STATE OF PUN JAB & ANR. MANU/SC/0073/1974 WHICH WAS THE DECISION OF A BENCH OF SEVEN JUDGES WHERE THE PRINCIPLE OF PROBATION NOT GOING BEYOND T HE MAXIMUM PERIOD FIXED WAS REITERATED BUT ON THE BASIS OF THE RULES WHICH WERE BEFORE THE COURT THIS COURT SAID THAT THE PROBATION WAS DEEME D TO HAVE BEEN EXTENDED. A SIMILAR VIEW WAS TAKEN IN THE CASE OF M UNICIPAL CORPORATION RAIPUR V. ASHOK KUMAR MISRA MANU/SC/0332/1991. IN S ATYA NARAYAN ATHYA V. HIGH COURT OF MADHYA PRADESH & ANR. MANU/S C/0202/1996 ALTHOUGH THE RULES PRESCRIBED THAT THE PROBATIONARY PERIOD SHOULD NOT EXCEED TWO YEARS AND AN ORDER OF CONFIRMATION WAS ALSO NECESSARY THE TERMINATION ORDER WAS ISSUED WITHIN THE EXTENDED PE RIOD OF PROBATION. HENCE THE TERMINATION WAS UPHELD. 17. THE OTHER LINE OF CASES DEALS WITH RULES WHERE THEE IS NO MAXIMUM PERIOD PRESCRIBED FOR PROBATION AND EITHER THERE IS A RULE PROVIDING FOR EXTENSION OF PROBATION OR THERE IS A RULE WHICH REQ UIRES A SPECIFIC ACT ON THE PART OF THE EMPLOYER (EITHER BY ISSUING AN ORDE R OF CONFIRMATION OR ANY SIMILAR ACT) WHICH WOULD RESULT IN CONFIRMATION OF THE EMPLOYEE. IN THESE CASES UNLESS THEE IS SUCH AN ORDER OF CONFIRMATION THE PERIOD 0F PROBATION WOULD CONTINUE AND THERE WOULD BE NO DEEMED CONFIRM ATION A THE END OF THE PRESCRIBED PROBATIONARY PERIOD. IN THIS LINE OF CASES ONE CAN PUT SUKHBANS SINGH V. STATE OF PUNJAB MANU/SC/0356/1962 STATE OF UTTAR PRADESH V. AKBAR ALI KHAN MANU/SC/ 0231/1966 SHRI KEDAR NASTH BAHL V. THE STATE OF PUNJAB & ORS. MANU/SC/0593/197 2 DHANJIBHAI RAMJIBHAI V. STATE OF GUJARAT MANU/SC/1385/1997 MU NICIPAL CORPORATION RAIPUR V. ASHOK KUMAR MISRA (SUPRA) AN D STATE OF PUNJAB V. BALDEV SINGH KHOSLA MANU/SC/0520/1996. IN THE RECEN T CASE OF DAYARAM DAYAL V. STATE OF M.P. AND ANR. MANU/SC/082 4/1997 ( TO WHICH ONE OF US WAS A PARTY) ALL THESE CASES HAVE B EEN ANALYSED AND IT HAS BEEN HELD THAT WHERE THE RULES PROVIDE THAT THE PE RIOD OF PROBATION CANNOT BE EXTENDED BEYOND THE MAXIMUM PERIOD THERE WILL BE A DEEMED CONFIRMATION AT THE END OF THE MAXIMUM PROBATIONARY PERIOD UNLESS THERE IS ANYTHING TO THE CONTRARY IN THE RULES. 78. IN THE LIGHT OF THE ABOVE DISCUSSIONS THE SAID OFFER OF APPOINTMENT ITSELF PRESCRIBES 2 YEARS AS A PERIOD OF PROBATION WITH A DISCRETION TO THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 78 EMPLOYER TO INCREASE SUCH PERIOD ON ITS DISCRETION. HERE WHETHER DISCRETION WAS EXERCISED TO EXTEND SUCH PERIOD OF PROBATION IS NOT FORTHCOMING FROM THE RECORDS. IT WAS CONFIRMED BY SHRI Y.K. KAPUR T HAT HE WAS NOT CONFIRMED DURING THE PERIOD PRIOR TO RESIGNATION. IN THE LIGH T OF THIS WE ALSO HOLD BY TAKING SUPPORT BY THE RATIO OF DECISIONS OF THE APE X COURT CITED ABOVE THAT HE RESIGNED FROM SERVICE MUCH BEFORE HIS CONFIRMATI ON TOOK PLACE AND WILL FIT INTO THE SAME OTHER CASES OF INTERVENERS WHO HA VE RESIGNED BEFORE THE DATE OF CONFIRMATION DURING THE PROBATION PERIOD. ACCOR DINGLY THE ANSWER THAT IS GIVEN TO THEIR CASES WILL EQUALLY APPLY TO SHRI Y. K. KAPUR. 79. BEFORE PARTING WITH THIS ISSUE WE MAY MENTION THAT THE MINISTRY OF LAW & JUSTICE IN THEIR AFFIDAVIT IN RELATION TO THE RESIGNED MEMBERS HAVE DRAWN OUR ATTENTION TO ARTICLE 220 OF THE CONSTITUT ION IN RELATION TO HIGH COURT JUDGES WHEREIN IT IS PROVIDED THAT PERMANENT JUDGE OF A HIGH COURT SHALL NOT PLEA OR ACT IN ANY COURT OR BEFORE ANY AU THORITY EXCEPT THE SUPREME COURT AND THE OTHER HIGH COURTS. IN OTHER WORDS ALL SUCH PERSONS WHO ARE NOT PERMANENT JUDGES OF THE HIGH COURT AND HAVE RES IGNED BEFORE BECOMING PERMANENT MAY NOT BE SUBJECTED TO DEBAR UNDER ARTI CLE 221 OF THE CONSTITUTION BUT AT THE SAME TIME THEY PLEADED THAT THE SPIRIT OF P.C. JAINS CASE (SUPRA) BE APPLICABLE EVEN TO THEM. HOWEVER T HE MINISTRY SUGGESTED THAT A MAGNANIMOUS VIEW BE TAKEN IN RELATION THERET O. IN OUR OPINION IN THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 79 LIGHT OF THE DECISION OF THE APEX COURT IN THE CASE OF UCO BANK (SUPRA) THEIR CASE DOES NOT FALL WITHIN THE MEANING OF THE EXPRESSION RETIREMENT USED IN RULE 13E OF THE ITAT MEMBERS (RECRUITMENT & CONDITIONS OF SERVICE) AMENDMENT RULES 2009 AND THEREFORE DO NOT FALL WITHIN THIS CATEGORY. WE ARE NOT TAKING ANY MAGNANIMOUS VIEW B UT WE ARE ONLY CLARIFYING THE POSITION OF LAW AS WE UNDERSTAND. HE RE IT MUST BE APPRECIATED THE PERSONS HAVE RESIGNED FROM SERVICE WHEN THEY WE RE ONLY A TEMPORARY POST AND THAT TOO DURING THEIR PROBATION PERIOD. SO THEY DO NOT HAVE ANY RIGHT TO HOLD THE POST AS CONSTRUED BY THE AUTHORITIES DI SCUSSED IN EARLIER PARAGRAPHS AND ON THEIR RESIGNATION THEY HAVE FORFE ITED THEIR SERVICE AND THEREFORE DEBARRING THEM UNDER ANY CONDITIONS OF SE RVICE THAT COMES TO PLAY MUCH AFTER THEIR RETIREMENT IN OUR OPINION CANNOT BE APPLIED TO THEM. 80. WE NOW TAKE UP THE CASES OF OTHER INTERVENERS W HO HAVE RETIED ON SUPERANNUATION. THE PROVISIONS OF SECTION 129 EXCEP T FOR 129(6) AND PROVISION OF SECTION 252 OF THE INCOME-TAX ACT 196 1 ARE PARI MATERIA. THE PROVISIONS OF INCOME TAX ACT ARE BROADLY LIFTED IN TO THE CUSTOMS ACT. THE LEGISLATION BROUGHT CERTAIN AMENDMENTS TO DISQUALIF Y THE PRESIDENT VICE PRESIDENT AND MEMBERS OF THAT TRIBUNAL TO PRACTICE BEFORE CESTAT AFTER CEASING TO HOLD SUCH OFFICE. THE SAID DISQUALIFICAT ION IS BROUGHT INTO STATUTE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 80 BY WAY OF AN AMENDMENT TO SEC. 129(6) OF THE CUSTOM S ACT WHICH READS AS UNDER: 129(6) ON CEASING TO HOLD OFFICE THE PRESIDENT VICE PRESIDENT OR OTHER MEMBER SHALL NOT BE ENTITLED TO APPEAR ACT OR PLEA D BEFORE THE APPELLATE TRIBUNAL. 81. IN RELATION TO ITAT THE LEGISLATURE HAS TAKEN A DIFFERENT ROUTE IN BRINGING SUCH AMENDMENT. ALTHOUGH THE INTENTION TO MAKE SUCH AN AMENDMENT WAS ADMITTEDLY COMMON BUT THE WAY THE LE GISLATION WANTS TO ACHIEVE THE SAID PURPOSE ARE ENTIRELY DIFFERENT A ND RATHER CAPABLE OF DIFFERENT INTERPRETATION BECAUSE AMENDMENTS TO THE STATUTE ARE NOT BROUGHT BY THE WISDOM OF THE PARLIAMENT. THERE IS NO CONDIT ION OF SERVICE AS SUCH AS RIGHTLY POINTED OUT BY THE ASG WHEN THE MATER WAS A RGUED BEFORE THE DELHI HIGH COURT IN THE CASE OF P.C. JAIN (SUPRA) WHEREA S WHEN IT CAME TO THE ITAT MEMBERS THE LEGISLATURE HAS TAKEN A DIFFEREN T ROUTE IN OUR VIEW RATHER A RISKY ROUTE. THEY DID NOT GO TO THE PARLIA MENT BUT USED THE POWERS OF THE PRESIDENT THAT WERE VESTED IN HER UNDER THE PRO VISIONS TO ARTICLE 309 OF THE CONSTITUTION WHICH IN OUR VIEW ARE LIMITED E ITHER TO THE RECRUITMENT OR TO THE CONDITIONS OF SERVICE. THIS ASPECT OF THE MA TTER HAD ALREADY BEEN AMPLY DISCUSSED AND THRESHED OUT BY THE SUPREME CO URT IN STATE OF PUNJAB VS. KAILASH NATH (SUPRA). IN FACT THE APEX COURT IN THE SAID CASE TOOK PAINS TO ENUMERATE AS TO MATTERS WHICH WOULD FALL WITHIN THE PURVIEW OF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 81 CONDITIONS OF SERVICE (SEE EXTRACT IN PARA 32). T HE MINISTRY WHICH HAS FILED THE AFFIDAVIT HAS STATED THAT THESE AMENDMEN TS ARE IN THE SPHERE OF CONDITIONS OF SERVICE. NOW WHEN ONCE IT IS STATED S O WHICH SHOULD STRICTLY FALL IN THE LIGHT WHAT COULD BE A CONDITION OF SERV ICE AS INTERPRETED BY THE SUPREME COURT IN THE CASE OF STATE OF M.P. VS. SHAR DUL SINGH (SUPRA); I.N. SUBBAREDDY VS. ANDRA UNIVERSITY; AND STATE OF PUNJA B VS. KAILASH NATH (SUPRA) IN OUR CONSIDERED OPINION RULE 13E CANNOT BE TREATED AS ONE FALLING WITHIN THE MEANING OF CONDITIONS OF SERVICE BUT GOI NG BEYOND IT. 82. WE AGREE WITH CONTENTION OF THE INTERVENER THAT THE LEGISLATURE CANNOT IGNORE THE MARCH OF EVENTS OVER A PERIOD OF TIME A ND THE RIGHTS ACCRUING AS A RESULT THEREOF. AFTER ALL NOTIFICATION OR THE LA W MUST SATISFY THE REQUIREMENTS OF CONSTITUTION TODAY TAKING INTO ACC OUNT THE ACCRUED OR ACQUIRED RIGHTS OF THE PARTIES AS ON THE DATE OF SU CH NOTIFICATION OR LEGISLATION. THAT WOULD BE MOST ARBITRARY UNREASON ABLE AND NEGATION OF HISTORY IF SUCH RECOGNITION IS NOT MADE AS OBSERVE D BY APEX COURT IN STATE OF GUJARAT VS. RAMAN LAI (SUPRA) AS ALSO IN P.D. AG ARWAL VS. STATE OF M.P. (SUPRA). 83. ANY HOW WE CAN DO NOTHING ABOUT THIS EXCEPT INTERPRET THE PROVISION AS IT IS SPELT OUT BY THE NOTIFICATION. WE ACCEPT THE PLEA MADE BY THE SR. CENTRAL GOVT. COUNSEL THAT RULE 13E BRINGS ABOUT AMENDMENTS TO THE CONDITIONS OF ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 82 SERVICE. THE NEXT QUESTION THAT IMMEDIATELY STRIKES TO US IS WHETHER IT CAN APPLY TO THE MEMBERS WHO ARE IN SERVICE NOW OR WHO ARE GOING TO JOIN THE SERVICE FROM NOW OR WHO WERE IN SERVICE EARLIER. BE FORE ANSWERING THAT ISSUE THE COMMON INTENTION AND PURPOSE IN BRINGING THE AMENDMENT TO SECTION 129(6) OF THE CUSTOMS ACT COULD HAVE BEEN C ARRIED OUT BY BRINGING LIKE AMENDMENTS IN THE INCOME-TAX ACT EITHER IN SEC TION 252 OR IN SECTION 288 OF THE INCOME-TAX ACT INSTEAD OF CHOOSING THE ROUTE OF AMENDING THE CONDITIONS OF SERVICE. 84. IN FACT THE LEGISLATURE IN SEC. 288 OF THE INCO ME-TAX ACT ITSELF HAD SUCH PROVISION U/S 288(3) WHICH PROVIDED AS UNDER (PRIOR TO ITS DELETION): (3) NOTWITHSTANDING ANYTHING CONTAINED IN THIS SEC TION IF THE AUTHORIZED REPRESENTATIVE IS A PERSON FORMERLY EMPLOYED AS AN INCOME-TAX AUTHORITY NOT BELOW THE RANK OF INCOME-TAX OFFICER AND HAS R ETIED OR RESIGNED FROM SUCH EMPLOYMENT AFTER HAVING SERVED FOR NOT LESS TH AN THREE YEARS IN ANY CAPACITY UNDER THIS ACT OR UNDER THE INDIAN INCOME- TAX ACT 1922 ( 11 OF 1922) FROM THE DATE OF HIS FIRST EMPLOYMENT AS SUC H HE SHALL NOT BE ENTITLED TO REPRESENT ANY ASSESSEE FOR A PERIOD OF TWO YEARS FROM THE DATE OF HIS RETIREMENT OR RESIGNATION AS THE CASE MAY BE. 85. THIS LEGISLATIVE PROVISION WAS DELETED BY THE T AXATION LAWS (AMENDMENT) ACT 1984 W.E.F. 1-10-1984. THAT MEANS WHEN THESE PROVISIONS WERE DELETED THE PARLIAMENT THOUGHT IN ITS WISDOM NOT TO BAR ANY SUCH PERSONS FROM PRACTICING BEFORE THE INCOME-TAX AUTHORITIES TO WHICH CATEGORY THEY ONCE BELONGED TO. IT MAY BE POINTED O UT AT THIS STAGE THAT THE VALIDITY OF THE SUB-SECTION WAS CHALLENGED BEFORE T HE PUNJAB & HARYANA HIGH COURT IN THE CASE OF KULWANT SINGH (SUPRA) WH ICH HELD THE PROVISION ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 83 TO BE CONSTITUTIONALLY VALID. STILL THE PARLIAMENT USED ITS HIGHER WISDOM TO DELETE SUB-SECTION (3) OF SECTION 288 OF THE I.T. ACT FROM THE STATUTE BY THE TAXATION LAWS AMENDMENT ACT 1984. THE LARGER PUBLI C INTEREST WHICH THE LEGISLATURE HAS ENVISAGED WHILE DROPPING THE PROVI SION THAT ALREADY EXISTED CANNOT MERIT IGNORANCE MERELY BECAUSE THE EXECUTIVE AUTHORITY FELT OTHERWISE PERHAPS WISER THAN THE HIGHER WISDOM OF THE PARLIAMENT. 86. AFTER HAVING REMOVED THOSE PROVISIONS THEY TRI ED TO ENFORCE SAME OBJECTIVE BY TAKING RECOURSE TO AMENDMENT IN PENSIO N RULES (A TYPE OF CONDITIONS OF SERVICE). THAT PIECE OF THE LEGISLATI ON WHICH WAS BROUGHT TO PENSION RULES AND WHICH PROHIBITED THE EMPLOYEES OF THE CENTRAL GOVERNMENT FROM APPEARING AND PRACTICING BEFORE TH E SAME INCOME TAX AUTHORITIES TO WHICH THEY BELONGED WHILE THEY WERE IN SERVICE WAS CHALLENGED BEFORE THE CAT AND THE CAT STRUCK DOWN T HE SAID PROVISION AS UNCONSTITUTIONAL AND INVALID. THE MATTER WENT TO TH E SUPREME COURT AND THE SUPREME COURT AFFIRMED THE VIEW OF THE CAT MEANING THEREBY THE LIMITED BAN IMPOSED UNDER RULE 11 OF THE CCS(PENSION) RULE S DENYING LIBERTY TO A RETIRED INCOME TAX OFFICER THE RIGHT TO PRACTICE I N PROFESSION WITHIN TWO YEARS OF RETIREMENT WAS HELD TO BE UNCONSTITUTIONAL AND INVALID [ R.KAPOOR VS. STATE OF HARYANA (SUPRA)]. AS A RESULT OF THIS LEGISLATIVE EXERCISE NOW IT IS DIFFICULT TO SAY THAT IDENTICAL PROVISION UNDER CONDITIONS OF SERVICE CAN STILL ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 84 PASS THE TEST OF VALIDITY IN THE EYES OF LAW. THIS INTERPRETATION RENDERED BY THE SUPREME COURT IN CONNECTION WITH CCS(PENSION) RULES CANNOT MERIT IGNORANCE OR BE SLIGHTED MERELY BECAUSE THE EXECUTI VES ATTEMPT IN BRINGING RULE 13E IS IN THE DIRECTION OF BRINGING SOME REFOR MATIVE PROVISIONS TO FREE THE JUDICIARY FROM THE CHARGES OF BIAS IN THEIR JUD ICIAL FUNCTIONS. THE EXECUTIVE IF PERMITTED IN THIS MANNER WILL ONLY SET NAUGHT THE JUDICIAL INTERPRETATION RENDERED BY THE HIGHEST COURT OF THE LAND AND ALSO BYPASS THE HIGHER WISDOM OF THE PARLIAMENT. WE MUST BE CONSCI OUS OF THE FACT THAT LIMITED BAN OF TWO YEARS ON RETIRED INCOME TAX EMPL OYEES WAS NOT APPROVED BY THE SUPREME COURT. NOW THE PRESENT NOTIFICATION UNDER THE GARB OF CONDITIONS OF SERVICE SEEKS TO ENFORCE A LIFE BAN OF EX-MEMBERS WILL IT RECEIVE A JUDICIAL SANCTION IN THE BACKGROUND OF R . KAPOORS CASE. IT IS DIFFICULT TO IMAGINE OR ACCEPT. NOW WE WILL BE ABLE TO APPRECIATE THE IMPORTANCE OF THE MEANS TO ENDS. THE PURPOSE OF SECTION 288(3) OF THE INCOME-TAX ACT AND RULE 11 OF THE PENSION RULES WAS TO ACHIEVE A COMMON OBJECTIVE AND TO ENSU RE THE SAME RESULT. AS IN OUR CASE SECTION 129(6) OF CUSTOMS ACT AND RULE 13E OF THE ITAT MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE ) RU LES 1963. BUT LOOK HOW THE JUDICIARY APPRECIATED THE DIFFERENCE. PUNJA B & HARYANA HIGH COURT IN THE CASE OF KULWANT SINGH (SUPRA) HAS HELD 288(3 ) AMENDMENTS ARE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 85 CONSTITUTIONALLY VALID. BUT RULE 11 OF THE PENSION RULES WAS HELD TO BE OTHERWISE BY SUPREME COURT IN R. KAPOORS CASE. EXA CTLY THEIR LORDSHIPS OF HIGH COURT IN P.C. JAINS CASE UPHELD THE VALIDITY OF SEC. 129(6) OF CUSTOMS ACT AS IT PROCEEDED ON THE BASIS THAT THE RIGHT TO PRACTICE IS NOT A CONDITION OF SERVICE BUT A LEGISLATIVE AMENDMENT TO CUSTOMS ACT. THE DIFFERENCE HAS BECOME APPARENT AND REVEALING AND CANNOT BE JUST O VERLOOKED. 87. IN THE LIGHT OF THIS BACKGROUND WE CANNOT SAY THAT THE RATIO LAID DOWN BY THE DELHI HIGH COURT IN THE CASE OF P.C. JAIN (S UPRA) SHOULD BE PLAINLY APPLIED TO THIS PIECE OF LEGISLATION WHICH BRINGS C ERTAIN AMENDMENTS IN THE CONDITIONS OF SERVICE AKIN TO CCS (PENSION) RULES. AGAIN WE GO BACK TO THE EARLIER QUESTION WHICH WAS BOTHERING US IF IT IS A CONDITION OF SERVICE AND WHETHER IT APPLIES TO THE MEMBERS WHO ARE IN SERVIC E OR WHO JOIN THE SERVICE FROM NOW OR IN RELATION TO PERSONS WHO WERE IN SER VICE EARLIER AND WHO ARE NOT IN SERVICE ON THE DATE OF NOTIFICATION. NOW WE FIRST LOOK TO THE PLAIN WORDS OF RULE 13E WHICH STATES THAT THE PRESIDENT SR. VICE PRESIDENT VICE PRESIDENTS AND MEMBERS OF THE TRIBUNAL SHALL NOT PR ACTICE BEFORE THE TRIBUNAL AFTER RETIREMENT FROM THE SERVICE OF THE T RIBUNAL. THAT MEANS IT CAN APPLY TO THE PERSONS WHO ARE PRESIDENT SR. VICE PR ESIDENT VICE PRESIDENTS AND MEMBERS ON THE DATE WHEN THE NOTIFICATION WAS I SSUED. THE AUTHORITIES RELIED UPON BY THE INTERVENERS HAS SHOWN THAT ALL A MENDMENTS AS TO THE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 86 CONDITIONS OF SERVICE CAN ONLY BE PROSPECTIVE AND I N THIS CASE THE NOTIFICATION ITSELF SAYS THAT IT IS PROSPECTIVE. TH E HITCH THAT NOW ENTERED OUR MINDS IS THAT INTERPRETATION IS THE DECISION OF THE APEX COURT IN THE CASE OF BISHUN NARAIN MISRA VS. THE STATE OF U.P. & OTHERS (SUPRA). THE APPELLANT IN THAT CASE WAS IN THE SERVICE OF STATE OF U.P. AS SUB-REGISTRAR. HE WAS BORN ON 11-12-1905 AND WAS RECRUITED IN SERVICE IN JULY 1933. AT THE TIME OF HIS RECRUITMENT THE AGE OF RETIREMENT (SUPERANNUATION) FOR GOVERNMENT SERVANTS OF HIS CLASS WAS 55 YEARS. NORMALLY HE SHOULD HAVE RETIRED ON 11-12-1960. BUT BY A NOTIFICATION DATED 27-11-1957 THE GOVERNM ENT RAISED THE AGE OF RETIREMENT TO 58 YEARS. THUS HE WOULD HAVE RETIRED ON 11-12-1963. ON 25-5- 1961 GOVERNMENT AGAIN REDUCED THE AGE OF RETIREMEN T TO 55 YEARS BY A NOTIFICATION OF THAT DATE ISSUED UNDER ART. 309 OF THE CONSTITUTION. BY SECOND NOTIFICATION OF THE SAME DATE THE GOVERNMENT ISSUED ORDER THE EFFECT OF WHICH WAS THAT ALL GOVERNMENT SERVANTS WHO WOULD HAVE RET IRED BECAUSE OF THE CHANGE IN THE AGE OF RETIREMENT AFTER 25.5.1961 AND BEFORE 20-12-1961 WERE RETAINED IN SERVICE UPTO 31-12-1961 EXCEPT THOSE WH O REACHED THE AGE OF 58 YEARS BEFORE 31-12-1961 IN WHICH CASE THEY WERE TO RETIRE AT THE AGE OF 58 YEARS. ACCORDINGLY BISHUN NARAIN MISHRA RETIED ON 3 1-12-1961.IT WAS ARGUED BY SHRI BISHUN NARAIN MISHRA THAT THE RULE I S RETROSPECTIVE AND NO RETROSPECTIVE RULE CAN BE MADE TO HIS DETRIMENT. TH E COURT DID NOT FIND ANY ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 87 RETROSPECTIVITY IN IT. ALL THAT THE RULE PROVIDES I S THAT FROM THE DATE IT COMES INTO FORCE THE AGE OF RETIREMENT WOULD BE 55 YEARS. IT WOULD THEREFORE APPLY FROM THAT DATE TO ALL GOVERNMENT SERVANTS EVEN THO UGH THEY MAY HAVE BEEN RECRUITED BEFORE MAY 25 1961 IN THE SAME WAY AS THE RULE OF 1957 WHICH INCREASED THE AGE FROM 55 YEARS TO 58 YEARS APPLIED TO ALL GOVERNMENT SERVANTS EVEN THOUGH THEY WERE RECRUITED BEFORE 195 7. NOW WE WILL TAKE A HYPOTHETICAL PROVISION AND THE SITUATION AND THE AN SWER BECOMES CLEAR. SUPPOSE INSTEAD OF AGE BEING REDUCED TO 55 SAY IT WAS INCREASED TO 70 YEARS. DOES IT MEAN THE EXECUTIVE APPLIES THE AMENDMENT TO THOSE RETIED JUST BEFORE WITHOUT CROSSING 70. WILL ALL OF THEM RECALL ED TO SERVE THE UNION TO THE AGE OF 70. THAT WILL SIMPLY BE OBNOXIOUS. IT NEVER HAPPENED WHEN THE AGE WAS JUST INCREASED FROM 55 TO 58. IT WILL NEVER HAP PEN NOW BECAUSE THE AMENDMENTS AS TO CONDITIONS OF SERVICE CAN ONLY APP LY TO THE PERSONS SERVING ON THE DATE OF AMENDMENT EVEN APPLYING THE PRINCIPLE LAID DOWN BY SUPREME COURT IN BISHNU NARAIAN MISHRA (SUPRA). THI S DECISION OF APEX COURT IN OUR OPINION HAS REPELLED THE CONTENTION OF THE INTERVENERS THAT THESE PROVISIONS ARE ONLY APPLICABLE TO THOSE WHO JOIN ITAT AFTER 3-6-2009. AT THE SAME TIME AS ALREADY EXPLAINED IT DOES NOT APPLY TO THOSE WHO HAVE ALREADY RETIRED PRIOR TO 3-6-2009. IT DOES NOT DIST URB THE HISTORICAL FACTS OR EVENTS THAT HAVE ALREADY HAPPENED BEFORE OR LONG TI ME BACK. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 88 88. THE MINISTRY HAS RESORTED TO ISSUANCE OF THE SA ID NOTIFICATION AS IT IS CLAIMED IN THE LARGER INTEREST OF THE ITAT. THEY DR EW REFERENCE TO THE DISCUSSION IN P.C. JAINS CASE TO SAY ALL THESE ARE IN THE DIRECTION OF REFORMATORY STEPS BROUGHT IN TO UPHOLD THE DIGNITY OF THE INSTITUTION TO FREE THIS INSTITUTION FROM CHARGES OF BIAS IN DISCHARGE OF ITS JUDICIAL FUNCTION. ENDS ARE SIMPLY LAUDABLE. BUT WE SHOULD SEE WHETHE R THE MEANS BY WHICH IT IS SOUGHT TO BE ACHIEVED STANDS THE TEST OF LAW LA ID DOWN AND EXPLAINED BY THE SUPREME COURT FROM TIME TO TIME IN RELATION TO ARTICLE 309 OF THE CONSTITUTION. NO DOUBT THE MINISTRY AS IT WERE BU ILT A NICE PALACE SO THAT ALL OF US IN THE ITAT COULD LEAD A HAPPY AND BLISSFUL LIFE HEREAFTER USED STRONG BRICKS GOOD CEMENT AND ISI MARKED STEEL BUT THEY B UILT IN OUR VIEW ON A LOOSE SOIL OR SANDY BED OR SAY WITHOUT TAKING ECOL OGICAL CLEARANCE. THE PALACE SO BUILT ALTHOUGH OF STRONG STRUCTURAL COMP ONENTS IS LIKELY TO CRUMBLE. THE SAME IS TRUE HERE. WE WERE VERY ANXIOU S TO APPLY THE RATIO LAID IN P.C. JAINS CASE (SUPRA) BUT REFRAINED OR SHOWN CAUTION BECAUSE THE BASE ON WHICH OUR PALACE IS BUILT IS DIFFERENT FROM THE ONE APPRECIATED BY THE DELHI HIGH COURT. WE CAN ONLY ACCEPT THE REALITY AN D ENVY OUR NEIGHBOURS IN THE CESTAT. 89. THE WORDS USED IN RULE 13E READ THAT THE PRESI DENT SR. VICE PRESIDENT VICE PRESIDENT AND THE MEMBERS OF THE TR IBUNAL SHALL NOT PRACTICE BEFORE THE TRIBUNAL AFTER THE RETIREMENT FROM THE S ERVICE OF THE TRIBUNAL. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 89 THAT MEANS IT CAN APPLY TO THOSE PERSONS WHO ARE TH E PRESIDENT SR. VICE PRESIDENT VICE PRESIDENTS AND THE MEMBERS ON THE D ATE WHEN THE NOTIFICATION WAS ISSUED. IN FACT RULE 13F WHICH WAS BROUGHT BY THE SAME AMENDMENT UNDER THE SAME PROVISO TO ARTICLE 309 PRO VIDES THAT THE SAME PERSONS WOULD NOT UNDERTAKE ANY ARBITRATION WORK W HILE FUNCTIONING IN THOSE CAPACITIES IN THE TRIBUNAL. THAT MEANS THOSE PERSONS CANNOT UNDERTAKE ANY ARBITRATION WORK WHILE WORKING IN THOSE CAPACI TIES OR UNDERTAKE TO PRACTICE BEFORE THE TRIBUNAL AFTER THEIR RETIREMENT FROM SERVICE FROM THE TRIBUNAL. THAT MEANS THESE SERVICE CONDITIONS WHI CH ARE BROUGHT INTO THE ITAT MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE ) RULES 1963 ADMITTEDLY CAN BE APPLIED ONLY TO THOSE PERSONS WHO ARE PRESENTLY PRESIDENT SR. VICE PRESIDENT VICE PRESIDENT OR THE MEMBERS O F THE TRIBUNAL. THEY ARE PERSONS WHO ARE PRESENTLY SERVING AND NOT TO THOSE PERSONS WHO HAVE LONG BACK RETIRED. AFTER ALL A PRESIDENT WHO HAS RETI RED CANNOT REMAIN TO BE THE PRESIDENT AFTER RETIREMENT. IN THE SAME MANNER WHO RETIRED AS SR. VICE PRESIDENT LONG BACK AS OF NOW CANNOT REMAIN TO BE T HE SR. VICE PRESIDENT. IN THE SAME MANNER WHO RETIRED AS VICE PRESIDENT LONG BACK CANNOT REMAIN VICE PRESIDENT FOR APPLYING THESE PROVISIONS AFTER HIS RETIREMENT. SIMILARLY A MEMBER WHO RETIED AS A MEMBER PRIOR TO THE INSERTIO N CANNOT BE ROPED IN TO BE AGAIN CALL A MEMBER TO WHOM THE SAID PROVISIONS ARE MADE APPLICABLE. IN OTHER WORDS THE PLAIN LANGUAGE EMPLOYED IN RULE 13 E AND 13F JOINTLY SUGGEST THAT IT ONLY APPLY TO THOSE PERSONS WHO WER E SERVING IN THAT CAPACITY ON 3-6-2009. THAT MEANS IT CAN ADMITTEDLY BE APPLIE D TO THOSE PERSONS WHO ARE IN SERVICE IN THOSE CAPACITIES AS ON 3-6-2009. TO ALL OF US IT DEFINITELY APPLIES AND ALL THE MEMBERS WHO WERE ON THE SERVICE ROLL/ ROASTER OF THE I.T.A.T. AS ON 3-6-2009 WHEN THESE ARE MADE APPLIC ABLE DEFINITELY SUFFER FROM THE PRESENT DISQUALIFICATION. IF IT IS TO BE T REATED AS CONDITION OF SERVICE. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 90 IN OUR UNDERSTANDING EVEN THE PLAIN READING OF THE PROVISION OF SECTION 13E INDICATES THAT IT CAN ONLY APPLY TO THE MEMBERS WHO HAVE RETIED AFTER 3-6- 2009. 90. BEFORE WE PART WITH THE MATTER THE PRESIDENT H AD SENT TWO REPRESENTATIONS RECEIVED FROM ITAT BAR ASSOCIATION MUMBAI AND ITAT BAR ASSOCIATION RAJASTHAN FOR CONSIDERATION OF THE SAME AS PER LAW. THEY STATED IN THE SAID REPRESENTATIONS THAT THEY SUPPORT THE NOTIFICATION BY THE MINISTRY IN THE LIGHT OF THE DECISION OF P.C. JAINS CASE. W E WOULD HAVE CERTAINLY APPRECIATED THEIR PERSONAL APPEARANCE AND ARGUMENTS . WE MUST SAY THAT NO LEGAL ISSUE CAN BE DECIDED ON THE BASIS OF SOME PER CEPTION OF THE MATTER IN ONE QUARTER OF THE SOCIETY. WE HAVE TO GO BY THE JU DICIAL INTERPRETATION THAT THE LAW ENACTED BY THE PARLIAMENT/ RULE MAKING AUTH ORITY HAS RECEIVED. IN THE LIGHT OF THE DISCUSSIONS MADE WE FEEL THAT WE HAVE DONE IT. AFTER ALL NO LAW CAN BE INTERPRETED IN A MANNER THAT PLEASES O NE SECTION OR TO ACHIEVE THE OBJECTS WHICH THEY FEEL IS RIGHT UNLESS THE LEG ISLATURE WANTS IT THAT WAY IN THE EXPRESSED LEGISLATION. 91. WE ARE NOT FOR THE MOMENT HOLDING ANYTHING ABOU T THE LEGISLATIVE COMPETENCE OF THE PRESIDENT TO MAKE THE RULES IN TH E MANNER IT IS DONE BUT WE HAVE ONLY INTERPRETED THE PROVISIONS THAT ARE M ADE AS PART OF CONDITIONS OF SERVICE AND FROM SUCH CONDITIONS OF SERVICE THE BAN ON RIGHT TO PRACTICE CAN ONLY BE MADE APPLICABLE TO THE EMPLOYEES WHO ARE PRESENTLY SERVING THE UNION OF INDIA OR IN CONNECTION WITH THE AFFAI RS OF THE STATE. IN OUR VIEW HAVING REGARD TO THE PRINCIPLE LAID DOWN IN T HE DECISIONS OF APEX COURT IN KAILASHNATH; P. MAHANDRAN; T.R. KAPUR KA ISHAV MADHAVAN MENON; R.S. AJARA & OTHERS; P.D. AGGARWAL & OTHERS CHAIRMAN CENTRAL BOARD (CITED SUPRA) WHICH HAVE BEEN DISCUSSED ELABORATELY WE ARE OF THE VIEW THAT THESE PROVISIO NS ARE APPLICABLE TO THOSE ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 91 PERSONS WHO RETIRED FROM THE SERVICE ON OR AFTER T HE DATE OF PUBLICATION OF THIS NOTIFICATION. 92. ACCORDINGLY IN THE LIGHT OF THE ABOVE DISCUSSI ON THE REFERENCE IS ANSWERED AS UNDER: (1) IN OUR VIEW IT DOES NOT APPLY TO MEMBERS WHO HAVE RETIRED PRIOR TO THE DATE OF PUBLICATION OF NOTIFICATION. (2) IN OUR VIEW THE QUESTION NO. 2 IS ANSWERED T O THE EFFECT THAT IT APPLIES TO THE MEMBERS WHO RETIRED FROM THE TRIBUN AL ON OR AFTER THE DATE OF THE PUBLICATION OF THIS NOTIFICATION. (3) THAT ONCE THE MEMBER RETIES AFTER THE DATE OF N OTIFICATION IT CERTAINLY APPLIES. IT DOES NOT MATTER WHEN THE MEMBERS WERE R ECRUITED. EVEN IT APPLIES TO THE MEMBERS WHO ARE RECRUITED PRIOR TO T HE DATE OF NOTIFICATION. CRUCIAL DATE MUST BE THE DATE OF RETI REMENT. IF IT IS AFTER 3 RD JUNE 2009 IT APPLIES. (4) QUESTION NO. 4 IS ANSWERED THAT THE MEMBERS WHO RETIRE ON OR AFTER 3-6-2009 EVEN IF OTHERWISE QUALIFIED TO PRACTICE U /S 288 OF THE ACT WOULD STILL BE DEBARRED TO APPEAR AND ARGUE BEFORE THE TRIBUNAL IN THE LIGHT OF RULE 13E OF THE ITAT MEMBERS (RECRUITMENT AND CONDITIONS OF SERVICE ) RULES 1963. (5) PERSONS WHO HAVE RESIGNED FROM SERVICE PRIOR TO THE DATE OF NOTIFICATION WITHOUT ANY RETIREMENT BENEFITS WOULD NOT BE COVERED BY THIS NOTIFICATION BECAUSE IT APPLIES TO THOSE PERS ONS WHO HAVE RETIRED AFTER THE DATE OF NOTIFICATION. (6) AS REGARDS QUESTION NO. (6) WE SAY THE NOTIFIC ATION DOES NOT APPLY TO MEMBERS WHO ARE APPOINTED ON A TEMPORARY BASIS AND RESIGN FROM SERVICE WITHOUT BEING CONFIRMED DURING PROBATIONARY PERIOD. ITA NO.3370/DEL/2008 M/S CONCEPT CREATIONS 92 92. ACCORDINGLY THE REFERENCE IS ANSWERED AS ABOVE . WITH THESE OBSERVATIONS WE REMIT THE APPEAL FILES BEFORE THE REGULAR DIVISION BENCH TO BE DISPOSED OFF IN ACCORDANCE WITH LAW AFTER GIVIN G BOTH THE PARTIES TO APPEAL AN OPPORTUNITY OF BEING HEARD. ORDER PRONOUNCED IN OPEN COURT ON 15-9-2009. SD/- ( G.E. VEERABHADRAPPA ) VICE PRESIDENT SD/- (C.L. SETHI ) JUDICIAL MEMBER SD/- ( K.D. RANJAN ) ACCOUNTANT MEMBER DATED: 15-09-2009. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR