The Income Tax Officer, Phagwara V. Sh. Ravinder Bagga, Phagwara

MA 21/ASR/2017

• Counselvise Citation: [2017] 124 COUNSELVISE.COM (IT) 5654 (ITAT-AMRITSAR)
• Duration Of Justice: 5 month(s) 14 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 31-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 15-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: J S BHASIN
• Keywords: Rectification of order; Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH.T. S. KAPOOR, ACCOUNTANT MEMB ER AND SH.N. K.CHOUDHRY, JUDICIAL MEMBER M. A. NO. 21/(ASR)/2017 (ARISING OUT OF I.T.A NO. 542(ASR)/2015) ASSESSMENT YEAR: 2010-11 PAN: AAOPB3695B INCOME TAX OFFICER WARD-3, PHAGWARA. VS. SH. RAVINDER BAGGA, PROP. M/S BAGSONS FOUNDRIES, KHERA ROAD, PHAGWARA. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. CHARAN DASS (D.R.) RESPONDENT BY: SH. J. S. BHASIN (ADV. ) DATE OF HEARING: 28.07.2017 DATE OF PRONOU NCEMENT: 31.07.2017 ORDER PER T. S. KAPOOR (AM): THIS MISCELLANEOUS APPLICATION HAS BEEN FILED BY RE VENUE AGAINST THE ORDER OF THE HON'BLE TRIBUNAL DATED 15.09.2016 IN ITA NO. 542 (ASR)/2015. 2. AT THE OUTSET, THE LD. DR SUBMITTED THAT THERE I S A MISTAKE WHICH IS APPARENT FROM THE RECORD AND WHICH NEEDS TO BE R ECTIFIED. IT WAS SUBMITTED THAT THE HON'BLE TRIBUNAL HAD DELETED THE PENALTY U/S 271(1)(C) OF THE ACT, HOLDING THAT THE ASSESSEE HAD DECLARED THE INVESTMENT IN INSURANCE POLICIES IN THE REVISED RET URN OF INCOME. IN THIS RESPECT, IT WAS SUBMITTED THAT ASSESSEE HAD DECLARE D THE INVESTMENTS IN THE REVISED RETURN OF INCOME ONLY WHEN HE WAS CORNE RED BY THE ADIT (INV.), AND THEREFORE, ASSESSEE HAD INDEED CONCEALE D THE PARTICULARS OF THIS INCOME. MA NO. 21 (ASR)/2017 ARISING OUT OF IT A NO. 542(ASR)/2015 ASST. YEAR:2010-11 2 3. THE LD. DR, IN THIS RESPECT RELIED ON VARIOUS CA SE LAWS HOLDING THAT IF THE WRONG FURNISHING OF PARTICULARS OF INCOME IS COMMITTED WHILE FILING ORIGINAL RETURN THE REVISED RETURN BY ITSELF WOULD NOT MITIGATE THE DEFAULT. 4. ON THE OTHER HAND, THE LD. AR, SUBMITTED THAT TH E RETURN WAS REVISED WELL IN TIME AND THE SAME REVISED RETURN WA S ACCEPTED AND WAS NOT HELD TO BE INVALID AND THEREFORE, NO CASE OF CO NCEALMENT COULD HAVE BEEN MADE BY THE ASSESSING OFFICER. THE LD. AR, SUB MITTED THAT THE HON'BLE TRIBUNAL WHILE DELETING THE PENALTY HAD REL IED ON THE CASE LAWS OF DELHI HIGH COURT IN THE CASE OF CIT VS. SAS PHARMAC EUTICALS 335 ITR 359 WHICH HAS BEEN REPRODUCED IN THE TRIBUNAL ORDER ITSELF. IT WAS FURTHER SUBMITTED THAT THE MA FILED BY REVENUE IS LIABLE TO BE DISMISSED, AS THERE IS NO APPARENT MISTAKE RECTIFIABLE U/S 254(2) OF TH E ACT, AS ANY RECTIFICATION WOULD AMOUNT TO REVIEW OF ITS ORDER W HICH IS NOT PERMISSIBLE. IT WAS SUBMITTED THAT THE HON'BLE TRIBUNAL HAD TAKE N A PLAUSIBLE AND CORRECT VIEW AND, THEREFORE, THE APPLICATION FILED BY REVENUE IS LIABLE TO BE DISMISSED. AS REGARDS THE CASE LAWS RELIED ON BY TH E LD. DR, IT WAS SUBMITTED THAT THESE CASE LAWS CAN BE RELIED ON ONL Y WHILE ARGUING THE APPEAL AND NOT WHEN THE MISCELLANEOUS APPLICATION I S TO BE DECIDED. 5. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT HON'BLE. TR IBUNAL VIDE ITS ORDER DATED 15.09.2016 HAS ALLOWED RELIEF TO THE ASSESSEE BY HOLDING THAT WHEN THE REVISED RETURN FILED BY ASSESSEE WAS ACCEPTED B Y THE REVENUE AND NO CONCEALMENT WAS FOUND IN THAT RETURN OF INCOME, THE PENALTY WAS NOT IMPOSABLE. THE HON'BLE TRIBUNAL HAS ALSO RELIED ON THE JUDGMENT OF CIT MA NO. 21 (ASR)/2017 ARISING OUT OF IT A NO. 542(ASR)/2015 ASST. YEAR:2010-11 3 VS. SAS PHARMACEUTICALS (2011) 335 ITR 0259 DECIDED BY DELHI HIGH COURT, IN WHICH THE HON'BLE COURT HAD HELD THAT EXP RESSION, IN THE COURSE OF ANY PROCEEDINGS UNDER THE ACT CANNOT HAVE THE REFERENCE TO SURVEY PROCEEDINGS. MOREOVER, WE FIND THAT THE MISC ELLANEOUS APPLICATION IS NOT MAINTAINABLE, AS THERE IS NO MISTAKE WHICH I S APPARENT FROM THE RECORD AS THE HON'BLE TRIBUNAL HAS DEALT WITH THE I SSUE OF DECLARING INVESTMENTS IN THE REVISED RETURN OF INCOME AND HAS HELD THAT THERE WAS NO CONCEALMENT OF INCOME AND NOW ANY FINDING CONTRA RY TO THIS FINDING WOULD AMOUNT TO REVIEW OF THE ORDER OF THE TRIBUNAL WHICH IS NOT PERMISSIBLE UNDER THE PROVISIONS OF LAW. UNDER THE PROVISIONS THE HON'BLE TRIBUNAL IS ONLY AUTHORIZED TO RECTIFY ANY MISTAKE WHICH IS APPARENT FROM RECORD. A BARE LOOK AT SECTION 254(2) OF THE ACT, WHICH DE ALS WITH RECTIFICATION, MAKES IT AMPLY CLEAR THAT A MISTAKE APPARENT FROM THE RECORD IS RECTIFIABLE. IN ORDER TO ATTRACT THE APP LICATION OF SECTION 254(2), A MISTAKE MUST EXIST AND THE SAME MUST BE APPARENT FROM THE RECORD. THE POWER TO RECTIFY THE MISTAKE, HOWEVER, DOES NOT COVER CASES WHERE A REVISION OR REVIEW OF THE ORDER IS INTENDED. MISTA KE MEANS TO TAKE OR UNDERSTAND WRONGLY OR INACCURATELY; TO MAKE AN ERRO R IN INTERPRETING, IT IS AN ERROR; A FAULT, A MISUNDERSTANDING, A MISCONC EPTION. APPARENT MEANS VISIBLE; CAPABLE OF BEING SEEN; EASILY SEEN; OBVIOUS; PLAIN, A MISTAKE WHICH CAN BE RECTIFIED UNDER SECTION 254(2) IS ONE WHICH IS PATENT, WHICH IS OBVIOUS AND WHOSE DISCOVERY IS NOT DEPENDENT ON ARGUMENT OR ELABORATION. THE LANGUAGE USED IN SECTI ON 254(2) IS MA NO. 21 (ASR)/2017 ARISING OUT OF IT A NO. 542(ASR)/2015 ASST. YEAR:2010-11 4 PERMISSIBLE WHERE IT IS BROUGHT TO THE NOTICE OF TH E TRIBUNAL THAT THERE IS ANY MISTAKE APPARENT FROM THE RECORD. ACCORDINGLY, THE AMENDMENT OF AN ORDER DOES NOT MEAN OBLITERATION OF THE ORDER ORIGI NALLY PASSED AND ITS SUBSTITUTION BY A NEW ORDER WHICH IS NOT PERMISSIBL E UNDER THE PROVISIONS OF SECTION 254(2). FURTHER, WHERE AN ERR OR IS FAR FROM SELF EVIDENT, IT CEASES TO BE AN APPARENT ERROR. IT IS N O DOUBT TRUE THAT A MISTAKE CAPABLE OF BEING RECTIFIED UNDER SECTION 25 4(2) IS NOT CONFINED TO CLERICAL OR ARITHMETICAL MISTAKES. ON THE OTHER HAN D, IT DOES NOT COVER ANY MISTAKE WHICH MAY BE DISCOVERED BY A COMPLICATE D PROCESS OF INVESTIGATION, ARGUMENT OR PROOF. AS OBSERVED BY TH E SUPREME COURT IN MASTER CONSTRUCTION CO. (P) LTD. V. STATE OF ORISSA [1966] 17 STC 360, AN ERROR WHICH IS APPARENT ON THE FACE OF THE RECORD S HOULD BE ONE WHICH IS NOT AN ERROR WHICH DEPENDS FOR ITS DISCOVERY ON ELA BORATE ARGUMENTS ON QUESTIONS OF FACT OR LAW. A SIMILAR VIEW WAS ALSO E XPRESSED IN SATYANARAYAN LAXMINARAYAN HEDGE V. MALLIKARJUN BHAV ANAPPA TIRUMALE AIR 1960 SC 137. IT IS TO BE NOTED THAT THE LANGUAG E USED IN ORDER 47, RULE 1 OF THE CODE OF CIVIL PROCEDURE, 1908 IS DIFF ERENT FROM THE LANGUAGE USED IN SECTION 254(2) OF THE ACT. POWER IS GIVEN T O VARIOUS AUTHORITIES TO RECTIFY ANY MISTAKE APPARENT FROM THE RECORD IS U NDOUBTEDLY NOT MORE THAN THAT OF THE HIGH COURT TO ENTERTAIN A WRIT PET ITION ON THE BASIS OF AN ERROR APPARENT ON THE FACE OF THE RECORD. MISTAKE IS AN ORDINARY WORD, BUT IN TAXATION LAWS, IT HAS A SPECIAL SIGNIFICANCE . IT IS NOT AN ARITHMETICAL OR CLERICAL ERROR ALONE THAT COMES WIT HIN ITS PURVIEW. IT COMPREHENDS ERRORS WHICH, AFTER A JUDICIOUS PROBE I NTO THE RECORD FROM MA NO. 21 (ASR)/2017 ARISING OUT OF IT A NO. 542(ASR)/2015 ASST. YEAR:2010-11 5 WHICH IT IS SUPPOSED TO EMANATE, ARE DISCERNED. THE WORD MISTAKE IS INHERENTLY INDEFINITE IN SCOPE, AS WHAT MAY BE A MI STAKE FOR ONE MAY NOT BE ONE FOR ANOTHER. IT IS MOSTLY SUBJECTIVE AND THE DIVIDING LINE IN BORDER AREAS IS THIN AND INDISCERNIBLE. IT IS SOMETHING WH ICH A DULY AND JUDICIOUSLY INSTRUCTED MIND CAN FIND OUT FROM THE R ECORD. IN ORDER TO ATTRACT THE POWER TO RECTIFY UNDER SECTION 254(2) I T IS NOT SUFFICIENT IF THERE IS MERELY A MISTAKE IN THE ORDERS SOUGHT TO B E RECTIFIED. THE MISTAKE TO BE RECTIFIED MUST BE ONE APPARENT FROM T HE RECORD. A DECISION ON THE DEBATABLE POINT OF LAW OR UNDISPUTED QUESTIO N OF FACT IS NOT A MISTAKE APPARENT FROM THE RECORD. THE PLAIN MEANING OF THE WORD APPARENT IS THAT IT MUST BE SOMETHING WHICH APPEA RS TO BE SO EX FACIE AND IT IS IN CAPABLE OF ARGUMENT OR DEBATE. IT IS T HEREFORE, FOLLOWS THAT A DECISION ON A DEBATABLE POINT OF LAW OR FACT OR FAI LURE TO APPLY THE LAW TO A SET OF FACTS WHICH REMAINS TO BE INVESTIGATED CANNO T BE CORRECTED BY WAY OF RECTIFICATION. THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. KA RAN CHAND THAPAR & BR. P. LTD., 176 ITR 535 HAS HELD AS UNDER : IT IS EQUALLY WELL SETTLED THAT THE DECISION OF TH E TRIBUNAL HAS NOT TO BE SCRUTINIZED SENTENCE BY SENTENCE MERELY TO FIND OUT WHETHER ALL FACTS HAVE BEEN SET OUT IN DETAIL BY THE TRIBUNAL OR WHETHER S OME INCIDENTAL FACT WHICH APPEARS ON THE RECORD HAS NOT BEEN NOTICED BY THE TRIBUNAL IN ITS JUDGMENT. IF THE COURT, ON A FAIR READING OF THE JU DGMENT OF THE TRIBUNAL, FINDS THAT IT HAS TAKEN INTO ACCOUNT ALL RELEVANT M ATERIAL AND HAS NOT TAKEN INTO ACCOUNT ANY IRRELEVANT MATERIAL IN BASING ITS CONCLUSIONS, THE DECISION OF THE TRIBUNAL IS NOT LIABLE TO BE INTERFERED WITH , UNLESS, OF COURSE, THE CONCLUSIONS ARRIVED AT BY THE TRIBUNAL ARE PERVERSE . IT IS NOT NECESSARY FOR THE TRIBUNAL TO STATE IN IT S JUDGMENT SPECIFICALLY OR IN EXPRESS WORDS THAT IT HAS TAKEN INTO ACCOUNT THE CU MULATIVE EFFECT OF THE CIRCUMSTANCES OR HAS CONSIDERED THE TOTALITY OF THE FACTS, AS IF THAT WERE A MA NO. 21 (ASR)/2017 ARISING OUT OF IT A NO. 542(ASR)/2015 ASST. YEAR:2010-11 6 MAGIC FORMULA; IF THE JUDGMENT OF THE TRIBUNAL SHOW S THAT IT HAS, IN FACT, DONE SO, THERE IS NO REASON TO INTERFERE WITH THE D ECISION OF THE TRIBUNAL. SIMILARLY, THE HON'BLE MADRAS HIGH COURT DECISIONS IN T.C.(A) NO. 156 OF 2006 DATED 21.08.2007 IN THE CASE OF CIT VS. TAMIL NADU SMALL INDUSTRIES DEVELOPMENT CORPORATION LTD. WHEREIN THE HON'BLE HIGH COURT HELD AS UNDER: THE TRIBUNAL HAS NO POWER TO REVIEW ITS ORDER. WHE N THE TRIBUNAL HAS ALREADY DECIDED AN ISSUE BY APPLYING ITS MIND AGAIN ST THE ASSESSEE, THE SAME CANNOT BE RECTIFIED UNDER SECTION 254 (2) OF T HE ACT. THERE WAS NO NECESSITY WHATSOEVER ON THE PART OF THE TRIBUNAL TO REVIEW ITS OWN ORDER. EVEN AFTER THE EXAMINATION OF THE JUDGMENTS OF THE TRIBUNAL, WE COULD NOT FIND A SINGLE REASON IN THE WHOLE ORDER AS TO HOW T HE TRIBUNAL IS JUSTIFIED AND FOR WHAT REASONS. THERE IS NO APPARENT ERROR ON THE FACE OF THE RECORD AND THEREBY THE TRIBUNAL SAT AS AN APPELLATE AUTHOR ITY OVER ITS OWN ORDER. IT IS COMPLETELY IMPERMISSIBLE AND THE TRIBUNAL HAS TRAVELED OUT OF ITS JURISDICTION TO ALLOW A MISCELLANEOUS PETITION IN T HE NAKE OF REVIEWING ITS OWN ORDER. IN THE PRESENT CASE, IN THE GUISE OF RECTIFICATION , THE TRIBUNAL REVIEWED ITS EARLIER ORDER AND ALLOWED THE MISCELLANEOUS PETITIO N WHICH IS NOT IN ACCORDANCE WITH LAW. SECTION 254(2) OF THE ACT DOES NOT CONTEMPLATE REHEARING OF THE APPEAL FOR A FRESH DISPOSAL AND DO ING SO, WOULD OBLITERATE THE DISTINCTION BETWEEN THE POWER TO RECTIFY MISTAK ES AND POWER TO REVIEW THE ORDER MADE BY THE TRIBUNAL. THE SCOPE AND AMBIT OF THE APPLICATION OF SECTION 254(2) IS LIMITED AND NARROW. IT IS RESTRIC TED TO RECTIFICATION OF MISTAKES APPARENT FROM THE RECORD. RECALLING THE OR DER OBVIOUSLY WOULD MEAN PASSING OF A FRESH ORDER. RECALLING OF THE ORDER IS SNOT PERMISSIBLE UNDER SE C. 254(2) OF THE ACT. ONLY GLARING AND ANY MISTAKE APPARENT ON THE FACE OF THE RECORD ALONE CAN BE RECTIFIED AND HENCE ANYTHING DEBATABLE CANNOT BE A SUBJECT MATTER OF RECTIFICATION. FURTHER, THE HON'BLE DELHI HIGH COURT JUDGMENT ON T HE SCOPE OF RECTIFICATION U/S 254(2) AS REPORTED IN THE CASE OF RAS BIHARI BANSAL VS. CIT 293 ITR 365 HAS HELD AS UNDER: SECTION 254 OF THE INCOME TAX ACT, 1961, ENABLES T HE CONCERNED AUTHORITY TO RECTIFY ANY MISTAKE APPARENT FROM THE RECORD. IT IS WELL SETTLED THAT AN OVERSIGHT OF A FACT CANNOT CONSTITUTE AN APPARENT M ISTAKE RECTIFIABLE UNDER THIS SECTION. SIMILARLY, FAILURE OF THE TRIBUNAL TO CONSIDER AN ARGUMENT ADVANCED BY EITHER PARTY FOR ARRIVING AT A CONCLUSI ON IS NOT AN ERROR APPARENT ON THE RECORD, ALTHOUGH IT MAY BE AN ERROR OF JUDGMENT. THE MERE MA NO. 21 (ASR)/2017 ARISING OUT OF IT A NO. 542(ASR)/2015 ASST. YEAR:2010-11 7 FACT THAT THE TRIBUNAL HAD NOT ALLOWED A DEDUCTION, EVEN IF THE CONCLUSION IS WRONG, WILL BE NO GROUND FOR MOVING AN APPLICATI ON UNDER SECTION 254(2) OF THE ACT. FURTHER, IN THE GARB OF AN APPLICATION FOR RECTIFICATION, THE ASSESSEE CANNOT BE PERMITTED TO REOPEN AND RE-ARGUE THE WHOLE MATTER, WHICH IS BEYOND THE SCOPE OF THE SECTION. THEREFORE, IN VIEW OF THE FACTS AND CIRCUMSTANCES O F THE CASE, AND IN THE LIGHT OF RATIO OF THE DECISIONS CITED AND DI SCUSSION AS ABOVE, WE DO NOT FIND ANY SUBSTANCE IN THE APPLICATION OF REVENU E AND DISMISS THE SAME BEING DEVOID OF ANY MERITS. 7. IN VIEW OF THE ABOVE, THE MISCELLANEOUS APPLICAT ION FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31.07. 2017. SD/- SD/- (N. K. CHOUDHRY) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED 31/07/2017 GP/SR./PS COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER