Caktus Properties Pvt. Ltd., Delhi V. ITO, New Delhi

MA 181/DEL/2018

AI Insights

The case involves Caktus Properties Pvt. Ltd., the appellant, seeking to recall an order passed by the Income Tax Appellate Tribunal (ITAT) in a previous appeal concerning the Assessment Year 2002-03. The appellant argued that certain legitimate office expenses and expenses on the sale of land were not considered in the original order, constituting a mistake apparent from the record. The respondent, ITO, Ward-3(2), opposed the application, citing no mistake apparent on record. The Tribunal, referencing the Supreme Court's decision in CIT vs M/s. Reliance Communication Ltd., dismissed the application, emphasizing that the ITAT's role under Section 254(2) is limited to correcting apparent mistakes and does not extend to re-evaluating the merits of the case.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 122206 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 14 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-04-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 16-02-2023
• Assessment Year: 2002-2003
• Appeal Filed On: 21-03-2018
• Other Referred Cases: CIT vs M/s. Reliance Communication Ltd. in Civil Appeal No.7111 of 2021
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 68; 254(2); 2(A); 13; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “FRIDAY/B” BENCH: NEW DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER & DR.B.R.R.KUMAR, ACCOUNTANT MEMBER M.A.No.-181/Del/2018 [In ITA No.3813/Del/2013] [Assessment Year : 2002-03] Caktus Properties Pvt.Ltd., 2753/4, Zorawar Singh Marg, Delhi-110006 PAN-AAACC5473C vs ITO, Ward-3(2), C.R. Building, New Delhi. APPELLANT RESPONDENT Appellant by None Respondent by Shri Kanav Bali, Sr.DR Date of Hearing 17.02.2023 Date of Pronouncement 05.04.2023 ORDER PER KUL BHARAT, JM : The present Miscellaneous Applications (M.A.) has been filed by the assessee seeking recalling of the order passed by the Tribunal in ITA No.3813/Del/2013 pertaining to Assessment Year 2002-03 vide order dated 21.11.2017. 2. At the time of hearing, No one attended the proceeding on behalf of the assessee. It is seen from the records that no one has been attending the proceedings since 12.10.2022. Under these facts, the application of the assessee is taken up for hearing in the absence of the assessee. 3. Ld. Sr. DR for the Revenue opposed the contents of the Miscellaneous Application. He submitted that there is no mistake apparent on record and in view of the decision of the Hon’ble Supreme Court rendered in the case of CIT vs M/s. Reliance Communication Ltd. in Civil Appeal No.7111 of 2021. 2 | Page 4. We have heard Ld. Sr.DR for the Revenue and perused the material available on record. The contention of the assessee as stated in the Miscellaneous Application is as under:- 3. “The honorable ITAT dismissed ground nos. 2(a) & 2(b) of the appeal which are related to legitimate office expenses Rs. 137370 and expenses on sale of land Rs. 33375, considering that the same are not pressed by the counsel of the assessee. The appellant company submits that it is discussed at page no. 3 column no. 3 and detail of expenses enclosed at page no. 22 of the paper book. The detail of expenses also provided in Schedule-6 of the balance-sheet at page no 13 of the paper book. The AO allowed write off of preliminary expenses only but CIT disallowed all expenses and The Tribunal disposed of these grounds without considering the record. It is respectfully submitted that the omission on the part of the Tribunal to consider these details constitute a mistake apparent from the record. The appellant, therefore, pray that the Tribunal may be pleased to suitably amend its said Order to rectify the said mistake which is apparent from the record. 4. The Tribunal has disposed of ground no. 2(c) of the appeal in paragraph 5 of its Order which reads as under: "These facts support the findings of the authorities below that the issue of share capital of Rs.6,00,200 was never raised earlier before the Ld. ClT (A) as well as before the Tribunal and addition has become final. Therefore, the AO in the present set aside proceedings under section 254/143(3) correctly denied re-adjudication of the addition vide order dated 23.12.2011. Learned Counsel for the Assessee did not dispute these facts during the course of arguments that this point was not raised before the Ld. CIT (A) in the grounds of appeal in the first appellate proceedings. The same fact has already been mentioned by the Ld. ClT (A) in the arguments of the assessee that "unfortunately this issue was not taken-up for want of ground 3 | Page of appeal" No infirmity has been pointed out in the orders of the authorities below. This Ground of appeal of assessee is accordingly dismissed". The Appellants submit that the said Order overlooks the fact mentioned on page no. 26 column no. 12 in the paper book, which was written submission in 1 st appeal before the CIT (A) on dated March 5, 2009, "The AO has further made an addition of Rs. 600200 on account of capital. which is uncalled for and unjustified. No fresh capital is during the year, so the addition is legally unjustified and liable to be deleted. The balance- sheet submitted with the return will prove our contention". Hence the application of section 68 in this case does not have any legal sanction. The Hon'ble Income Tax Appellate Tribunal, Indore Bench, Indore also opined in the case of Shri Paramjeet Singh Chhabra Indore- Appellant Vs Income Tax Officer I (2) Indore, ITA No. 112/ Ind /2013, "it was the duty of the Assessing Officer to assist the tax payer in a reasonable way and to provide the relief if due to the assessee. This attitude rather will help the Revenue in assessing the income correctly. A correct advice by the Department would inspire the confidence of public at large. Even identical guidelines/instructions have been issued from time to time by the CBDT to its Officers (Circular No. 14(XL-35) dated 11.4.1955 and letter No. F.81 /27/65-IT(B) dated 18.5.1965). It is respectfully submitted that the Tribunal may be pleased to suitably amend its Order to rectify the aforesaid mistakes which are apparent from the record. The appellant humbly prays that in light of the Circular No. 14(XL-35) dated 11.4.1955 and letter No. F.81/27/65-IT(B) dated 18.5.1965 in order to meet the ends of justice, the additions which are not called for from any legal or factual angle, may kindly be deleted.” 5. We have considered the contention of Ld.Sr.DR. The law is well settled regarding scope of section 254 of the Act. The Hon’ble Supreme Court in the case of CIT vs M/s. Reliance Communication Ltd. (supra) has held as under:- 4 | Page 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 (iii) 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. 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 ITAT 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. In view of the above and for the reasons stated above, the impugned common judgment and order passed by the High Court as well as the common order passed by the ITAT dated 18.11.2016 recalling its earlier order dated 06.09.2013 deserve to be quashed and set aside 5 | Page and are accordingly quashed and set aside. The original orders passed by the ITAT dated 06.09.2013 passed in the respective appeals preferred by the Revenue are hereby restored. 8. Considering the fact that the Assessee had earlier preferred appeal/s before the High Court challenging the original order passed by the ITAT dated 06.09.2013, which the Assessee withdrew in view of the subsequent order passed by the ITAT dated 18.11.2016 recalling its earlier order dated 06.09.2013, we observe that if the Assessee/s prefers/prefer appeal/s before the High Court against the original order dated 06.09.2013 within a period of six weeks from today, the same may be decided and disposed of in accordance with law and on its/their own merits and without raising any objection with respect to limitation. 9. Both the appeals are accordingly allowed in the aforesaid terms. However, there shall be no order as to costs.” 6. In the light of the above judgment of Hon’ble Supreme Court in the case of CIT vs M/s. Reliance Communication Ltd. (supra), we do not find any merit in the application filed by the assessee, the same is hereby dismissed. 7. In the result, the Miscellaneous Application filed by the assessee is dismissed. Order pronounced in the open Court on 05 th April, 2023. Sd/- Sd/- (DR.B.R.R.KUMAR) (KUL BHARAT) ACCOUNTANT MEMBER JUDICIAL MEMBER * Amit Kumar * 6 | Page Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI