INTERNATIONAL SCHOOL OF SOCIAL WELFARE HUMAN RESOURCES,PATNA V. ACIT,CIR-1, PATNA

MA 2/PAT/2025

AI Insights

The case involves the International School of Social Welfare Human Resources, which filed a Miscellaneous Application under section 254(2) of the Income Tax Act, 1961, challenging the Tribunal's earlier order regarding the validity of reassessment proceedings for the assessment year 2005-06. The Tribunal had previously upheld the reopening of the assessment by the Assessing Officer, despite the assessee's contention that no notice under section 143(2) was issued before the reassessment order. The Tribunal's decision was based on the grounds that the reassessment was initiated following the proper legal procedures and that the issues raised by the assessee were not subject to rectification under section 254(2) as they did not constitute mistakes apparent from the record.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 841205 (ITAT-PATNA)
• Duration Of Justice: 1 year(s) 1 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 24-02-2026
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 09-01-2025
• Other Referred Cases: Express Newspapers Ltd. v. DCIT [2010] 186 Taxman 111 (Mad.), CIT v. Suman Tea & Plywood Industries (P.) Ltd. [1997] 94 Taxman 305 (Cal.), Commissioner of Income-tax (IT-4), Mumbai vs. Reliance Telecom Ltd. [2021] 133 taxmann.com 41 (SC), Vrundavan Ginning and Oil Mill vs. Assistant Registrar/President [2021] 126 taxmann.com 227 (Gujarat), Spinacom India (P.) Ltd. vs. Commissioner of Income-tax-1 [2018] 97 taxmann.com 516 (SC), Principal Commissioner of Income-tax (Central) vs. Hitesh Ashok Vaswani [2023] 156 taxmann.com 200 (Gujarat)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Reassessment proceedings; Question of law; Reopening of assessment
• Section: 147; 148; 144; 12AA; 260A

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PATNA BENCH AT KOLKATA [Virtual Court] Before SHRI PRADIP KUMAR CHOUBEY, JUDICIAL MEMBER & SHRI RAKESH MISHRA, ACCOUNTANT MEMBER M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources Vs. ACIT, Cir-1, Patna (Appellant) (Respondent) PAN: AAATI1439B Appearances: Assessee represented by : N.K. Lal, CA. Department represented by : Manab Adak, JCIT. Date of concluding the hearing : 16-January-2026 Date of pronouncing the order : 24-February-2026 ORDER PER RAKESH MISHRA, ACCOUNTANT MEMBER: The instant Miscellaneous Application at the instance of the assessee u/s 254(2) of the Income Tax Act, 1961 is directed against the order of this Tribunal in ITA No. 119/PAT/2011, order dated 30.09.2024 pertaining to AY 2005-06. The chronology of the litigation is as under: Sr. No. Date Events 1. 31.10.2005 The assessee filed its return of income and its case was not selected for scrutiny assessment by issuance of a notice under section 143(2) of the Income Tax Act. 2. 18.01.2007 The ld. Assessing Officer had issued notice under section 148 of the Income Tax Printed from counselvise.com Page | 2 M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources. Act and initiated the proceeding under section 147. 3. 19.12.2007 The ld. Assessing Officer has passed the assessment order under section 144/147. 4. 16.01.2009 The ld. CIT(Appeals) has decided the appeal of the assessee against the assessment order dated 19.12.2007. The case of the assessee was that though ld. Assessing Officer has commenced the reassessment proceedings by issuance of a notice under section 148 but before passing the assessment order under section 144/147, the ld. Assessing Officer has not served a notice under section 143(2) of the Income Tax Act. Therefore, this assessment order is not sustainable. The ld. CIT(Appeals) has entertained this plea and quashed the assessment order. 5. 16.04.2009 The ld. Assessing Officer on the one hand filed an appeal against the order of the ld. CIT(Appeals) dated 16.01.2009 before the ITAT, which was registered as ITA No. 66/PAT/2009. On the other hand, he again issued notice under section 148 for the same reasons and reopened the assessment. 6. 29.12.2010 The ld. Assessing Officer has passed the second re-assessment order under section 144 read with section147. 7. 30.03.2010 The ITAT has dismissed the appeal of the Revenue filed against the first round of ld. CIT(Appeals)’s order dated 16.01.2009. ITAT has upheld the finding of the ld. CIT(Appeals) that since no notice under section 143(2) was issued by the ld. Assessing Officer, the assessment order passed under section 147 read with section 144 is not a valid assessment. 8. 07.09.2011 The ld. CIT(Appeals) quashed the second round of assessment order on the ground that there was no fresh information possessed by the ld. Assessing Officer. He has initiated the re-assessment proceeding qua the same set of reasoning, which attained finality upto the level of ITAT. Accordingly, ld. CIT(Appeals) has quashed this order. Dissatisfied with the order of ld. CIT(Appeals), Revenue filed an appeal bearing ITA No. 119/PAT/2011 and on receipt of notice, the assessee has filed Cross Objection bearing No. 1/PAT/2012. Printed from counselvise.com Page | 3 M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources. 9. 20.04.2015 The Tribunal has concluded the hearing and reserved the judgment. 10. 20.07.2015 The Tribunal has decided the appeal along with two more appeals bearing ITA Nos. 72/PAT/2011 & 99/PAT/2012. In these two appeals, the issue was whether registration under section 12AA ought to be granted to the assessee or not. Tribunal has allowed these appeals and held that the assessee deserves to be registered under section 12AA of the Income Tax Act. The Tribunal, however, in ITA No. 119/PAT/2011 has reversed the finding of ld. CIT(Appeals) and upheld the reopening of assessment. The Tribunal did not record any finding on the plea raised by the assessee in the Cross Objection. 11. 29.07.2015 The Tribunal found apparent errors in its order dated 20.07.2015 and suo motu exercised its powers for rectification of those errors and passed allegedly a Corrigendum whereby certain mistakes, which are nine in numbers, have been corrected. 12 23.08.2023 The Hon'ble Tribunal recalled the order of the Tribunal in ITA No. 119/PAT/2011 and CO No. 01/PAT/2012 and restored them to their original numbers for readjudication on merit. 13 30.09.2024 The Tribunal allowed the Revenue’s appeal and dismissed the cross objection filed by the assessee. Thus, to sum up, the assessee has filed this Miscellaneous Application against the order of the Tribunal dated 30.09.2024 on the following grounds which are summarised from the Miscellaneous Application as the entire application is descriptive and also argumentative in nature: i) There is no mention of the contentions made by either party, which ought to have been mentioned and this is a mistake apparent from the record and needs to be rectified. ii) Holding that second proviso to section 147 was not applicable as no appeal against additions made was pending before the CIT (A)/ITAT despite the Printed from counselvise.com Page | 4 M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources. fact that the same was undisputedly pending in appeal before the ITAT, is a mistake apparent from the record and requires rectification. 2. As regards the first issue of no mention of the contentions of the either party, the same does not tantamount to mistake apparent from record as the order is passed after hearing both the parties and the reasons for arriving at the conclusion have been mentioned in the order in which the order of the Ld. CIT(A) as well as the facts of the case have been considered. 3. As regards the second issue of pendency of appeal before the CIT(A)/Tribunal and the second proviso being applicable is concerned, the only ground raised was regarding the quashing of the notice u/s 148 of the Act in the first appeal and the subsequent reassessment proceeding. The common order dated 20.07.2015 of the Tribunal also contains the order in ITA No. 119/PAT/2011 and CO No. 01/PAT/2012 which had been recalled; however, in para 9 thereof (the Corrigendum dated 29.07.2015 only substituting numerals “143(2)” for the numerals “148(1)” at line 11 of para 9 page 12 of the order), it has been elaborately discussed that there was no adjudication qua the reasons recorded on the merits of the assessment in the appellate order of the Ld. CIT(A) dated 16.01.2009 quashing the assessment as framed, which stood upheld by the Tribunal, and the same was on the jurisdictional issue only and the Ld. AO as the assessing authority was fully competent to initiate fresh proceeding u/s 147 of the Act after observing the due process of law and which he had done. The sub-section (2) and second proviso to section u/s 148 of the Act are reproduced as under: “148(2) The return of income required under sub-section (1) shall be furnished in such form and verified in such manner and setting forth such other particulars, as may be prescribed, and the provisions of this Act shall, Printed from counselvise.com Page | 5 M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources. apply accordingly as if such return were a return required to be furnished under section 139: Provided that any return of income required under sub-section (1), furnished after the expiry of the period specified in the notice under the said sub- section, shall not be deemed to be a return under section 139. Provided also that the Assessing Officer may assess or reassess such income, other than the income involving matters which are the subject matters of any appeal, reference or revision, which is chargeable to tax and has escaped assessment.” 3.1 Since the grounds on which the additions were made were never adjudicated nor decided by the Ld. CIT(A) as the order was quashed only on the non-issue of notice u/s 143(2) of the Act, therefore the reasons for reopening were never the subject matter of the appeal. Further, on the date of initiation of second reassessment proceeding on 16.04.2009, the proceeding initiated vide the notice u/s 148 of the Act dated 18.01.2007 stood quashed on 16.01.2009 by the Ld. CIT(A) on account of non-service of the notice. It is the assessee which challenges the merits before the Ld. CIT(A) and not the Revenue. Therefore, the other reasons mentioned that the additions were also the subject matter of the appeal is devoid of merits and this issue is also dismissed. 4. It would not be incongruous to reproduce the provisions of section 254(2) of the Act which are as under: “(2) The Appellate Tribunal may, at any time within six months from the end of the month in which the order was passed, with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub- section (1), and shall make such amendment if the mistake is brought to its notice by the assessee or the Assessing Officer: Provided that an amendment which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this sub-section unless the Appellate Tribunal has given notice to the assessee of its intention to do so and has allowed the assessee a reasonable opportunity of being heard: Printed from counselvise.com Page | 6 M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources. Provided further that any application filed by the assessee in this sub- section on or after the 1st day of October, 1998, shall be accompanied by a fee of fifty rupees. 5. As regards the ‘mistake apparent from record’, this issue is settled in the case of Express Newspapers Ltd. v. DCIT [2010] 186 Taxman 111 (Mad.) wherein it is held that 'Mistake' in general means to take or understand wrongly or inaccurately; to make an error in interpreting: it is an error, a fault, a misunderstanding, a misconception. Mistake in taxation laws has a special significance. It is mostly subjective and the dividing line is thin and indiscernible. 'Apparent' means visible, capable of being seen, easily seen, obvious plain, open to view, evident, appears, appearing as real and true, conspicuous, manifest, seeming. The plain meaning of the word 'apparent' is that it must be something which appears to be ex-facie and incapable of argument and debate. If such a mistake apparent on the face of record' is brought to the notice, section 254(2) empowers the Tribunal to amend the order passed u/s 254(1). 5.1 In CIT v. Suman Tea & Plywood Industries (P.) Ltd. [1997] 94 Taxman 305 (Cal.) also it has been held that the expression 'mistake apparent on the record', it is well-settled, means a mistake either clerical or grammatical or arithmetical or of like nature, which can be detected without there being any necessity to re-argue the matter or to re-appraise the facts as appearing from the records. Further, in the case of Commissioner of Income-tax (IT-4), Mumbai vs. Reliance Telecom Ltd. [2021] 133 taxmann.com 41 (SC) it is held that while considering application under section 254(2), Tribunal was not required to re-visit its original order and go in details on merits and completely recall its order as powers under provision of section 254(2) were only to rectify/correct any mistake apparent from record. It has also been held Printed from counselvise.com Page | 7 M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources. in the case of Principal Commissioner of Income-tax (Central) vs. Hitesh Ashok Vaswani [2023] 156 taxmann.com 200 (Gujarat) that the mistake to be rectified has to be apparent from face of record and not one where an extensive delving into arguments and a re-look can be sought on questions decided on merits. Where a detailed order has been passed by Tribunal, no rectification can be made on ground that order passed by Tribunal was erroneous either on facts or in law as in that case only remedy was to prefer an appeal. It was further held that since in instant case it was evident on considering decision of Tribunal in appellate proceedings that issues were examined threadbare on merits considering case laws, same could not be a subject matter of rectification merely because, according to revenue, issues had been decided by misinterpretation of facts and law. Further, in Vrundavan Ginning and Oil Mill vs. Assistant Registrar/President [2021] 126 taxmann.com 227 (Gujarat), it has been held that the power to rectify an order under section 254(2) is extremely limited and it does not extend to correcting errors of law or re-appreciating factual findings and those properly fall within appellate review of an order of Court of first instance and what legitimately falls for consideration are errors (mistakes) apparent from record. It has also been held in Spinacom India (P.) Ltd. vs. Commissioner of Income-tax-1 [2018] 97 taxmann.com 516 (SC) that an application under section 254(2) is for rectifying 'mistakes apparent from record' which is much narrower in scope than an appeal under section 260A where an order of Tribunal can be challenged on substantial question of law. 6. Thus, since there is no mistake apparent from the record as the mistake has to be palpably discernible and should not be drawn out Printed from counselvise.com Page | 8 M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources. after lengthy arguments, and only a mistake apparent from the record is so rectifiable u/s 254(2) of the Act, therefore, the Miscellaneous Application being devoid of merits is hereby dismissed. 7. In the result, the Miscellaneous Application filed by the assessee is dismissed. Order pronounced in the open Court on 24th February, 2026. Sd/- Sd/- [Pradip Kumar Choubey] [Rakesh Mishra] Judicial Member Accountant Member Dated: 24.02.2026 Bidhan (Sr. P.S.) Printed from counselvise.com Page | 9 M.A. No.: 2/PAT/2025 Arising out of I.T.A. No.: 119/PAT/2011 Assessment Year: 2005-06 International School of Social Welfare Human Resources. Copy of the order forwarded to: 1. International School of Social Welfare Human Resources, 61, South New Patliputra Colony, Patna, Bihar, 800001. 2. ACIT, Cir-1, Patna. 3. CIT(A)- 4. CIT- 5. CIT(DR), Patna Bench, Patna. 6. Guard File. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata Printed from counselvise.com "