RFS India Telecom Pvt. Ltd., New Delhi V. ACIT, New Delhi

MA 154/DEL/2021

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 2759 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-09-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: I
• Next Hearing Date: 21-07-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 07-09-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES “I” : DELHI BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER M.A.No.154/Del./2021 Arising out of ITA.No.2040/Del./2017 - Assessment Year 2012-2013 RFS India Telecom Pvt. Ltd., E-8/1, Lower Ground Floor, Near Geeta Bhawan Mandir, Malviya Nagar, New Delhi – 110 017. PAN AADCR5389R vs. The ACIT, Circle – 21 (1), New Delhi. (Applicant) (Respondent) For Assessee : Shri Neeraj Jain, Advocate For Revenue : Shri Abhishek Kumar, Sr. DR Date of Hearing : 22.07.2022 Date of Pronouncement : 21.09.2022 ORDER PER ANIL CHATURVEDI, A.M. : The above Miscellaneous Application [in short “M.A.”] filed by the assessee arises out of the order dated 11.11.2020 passed by the Tribunal in ITA.No.2040/Del./2017 for the A.Y. 2012-13. 2 M.A.No.154/Del./2021 RFS India Telecom Pvt. Ltd., New Delhi. 2. The Learned Counsel for the Assessee through his written submissions contended, inter alia, that in para- 15 of the order of the Tribunal, while setting aside the order of the TPO, the Tribunal has inadvertently directed the TPO to compute the ALP by following the TNMM method instead of RPM Method. 3. The Ld. D.R. did not strongly opposed to the above submissions of the Learned Counsel for the Assessee. 4. We, therefore, modify the order of the Tribunal dated 11.11.2020 in para No.15 to the extent that the TPO is directed to compute the ALP by following the RPM Method. To that effect para No.15 is modified. 5. Learned AR submitted that vide ground No.3 - 3.10, the issue was about the disallowance of loss incurred on foreign exchange fluctuation/revaluation of stock amounting to Rs.9,91,02,710/-. 3 M.A.No.154/Del./2021 RFS India Telecom Pvt. Ltd., New Delhi. 6. Learned AR with respect to revaluation of closing stock submitted that during the year assessee had made provision of obsolete stock of Rs.11,39,08,949/-. He submitted that DRP had mistakenly considered the disallowance of foreign exchange loss of Rs.1,98,20,542/- made by A.O. in the draft order as disallowance of obsolete stock and directed the A.O. to make disallowance of Rs.9,91,02,710/-. He submitted that assessee in its return of income had already made disallowance of entire provision of obsolete stock of Rs.11,39,08,949/- and offered the same to tax. He submitted that since the said loss on revaluation of stock has not been claimed as deduction in the return of income, no further disallowance of same expenditure ought to be made while computing taxable income. He submitted that in Para No.19 of the order of the Tribunal dated 11.11.2020 the Tribunal set aside the matter to the file of A.O. to decide the ground with respect to addition of Rs.9,91,02,710/- in accordance with law, after affording reasonable opportunity of hearing to the assessee, which is not inconsonance with the observations made by the Tribunal in the preceding 4 M.A.No.154/Del./2021 RFS India Telecom Pvt. Ltd., New Delhi. paragraph No.17. He therefore submitted that since the finding in para 19 is inconsistent with the submissions of assessee as noted in para 17, the order of setting aside the mater to A.O. needs to be set aside. 7. The Ld. D.R. on the other hand submitted that since the Tribunal has restored the matter in issue to the file of A.O. for fresh adjudication and the assessee has been provided with another opportunity to put-forth his submissions, there is no mistake apparent on record. Therefore, there is no ground for the assessee seeking to recall the matter in issue and under the garb of rectification, the Tribunal has no power to review it’s own order. 8. We have heard the rival submissions of both the parties and perused the record. We find prima facie there is no mistake apparent on record. The matter in issue has been restored to the file of A.O. for fresh adjudication. We find merit in the submissions of the Ld. D.R. that the Assessee is seeking review of the Tribunal’s order which is not permissible under law and is outside the ambit of 5 M.A.No.154/Del./2021 RFS India Telecom Pvt. Ltd., New Delhi. Section 254(2) of the I.T. Act, 1961, in the light of judgment of the Hon’ble Supreme Court rendered in the case of CIT vs., M/s. Reliance Telecom Ltd., in Civil Appeal No.7110 of 2021. The relevant observations of Hon’ble Supreme Court reads as under : “5. From the impugned judgment and order passed by the High Court, it appears that the High Court has dismissed the writ petitions by observing that (i) the Revenue itself had in detail gone into merits of the case before the ITAT and the parties filed detailed submissions based on which the ITAT passed its order recalling its earlier order; (ii) the Revenue had not contended that the ITAT had become functus officio after delivering its original order and that if it had to relook/revisit the order, it must be for limited purpose as permitted by Section 254(2) of the Act; and (Hi) that the merits might have been decided erroneously but ITAT had the jurisdiction and within its powers it may pass an erroneous order and that such objections had not been raised before ITAT. 6 M.A.No.154/Del./2021 RFS India Telecom Pvt. Ltd., New Delhi. 6. None of the aforesaid grounds are tenable in law. Merely because the Revenue might have in detail gone into the merits of the case before the ITAT and merely because the parties might have filed detailed submissions, it does not confer jurisdiction upon the ITAT to pass the order de hors Section 254(2) of the Act. As observed hereinabove, the powers under Section 254(2) of the Act are only to correct and/or rectify the mistake apparent from the record and not beyond that. Even the observations that the merits might have been decided erroneously and the ITAT had jurisdiction and within its powers it may pass an order recalling its earlier order which is an erroneous order, cannot be accepted. As observed hereinabove, if the order passed by the IT AT was erroneous on merits, in that case, the remedy available to the Assessee was to prefer an appeal before the High Court, which in fact was filed by the Assessee before the High Court, but later on the Assessee withdrew the same in the instant case.” 7 M.A.No.154/Del./2021 RFS India Telecom Pvt. Ltd., New Delhi. 9. Respectfully following the Judgment of Hon’ble Supreme Court in the case of Reliance Telecom Ltd. (supra), the misc. applications moved by the Assessee with respect to the ground relating to addition of Rs. Rs.9,91,02,710/- is dismissed. 10. In the result, M.A. of the Assessee is partly allowed. Order pronounced in the open Court on 21.09.2022. Sd/- Sd/- (ASTHA CHANDRA) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER Delhi, Dated 21 st September, 2022 VBP/- Copy to 1. The appellant 2. The respondent 3. CIT(A) concerned 4. CIT concerned 5. D.R. ITAT ‘I’ Bench, Delhi 6. Guard File. // By Order // Assistant Registrar : ITAT Delhi Benches : Delhi.