ITO, CHENNAI V. M/s. Ranjani Enterprises Pvt. Ltd., CHENNAI

ITA 2057/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7360 (ITAT-CHENNAI)
• Duration Of Justice: 8 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2017
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 03-01-2017
• Assessment Year: 2001-2002
• Appeal Filed On: 05-07-2016
• Court: TRIBUNAL
• Department Lawyers: SUPRIYO PAL
• Assessee Lawyers: R SIVARAMAN
• Keywords: Rectification of order; Principle of natural justice; Condonation of delay; Revised return
• Section: 147; 154

Judgement Text

, , IN THE INCOME - TAX APPELLATE TRIBUNAL B BENCH, CHENNAI , . , BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY , JUDICIAL MEMBER ./ I T.A. NO. 2 0 5 7 /MDS/201 6 / ASSESSMENT YEAR :20 0 1 - 02 THE INCOME TAX OFFICER , CO MPANY WARD 5(4) , CHENNAI 600 034 . VS. M/S. RANJANI ENTERPRISES PVT. LTD., NEW NO. 11, OLD NO. 7, VISWANATHAN STREET, R.A. PURA M, CHENNAI 600 028. [PAN: AA B C R7941P ] ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI S UPRIYO PAL , J CIT / RESPONDENT BY : SHRI R. SIVARAMAN , A DVOCATE / DATE OF HEARI NG : 0 3 . 0 1 .201 7 / DATE OF P RONOUNCEMENT : 30 . 0 3 .201 7 / O R D E R PER DUVVURU RL REDDY , JUDICIAL MEMBER : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) 3 , CHE NNAI DATED 2 2 . 0 3 .201 6 RELEVANT TO THE ASSESSMENT YEAR 20 0 1 - 0 2 . THE REVENUE HAS RAISED THE FOLLOWING GROUND S: 1. THE ORDER OF THE LD. COMMISSIONER OF INCOME - TAX (APPEALS) IS CONTRARY TO LAW AND FACTS OF THE CASE. 2. THE LD. CIT(A) HAS ERRED IN DIRECTIN G THE AO TO RECTIFY THE MISTAKE IN ACCORDANCE WITH THE RATIO LAID DOWN BY HON'BLE I.T.A. NO . 2 0 5 7 /M/ 16 2 SUPREME COURT IN THE CASE OF BILAHARI INVESTMENTS LTD WHICH IS NOT A CONFORMITY WITH THE PROVISIONS OF SECTION 154. 3. THE LD.CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE FILED THE ORIGINAL RETURN OF INCOME BY DECLARING INCOME UNDER COMPLETED CONTRACT METHOD WHICH IS CONTRARY TO THE METHOD ADVOCATED BY THE HIGH CURT SUBSEQUENTLY AFFIRMED BY THE HON'BLE SUPREME COURT. 4. THE LD.CIT(A) OUGHT TO HAVE NOTED THAT AFTER 01.06 .2001, AO DOES NOT HAVE THE POWER TO VARY INCOME RETURNED IN A PROCEEDING U/S.143(1). HE OUGHT TO HAVE NOTED THAT WHEN AO DOES NOT HAVE THE JURISDICTION TO DO SO U/S.143(1), HE CANNOT DO SO IN A PETITION U/S.154 TO THE SAID ORDER U/S.143(1). 5. HAVING R EGARD TO THE HON'BLE SUPREME COURT DECISION IN THE CASE OF M/S. GEOTZE INDIA, THE LD.CIT(A) OUGHT TO HAVE APPRECIATED THAT WHEN THE CLAIM OF THE ASSESSEE WAS NOT MADE THROUGH A REVISED RETURN OF INCOME, THE CLAIM CANNOT BE ENTERTAINED. 6. FOR THESE AND OTHER GROUNDS THAT MAY BE ADDUCED AT THE TIME OF HEARING, IT IS PRAYED THAT THE ORDER OF THE COMMISSIONER OF INCOME - TAX (APPEALS) MAY PLEASE BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 2. T HE APPEAL OF THE REVENUE IS FOUND TO HAVE BEEN FILED LATE BY ONE DAY BEFORE THE TRIBUNAL. THE ASSESSING OFFICER HAS FILED AN AFFIDAVIT FOR CONDONATION OF DELAY BY STATING THAT THE RECORDS OF THE CASES WAS INADVERTENTLY GOT MIXED UP WITH SCRUTINY FILES AND THEREFORE COULD NOT FILE THE APPEAL WITHIN TIM E. THE LD. DR, CITING THE REASONS AS STATED BY THE ASSESSING OFFICER, REQUESTED FOR CONDONING THE DELAY AND TO ADMIT THE APPEAL FOR HEARING. THE LD. COUNSEL FOR THE ASSESSEE DID NOT OBJECT TO THE SUBMISSIONS OF THE LD. DR AND THUS, WE CONDONE THE DELAY OF ONE DAY IN FILING THE APPEALS AND ADMIT THE APPEAL FOR HEARING. I.T.A. NO . 2 0 5 7 /M/ 16 3 3 . M/S. RANJANI INVESTMENTS PRIVATE LIMITED (THE A SSESSEE) (NOW KNOWN AS M/S . RANJANI ENTERPRISES PRIVATE LIMITED) FILED ITS RETURN OF INCOME ON 29.10.2001 RETURNING A LOSS OF .1,03,42,597/ - . THE RETURN OF INCOME WAS PROCESSED U NDER SECTION 143( 1) OF THE INCOME TAX ACT, 1961 [ ACT IN SHORT] ) ON 08.07.2002 DETERMINING THE TOTAL LOSS AS .1,03,42,597/ - . SUBSEQUENTLY, ON 09.03.2007, THE A SSESSEE FILED A PETITION U NDER SECTION 154 OF THE ACT STA TING, THAT F OR THE ASSESSMENT YEAR 2001 - 02, SINCE THE RETURN FILED IS ON THE BASIS OF COMPLETED CONTRACT METHOD, AND THE METHOD APPROVED BY THE HIGH COURT IS DIFFERENT , THE INTIMATION U NDER SECTION 143(1)(A) ISSUED ON 08.07.2002 HAS TO BE REVISED TO FOLLOW THE METHOD APPROVED BY THE HIGH COURT. THE ASSESSING OFFICER , VIDE ORDER UNDER SECTION 154 OF THE ACT DATED 31.05.2007 , STATED THAT THE ASSESSEE'S REQUEST FOR RECTIFICATION U NDER SECTION 154 CANNOT BE CONSIDERED AS IT IS NOT A MISTAKE WHICH IS APPARENT FR OM THE RECORD. ON APPEAL, BY ACCEPTING ASSESSEE S PETITION 154 AND 155 (4) DATED 09.03.2007 , VIDE ORDER DATED 12.04.2011 , THE LD. CIT(A) DIRECTED THE ASSESSING OFFICER TO ARRIVE AT THE INCOME /LOSS OF THE YEAR BY FOLLOWING THE METHOD PRESCRIBED BY THE HIGH COURT AND ALSO DETERMINE THE LOSS OF EARLIER YEARS TO BE CARRIED FORWARD'. ON FURTHER APPEAL BY THE DEPARTMENT BEFORE THE ITAT, THE TRIBUNAL, VIDE ORDER IN ITA NO. 1272/MDS/2011 DATED 29.06.2012 RESTORED THE ISSUE BACK TO THE FILE OF THE ASSESSING OFFICER FOR ADJUDICATION AFRESH . I.T.A. NO . 2 0 5 7 /M/ 16 4 3 .1 IN VIEW OF THE ABOVE DIRECTIONS OF THE TRIBUNAL, AN OPPORTUNITY WAS GIVEN TO THE ASSESSEE TO PRESENT ITS CASE BEFORE THE ASSESSING OFFICER AND THE A SSESSEE , VIDE ITS LETTER DATED 28.01.2014 , REITERATED ITS EARLIER SUBMISSION S. CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND T AKING INTO ACCOUNT THE FACTS OF THE CASE, THE ASSESSING OFFICER HAS FINALIZED THE INSTANT PROCEEDING AS UNDER: - THE ASSESSEE FILED THE RETURN OF INCOME BY DECLARING INCOME UNDER COMPLETED CONTRACT METHO D WHICH IS CONTRARY TO THE METHOD ADVOCATED BY THE HIGH COURT SUBSEQUENTLY AFFIRMED BY THE HON'BLE SUPREME COURT. IN THE INSTANT CASE PROCESSING U/S. 143(1) WAS COMPLETED ON 08.07.2002. THE ASSESSING OFFICER DOES NOT HAVE A POWER TO RE - COMPUTE THE INCO ME OF THE ASSESSEE U/S. 143(1) EXCEPT HAVE ARITHMETICAL ERROR OR INCORRECT CLAIM APPARENT FROM THE INFORMATION FROM THE INCOME. THEREFORE, U/S. 154 THE ASSESSING OFFICER DID NOT HAVE A POWER TO RECTIFY AN INTIMATION PASSED U/S. 143(1) OF THE ACT. IT IS T O BE NOTED THAT WHEN THE ASSESSING OFFICER DOES NOT HAVE THE JURISDICTION U/S. 143(1) HE CANNOT DO SO IN A PETITION U/S. 154 TO THE SAID ORDER U/S. 143(1). IN THE CASE OF M/S. CHOICE AQUACULTURE PRIVATE LIMITED VS. ITO (2006) 100 ITD 143 (ITAT AHME D ABAD I T WAS HELD THAT, '.. THE CUMULATIVE EFFECT OF THE NEWLY SUBSTITUTED SECTION 143(1) AND OMISSION WITH EFFECT FROM 01.06.1999 OF SECTION 143(LA), 143(LB) AND 143(5) IS THAT NEITHER ANY PRIMA FACIE ADJUSTMENT CAN BE MADE NOR ANY LEVY OF ADDITIONAL INCOME TAX CAN BE MADE ON OR AFTER 01.06.1999. THUS, THE POWERS OF THE ASSESSING OFFICER UNDER THIS SECTION ARE VERY LIMITED AND RESTRICTED ONLY TO THE RETURN OF INCOME FILED BY THE ASSESSEE ... THE PROPOSITION OF LAW IS WELL SETTLED THAT WHAT CANNOT BE DONE 'PER DIR ECTUM' IS NOT PERMISSIBLE TO BE DONE 'PER OBLIQUUM' .. ', FURTHER, RELIANCE IS PLACED ON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LIMITED VS. CIT (284 ITR 323) I.T.A. NO . 2 0 5 7 /M/ 16 5 WHERE IT WAS HELD THAT AN ASSESSEE CANNOT AMEND A RETURN FOR MA KING A CLAIM FOR DEDUCTION OTHER THAN BY FILING A REVISED RETURN. THUS THE RECTIFICATION CLAIM MADE BY THE ASSESSEE IN THE INSTANT CASE IS NOT ACCEPTED. IN VIEW OF THE ABOVE, IT IS HELD THAT THE ISSUE SOUGHT TO BE RECTIFIED BY THE ASSESSEE IS NOT A MISTA KE APPARENT FROM RECORD. SINCE, IT IS BEYOND THE SCOPE OF RECTIFICATION U/S. 154 R.W.S. 155(4) OF THE ACT. 4 . AGAINST THE ABOVE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). AFTER CONSIDERING THE SUBMI SSIONS OF THE ASSESSEE, THE LD. CIT(A) HAS OBSERVED AS UNDER: I HAVE CONSIDERED SUBMISSIONS OF THE AR OF THE APPELLANT, FINDINGS OF THE AO AND MATERIAL ON RECORD. MAIN CONTENTION OF THE AR OF THE APPELLANT IS THAT HON'BLE MADRAS HIGH COURT HAS HELD IN ONE OF ITS GROUP COMPANIES NAMELY BILAHARI INVESTMENT PVT . LTD. THAT CHIT DIVIDEND IS TO BE TAXED IN THE YEAR OF ACCRUAL AS ALSO CHIT DISCOUNT SHOULD BE ALLOWED IN FULL IN THE YEAR OF ACCRUAL ITSELF. THIS VIEW OF HON'BLE HIGH COURT HAS BEEN UPHELD BY HON'BLE SUPREME COURT. NOW THE CONTROVERSY ON THIS ISSUE OF TAXING CHIT DIVIDEND AND ALLOWING CHIT DISCOUNT HAS BEEN SETTLED. THIS BEING THE CASE, FOR THE AY ON HAND APPELLANT HAD FILED APPLICATION U/S. 154 TO RECTIFY THE ISSUE IN ACCORDANCE WITH THE RATIO LAID DO WN BY HON'BLE SUPREME COURT. HOWEVER, AO HAS REJECTED APPELLANT'S APPLICATION FILED U/S.154 STATING THE SAID APPLICATION FILED BEYOND TIME LIMIT AO HAS NO POWER TO RECOMPUTED THE INCOME OF THE ASSESSEE U/S. 143(1), IT IS NOT MISTAKE APPARENT FROM RECORD AN D APPELLANT CANNOT MAKE A CLAIM WITHOUT FILING REVISED RETURN ETC. IN MY OPINION SECTION 154 STATES THAT AO CAN AMEND ANY ORDER PASSED BY HIM UNDER THE PROVISIONS OF INCOME TAX ACT, AMEND ANY INTIMATION OR DEEMED INTIMATION UNDER SUB SECTION 1 OF SECTION 1 43. APPELLANT'S REQUEST TO RECTIFY ITS STAND IN ACCORDANCE WITH RATIO OF APEX COURT WILL DEFINITELY FALL WITHIN THE SECTION 154. THEREFORE, AO IS DIRECTED TO RECTIFY THE MISTAKE APPARENT FROM RECORD IN ACCORDANCE WITH RATION LAID DOWN BY HON'BLE SUPREME CO URT IN THE CASE OF BILAHARI INVESTMENT PVT. LTD ,CIVIL APPEAL NO.1625 OF 2008 DATED 27.02.2008, ALL THE GROUNDS TAKEN BY THE APPELLANT ON THIS ISSUE ARE ALLOWED. 5 . ON BEING AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. THE LD. DR HAS SUBMIT TED THAT THE ASSESSEE FILED THE ORIGINAL RETURN OF INCOME BY DECLARING INCOME UNDER COMPLETED CONTRACT METHOD WHICH WAS CONTRARY TO THE METHOD ADVOCATED BY THE HON BLE HIGH COURT, SUBSEQUENTLY I.T.A. NO . 2 0 5 7 /M/ 16 6 AFFIRMED BY THE HON BLE SUPREME COURT. THEREFORE, IT CANNOT BE HELD THERE IS MISTAKE APPARENT ON RECORD AND THE ASSESSING OFFICER IS REQUIRED TO RECTIFY SUCH MISTAKE UNDER SECTION 154 OF THE ACT. THUS, THE LD. CIT(A) CANNOT DIRECT THE ASSESSING OFFICER TO RECTIFY SUCH MISTAKE, WHICH WAS NOT APPARENT ON RECORD UNDER SE CTION 154 OF THE ACT AND PLEADED THAT THE ORDER PASSED BY THE LD. CIT(A) SHOULD BE REVERSED. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE STRONGLY SUPPORTED THE ORDER PASSED BY THE LD. CIT(A). 6 . WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIAL S AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. THE ASSESSEE IS A PRIVATE LIMITED COMPANY SUBSCRIBING TO CHITS AS ITS BUSINESS ACTIVITY. IT IS MAINTAINING ITS ACCOUNTS ON MERCANTILE BASIS, AND COMPUTING LOSS OR PROFIT, AS THE CASE M AY BE, AT THE END OF THE CHIT PERIOD IN RESPECT OF CHITS TERMINATING IN A PARTICULAR PREVIOUS YEAR FOLLOWING THE COMPLETED CONTRACTS METHOD. THIS METHOD WAS FOLLOWED RIGHT FROM THE INCORPORATION OF THE COMPANY. FOR THE ASSESSMENT YEAR 2001 - 02 ALSO, FOLLOWI NG THE SAME COMPLETED CONTRACT METHOD, THE ASSESSEE FILED A RETURN DECLARING A LOSS OF .1,03,42,597/ - AND THIS WAS ACCEPTED BY THE ASSESSING OFFICER IN HIS INTIMATION U/S.143(1)(A) DATED 08.07.02. FOR THE ASSESSMENT YEARS 90 - 91; 91 - 92; AND 93 - 94, THE ASSE SSING OFFICER HAD HELD THAT THE COMPLETED CONTRACT METHOD FOLLOWED BY THE APPELLANT IS NOT THE CORRECT METHOD TO ASCERTAIN THE ASSESSABLE INCOME. HE HELD THAT CHIT DIVIDEND RECEIVED HAS TO BE TAXED IN I.T.A. NO . 2 0 5 7 /M/ 16 7 THE YEAR OF RECEIPT AND CHIT LOSS HAS TO BE ALLOWED ON PROPORTIONATE TIME BASIS BY DISTRIBUTING IT OVER THE PERIOD REMAINING SUBSEQUENT TO BID AUCTION. THIS WAS DISPUTED BY THE ASSESSEE AND WAS SUBJECT MATTER OF LITIGATION UPTO SUPREME COURT. THE HON'BLE MADRAS HIGH COURT IN ITS ORDER DATED 19.06.2006, HELD TH AT THE DIVIDEND INCOME HAS TO BE TAXED IN THE YEAR IT ACCRUED AND THAT THE CHIT LOSS SHOULD BE ALLOWED IN THE YEAR OF ITS ACCRUAL. THUS WHILE THE ASSESSING OFFICER'S METHOD WAS APPROVED IN ASSESSING DIVIDEND INCOME, THE APPELLANT'S METHOD WAS APPROVED IN R ESPECT OF CHIT LOSS. ON FURTHER APPEAL, BY THE DEPARTMENT, THE HON'BLE SUPREME COURT, BY ITS ORDER DATED 27.02.08, CONFIRMED THE DECISION OF THE HON'BLE HIGH COURT CHENNAI. THUS, THE DISPUTE REGARDING METHOD OF ACCOUNTING REACHED ITS FINALITY ON 27.02.08. BEFORE PASSING ITS ORDER BY THE HON BLE MADRAS HIGH COURT, THE ASSESSMENTS FOR 1998 - 99; 1999 - 2000 & 2000 - 2001 WERE REOPENED BY THE A SSESSING O FFICER U NDER SECTION 147 OF THE ACT . THE REASSESSMENTS FOR THESE YEARS WERE COMPLETED ON 28.12.2006 AFTER THE HIG H COURT'S ORDER DATED 19.06.06. IN THESE ASSESSMENTS, INCOME/LOSS C OMPUTATION WAS DONE ON THE BASIS OF METHOD OF ACCOUNTING APPROVED BY THE HIGH COURT. THE A SSESSEE FELT THAT FOR THE ASSESSMENT YEAR 2001 - 02 WHERE THE COMPUTATION OF INCOME HAD BEEN DONE UND ER COMPLETED CONTRACT METHOD AND ACCEPTED IN THE INTIMATION 143 (L)(A) DATED 08.07.02 HAS BECOME INCORRECT IN VIEW OF THE METHOD FORMULATED BY THE HIGH COURT AND CONFIRMED BY THE SUPREME COURT. IN VIEW OF THIS THE A SSESSEE FILED A PETITION BEFORE THE I.T.A. NO . 2 0 5 7 /M/ 16 8 A SSES SING O FFICER ON 09.03.2007 SEEKING RECTIFICATION OF THE INTIMATION U NDER SECTION 143(1)(A) DATED 08.07.02 TO COMPUTE THE INCOME ON THE BASIS OF THE METHOD FORMULATED BY THE HIGH COURT. THE APPLICATION WAS FILED INVOKING THE PROVISIONS OF SEC.154 AND SEC.15 5 (4) OF THE ACT. THIS APPLICATION WAS REJECTED BY THE A SSESSING O FFICER IN HIS LETTER DATED 31.05.07 BY STATING THAT YOUR REQUEST FOR RECTIFICATION U/S 154 CANNOT BE CONSIDERED AS IT IS NOT A MISTAKE WHICH IS APPARENT FROM RECORD. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND BY FOLLOWING VARIOUS DECISIONS, THE LD. CIT(A) HAS OBSERVED THAT NON CONSIDERATION OF A DECISION OF JURISDICTIONAL HIGH COURT AND SUPREME COURT CAN BE SAID TO BE A MISTAKE APPARENT FROM RECORD AND THEREFORE, HE HELD THAT THE RE IS MISTAKE APPARENT FROM RECORD IN THE INTIMATION UNDER SECTION 143(1) OF THE ACT DATED 08.07.02 WHICH NEEDS TO BE RECTIFIED . ACCORDINGLY, THE LD. CIT(A) ALLOWED THE ASSESSEE S PETITION UNDER SECTION 154 & 155(4) OF THE ACT DATED 09.03.2007 AND DIRECTED THE ASSESSING OFFICER TO ARRIVE AT THE INCOME/LOSS OF THE YEAR BY FOLLOWING THE METHOD PRESCRIBED BY THE HIGH COURT AND ALSO DETERMINE THE LOSS OF EARLIER YEARS TO BE CARRIED FORWARD. ON FURTHER APPEAL BY THE DEPARTMENT, THE TRIBUNAL VIDE ITS ORDER IN I. T.A. NO. 1272/MDS/2011 DATED 29.06.2012 REMITTED THE MATTER BACK TO THE FILE OF ASSESSING OFFICER FOR FRESH CONSIDERATION. HOWEVER, IN THE SECOND ROUND OF LITIGATION, WITHOUT RECORDING THE REASONS THAT NO MISTAKE IS APPARENT ON RECORD, THE ASSESSING OFFICE R PASSED HIS ORDER BY REJECTING THE SUBMISSIONS OF THE ASSESSEE ONLY ON THE GROUND THAT THE APPLICATION FILED I.T.A. NO . 2 0 5 7 /M/ 16 9 UNDER SECTION 154 OF THE ACT IS BEYOND TIME LIMIT. ON FURTHER APPEAL, THE LD. CIT(A) HAS OBSERVED THAT THE PROVISIONS OF SECTION 154 OF THE ACT ST ATES THAT THE ASSESSING OFFICER CAN AMEND ANY ORDER PASSED BY HIM UNDER THE PROVISIONS OF THE INCOME TAX ACT, AMEND ANY INTIMATION OR DEEMED INTIMATION UNDER SUB - SECTION 1 OF SECTION 143 OF THE ACT. ACCORDINGLY, THE LD. CIT(A) DIRECTED THE ASSESSING OFFICE R TO RECTIFY THE MISTAKE APPARENT FROM RECORD IN ACCORDANCE WITH THE RATIO LAID DOWN BY THE HON BLE SUPREME COURT IN THE CASE OF BILAHARI INVESTMENT PVT. LTD. IN CIVIL APPEAL NO. 1625 OF 2008 DATED 27.02.2008. 6. 1 ADMITTEDLY, ON PERUSAL OF THE RECORDS I T IS EVIDENT THAT THE ASSESSING OFFICER HAS CHOSEN TO REVISE THE ASSESSMENTS OF EARLIER YEARS VIZ., 1998 - 99, 1999 - 2000 AND 2000 - 01 BY INITIATING PROCEEDINGS UNDER SECTION 147 OF THE ACT AND HAS ALTERED THE LOSS AVAILABLE TO BE CARRIED FORWARD FROM THESE YE ARS TO THE SUBSEQUENT YEARS. HOWEVER, I N THE ASSESSMENT YEAR 2001 - 02, THE LD. CIT(A) HAS OBSERVED THAT THE METHOD OF COMPUTATION OF INCOME FROM THE CHIT BUSINESS THAT HAS BEEN FOLLOWED IN THE RETUR N AND ACCEPTED IN THE INTIMATION UNDER SECTION 143(1) OF THE ACT DATED 08.08.2002 [COMPLETED CONTRACT METHOD] WAS NOT A CORRECT ONE AND THE CORRECT METHOD HAS BEEN LAID DOWN IN THE DECISION OF THE HON BLE MADRAS HIGH COURT VIDE ITS ORDER DATED 19.06.2006 , WHICH HAS BECOME FINAL BY THE JUDGEMENT OF HON BLE SUPREME COURT DATED 17.02.2008. IT IS A WELL SETTLED LAW THAT A JUDICIAL DECISION ACTS I.T.A. NO . 2 0 5 7 /M/ 16 10 RETROSPECTIVELY AND THE ASSESSING OFFICER IS DUTY BOUND TO PASS RECTIFICATION ORDER UNDER SECTION 154 OF THE ACT IN VI EW OF THE DECISIONS OF HIGHER COURTS, WHEN THERE IS A MISTAKE APPARENT ON RECORD. SINCE HE IMPUGNED INTIMATION UNDER SECTION 143(1) OF THE ACT WAS NOT RECTIFIED ON THE GROUND LIMITATION RAISED BY THE DEPARTMENT, WE ARE OF THE CONSIDERED OPINION THAT THE AS SESSING OFFICER WAS AGAINST THE NATURAL JUSTICE AS WELL AS UNJUSTIFIABLE. UNDER THE ABOVE CIRCUMSTANCES, THE LD. CIT(A) HAS RIGHTLY DIRECTED THE ASSESSING OFFICER TO RECTIFY THE MISTAKE APPARENT FROM RECORD IN ACCORDANCE WITH THE RATIO LAID DOWN BY THE HON BLE SUPREME COURT IN THE CASE OF BILAHARI INVESTMENT PVT. LTD. (SUPRA) AND WE FIND NO REASON TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(A). ACCORDINGLY, THE GROUND RAISED BY THE REVENUE IS DISMISSED. 7 . IN THE RESULT, THE APPEAL FILED BY THE REV ENUE IS DISMISSED. ORDER PRONOUNCED ON THE 30 TH MARCH, 201 7 AT CHENNAI. SD/ - SD/ - (CHANDRA POOJARI) ACCOUNTANT MEMBER ( DUVVURU RL REDDY ) JUDICIAL MEMBER CHENNAI, DATED, THE 30 . 0 3 .201 7 VM/ - / COPY TO: 1. / APPELLANT , 2. / RESPONDENT , 3. ( ) / CIT(A) , 4. / CIT , 5. / DR & 6. / GF.