M/S HOTEL NEW NIYAZ,BELGAUM V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 2(1), BELGAUM

MA 21/PAN/2023

AI Insights

The case involves M/s Hotel New Niyaz, which filed a Miscellaneous Application seeking rectification of an earlier Tribunal order that confirmed the addition of suppressed sales to their income. The Tribunal had previously allowed the appeal in part, confirming the addition based on findings from survey proceedings. In the MA, the applicant attempted to reargue and reappreciate the facts concerning the suppressed sales, which was objected to by the Revenue. The Tribunal, referencing Supreme Court precedents, clarified that rectification under Section 254(2) does not allow for reappraisal of facts or revisiting the merits of the case.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 472081 (ITAT-PANAJI)
• Duration Of Justice: 1 year(s) 1 month(s) 19 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 05-12-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: WT(D)
• Next Hearing Date: 29-11-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 16-10-2023
• Other Referred Cases: T. S. Balaram, ITO vs M/s Volkart Brother, Bombay, CIT Vs Reliance Telecom Ltd
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: CAPT. PRADEEP ARYA LD.
• Assessee Lawyers: RAKESH JOSHI LD.
• Keywords: Rectification of order
• Section: 254(2)

Judgement Text

" ॥ आयकर अपीलीय न्यायाधिकरण, पणजी न्यायपीठ, पणजी में॥ ITAT-Panaji Page 1 of 4 IN THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCH, PANAJI BEFORE HON’BLE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER आयकर अपील सं. / MA No. 021/PAN/2023 (Arising out of ITA No. 024/PAN/2022) निर्धारण वर्ा / Assessment Year : 2017-18 M/s Hotel New Niyaz 4697/B, Opp. Market Police Station, PB Road, Belgaum-590005. PAN : AACFH0361D . . . . . . . Applicant बिधम / V/s Asstt. Commissioner of Income Tax, Circle-2(1), Belgaum . . . . . . . Respondent द्वधरध / Appearances Assessee by : Mr Rakesh Joshi [‘Ld. AR’] Revenue by : Capt. Pradeep Arya [‘Ld. DR’] सुिवधई की तधरीख / Date of conclusive Hearing : 29/11/2024 घोर्णध की तधरीख / Date of Pronouncement : 05/12/2024 आदेश / ORDER PER G. D. PADMAHSHALI, AM; By the present Miscellaneous Applications [for short ‘MA’] the applicant assessee seeks to rectify the order of this Tribunal passed u/s 254(1) of the Income Tax Act [for short ‘the Act’] in 024/PAN/2022 dt. 07/07/2024 whereby the appeal filed by the assessee was party allowed confirming the addition under rectification. 2. We have heard rival submissions of both the parties; and subject to the provisions of rule 18 of Income Tax Appellate Tribunal Rules, 1963 [for short ‘ITAT, Rules’] perused the MA and duly considered the contents & prayer thereof in the light of settled legal position. MA No. 021/PAN/2023 Arising out of ITA No. 024/PAN/2022 ITAT-Panaji Page 2 of 4 3. We have given our thoughtful consideration to MA & its contents which sought our indulgence to re-adjudicate an issue relating to addition of suppressed sales made by the Ld. AO which subsequently sustained at both the appellate stages. We note that, on the basis of findings made from the material/records found in the course of survey proceedings, the addition of suppressed sales were worked out which was duly supported by the statement of the applicant assessee for the purpose of addition. The said addition was confirmed in first as well in second appellate proceedings. By the present MA the applicant assessee seeks our indulgence by plumping us into the ‘way of percentage of suppressed sales computed by the Ld. AO’ and which eventually confirmed by the Tribunal in appeal. It is the case of the applicant that, by overlooking the facts relating to recorded and unrecorded sales figures the Tribunal adjudicated the issue against the applicant assessee and dismissed the relevant ground. 4. Ex-facie by the present MA the applicant assessee in our considered view alleged the correctness of the decision arrived by the Tribunal and in doing so the applicant erected its spine of allegation solely on the basis of facts perceived by it au contraire the factual matrix put on ice by the Tribunal. To bolster up its version of facts, the applicant assessee during present proceedings by adverting to the assessment, first appellate and second appellate records and submissions made therein left no stone untuned in trying hard to persuade us to re-look into the facts a fresh and reappreciate them with a new dimension. This attempt of the applicant assessee as rightly objected by the Ld. DR Capt. Arya could hardly of much help as it falls out of scope of rectification envisaged u/s 254(2) of the Act. MA No. 021/PAN/2023 Arising out of ITA No. 024/PAN/2022 ITAT-Panaji Page 3 of 4 5. From the facts narrated in the applicant’s MA and arguments raised vis-à- vis submission made by the Ld. AR in the present proceedings, it clearly suggested us that; (1) the applicant tried to re-appreciate the facts and (2) also tried to reargue its case under the garb of rectification. And it is not out of place to state here that, such attempt of the application was without singling out any error or mistake on the face of the record to rectify u/s 254(2) of the Act. 6. Rectification of order stems from fundamental principle that justice is above all. It is exercised to remove error and not to disturb finality of facts findings. The Hon’ble Supreme Court in a landmark case of ‘T. S. Balaram, ITO vs M/s Volkart Brother, Bombay’ [1971, 82 ITR 50 (SC)], has first laid down the test as to what qualifies for rectification. While dealing with the subject their Hon’ble lordships laid that; (1) a mistake apparent on record must be an obvious and patent, (2) not something which can be established by long- drawn process of reasoning on point capable of two opinions, (3) a decision on a debatable point of law is not a mistake, (4) a cursory look at records must show that there has been an error, (5) reference to outside the records is impermissible and (6) reappreciation of facts in any form is impermissible. It is worthy to note here that, while interpreting Section 254(2) of the Act their Hon’ble lordships in another case ‘CIT Vs Reliance Telecom Ltd’ [2021, 133 taxmann.com 41 (SC)] have categorically held that, the provisions of section 254(2) cannot be utilized relook or revisit facts to recall and review any order on its merits. MA No. 021/PAN/2023 Arising out of ITA No. 024/PAN/2022 ITAT-Panaji Page 4 of 4 7. Ostensibly the contents of the MA de-facto trying to suggest mere miscarriage of justice much less pinpointing any apparent mistake. The applicant assessee’s accelerated arguments laid during the course of present proceedings in our considered view has been much successful in not showcasing or pinpointing even a single mistake from the order sought to be rectified. What sanction of s/s 2 of section 254 necessitates is that a patent mistake which can be rectified must that be either clerical, or grammatical or arithmetical, or like nature, which could be detected without re- argument or reappraisal of facts or long driven process unlike the one in the present case. Therefore in view of the aforestated discussion and judicial precedents we do not find any strength in the present MA as such is devoid and bereft of any merit to qualify for rectification thus deserves to be dismissed. Since the applicant has failed to bring out to our notice any other rectifiable mistake which can indeed be rectified u/s 254(2) of the Act, hence we do not find any reasons to interfere with the impugned order sought to be rectified. 8. In result, the MA of the applicant assessee stands DISMISSED. U/r 34 of ITAT Rules, order pronounced in the open court on the date mentioned herein above. -S/d- -S/d- PAVAN KUMAR GADALE G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER Panaji, Dated : 05th day of December, 2024 Copy of the Order forwarded to : 1.अपीलधर्थी / The Applicant 2. प्रत्यर्थी / The Respondent. 3. The CIT-(A) Panaji-1, Goa 4. The Pr.CIT, Panaji 5. DR, ITAT, Bench, Panaji 6.गधर्ाफ़धइल / Guard File. आदेशधिुसधर / By Order वररष्ठ निजी सनिव / Sr. Private Secretary आयकर अपीलीय न्यधयधनर्करण, पुणे / ITAT, Panaji. "