Case: THE COMMISSIONER OF INCOME TAX CENTRAL-I, KANPUR Vs. SUBRATA ROY

4. A perusal of the judgment and order dated 27th August, 2013 disposing of the appeals would go to show that the said order is not an ex parte order. This would be evident from a mere reading of the order dated 27th August, 2013, the relevant part whereof is extracted herein below:On the other hand, Sri Wasqudeen Ahmed, learned counsel for the assessee has justified the impugned order passed by the Tribunal. He submits that the whole approach of the AO is incorrect as the AO has accepted that the loans taken by the assessee were invested and purchased in the share. The entire observation of the AO are based only on surmise and conjectures and hypotheses and on the basis of the imaginary and illusionary, which cannot be found as basis for rejecting the assessees claim for payment of interest. The case of the assessee is fully covered by the judgment of the Honble Apex Court in the Moodys case (supra). He mentioned on 02.01.2000, an advertisement was published in the Times of India by Sahara India Parivar, in which, it was stated that all the Directors have taken an oath neither they nor their family members can ever share the profit or assets of the company. But the assessment will have to be completed as per the provisions contained in the Income Tax Act and not on the basis of any statement or advertisement published here and there.Learned counsel further submits that the assessee took the loan from M/s Sahara India Mutual Benefits Co. Ltd. (SIMBCL) and claimed payment of interest to the said company. Such interest had been declared by the said company in its income. A person will not take investment in share just to throw away his money unless and until he has a hope to earn an income from such investment. Whether the investment is bad investment or a good investment depends upon the study of the person making the investment in the performance of the company.It may be noticed that the companies giving outstanding performance go out of the market and the companies performing not so well tends to start showing better results. Lastly, he submits that in view of the judgment of the Honble Apex Court in the case of Moody (supra), the interest in shares has to be allowed on the borrowed funds. So, he made a request that the appeals may kindly be dismissed.5. The participation of the assessee in the hearing of the appeals is also evident from various other parts of the order dated 27th August, 2013 which however need not be extracted in the present order.

Reasoning:
7. We have considered the aforesaid submissions. The question is one of availability of jurisdiction under Order XLI rule 21 of the CPC, namely, that the order passed in the appeal is an ex parte order. Not only the said order dated 27th August, 2013 is not an ex parte order as contemplated by the provisions of the Code of Civil Procedure, 1908, the final order dated 27th August, 2013 passed by the High Court clearly contains findings (extracted above) which is to the contrary. In these circumstances, we are of the view that the High Court did not have the jurisdiction under Order XLI rule 21 CPC to recall the final order dated 27th August, 2013 passed in the Income Tax Appeals. The power available under Order XLI rule 21 is hedged by certain pre-conditions and unless the pre-conditions are satisfied the power thereunder cannot be exercised.