Mr. George Kutty, New Delhi V. DCIT, New Delhi

MA 356/DEL/2018

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 4060 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 8 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 06-06-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 28-05-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 131; 68; 254(2); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH ‘SMC’ : NEW DELHI) SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER and SHRI KUL BHARAT, JUDICIAL MEMBER MA No.356/Del/2018 (in ITA No.4247/Del./2016) (ASSESSMENT YEAR : 2010-11) Mr. George Kutty, vs. DCIT, Circle 13 (1), C/o M/s. Oasis Tours India (P) Ltd., Circle 13 (1), C-40, Middle Connaught Place, New Delhi. New Delhi – 110 001. (PAN : AAJPK4056H) (APPLICANT) (RESPONDENT) APPLICANT/ASSESSEE BY : Shri Satish Khosla, Advocate Shri Manish Malik, Advocate REVENUE BY : Shri Sanjay Kumar, Senior DR Date of Hearing : 13.05.2022 Date of Order : 07.06.2022 ORDER PER SHAMIM YAHYA, ACCOUNTANT MEMBER : By way of this misc. application, applicant/assessee seeks rectification of mistake apparent from record in the order of this Tribunal in ITA No.4247/Del/2016 for Assessment Year 2010-11 vide order dated 31.08.2017. 2. We have heard both the parties and perused the record. MA No.356/Del./2018 2 3. Ld. counsel of the assessee has made his arguments which are contained in the misc. application hereunder :- “The above named appellant seeks indulgence of the Hon'ble ITAT Delhi Bench ‘F' New Delhi to exercise powers vested u/s. 254(2) of the LT. Act, 1961 (hereinafter referred to as the Act), in rectifying the mistake apparent on record in the order passed by the Hon'ble Bench on 31.08.2017. The only issue for consideration by the Hon'ble Bench was as to whether the addition made by the Ld. Assessing officer u/s. 68 of the Act, which was sustained by the Ld. Commissioner of Income-tax (Appeals), was correct on the facts and circumstances of the case. The facts of the case have been recorded by the Tribunal in Para(s) :3 and 4 of the order, which brings out the controversy subsisting between the appellant and the department. In Para 5 of the judgment, the Hon'ble Bench has reproduced a portion of the order of the Ld. Commissioner of Income- tax (Appeals). In Para 6 of the order, the Hon'ble Tribunal refers to the application under Rule 46A of the I.T. Rules, 1962 filed by the appellant. In Para 7 of the order, the Hon'ble Tribunal has reproduced the finding of the Ld. Commissioner of Income-tax (Appeals), sustaining addition of Rs.19,42,500/-. In Para(s) 8 and 9, the Hon'ble Tribunal considered the submissions of both the appellant and the Ld. D. R.. In Para 10 of the order, the Hon'ble Tribunal has observed as under:- "10. We have considered the submissions of both the parties and carefully gone through the material available on the record. In the present case, it is not in dispute that the assessee was holding land but no evidence was furnished before the authorities below for earning of agricultural income and even in the returns of income for the preceding years up to assessment year 2006-07, no agricultural income was shown. The assessee in his cash flow statement had shown opening balance of Rs.21,48,000/- and had claimed that the deposit on various dates was from the cash balance but no explanation was given as to why the cash was not deposited at once when it was available with the assessee and was not required for any other purpose, rather the explanation of the assessee was that the amount was deposited on various dates and also deposit had been kept below Rs.50,0001-. The said explanation does not appear to be plausible. Furthermore, no confirmation from the farmer that he had paid the impugned amount was furnished to the authorities below. We, therefore, considering the totality of the facts are of the view that in the absence of any satisfactory evidence and cogent evidence furnished by the assessee, the Ld. CIT(A) was fully justified in sustaining the addition made by the AD. We do not see any valid ground to interfere with the findings given by the Ld. CIT(A)" It is respectful submission of the appellant that the Hon'ble Tribunal has committed errors of fact in the above paragraph of the judgment, Having MA No.356/Del./2018 3 held that in the present case it was not in dispute that the appellant was holding agricultural land, the Hon'ble Tribunal committed error in holding that no evidence was furnished before the lower authorities for earning of agricultural income and even in the returns of income for the preceding years, 2006-07, no agricultural income was shown. It is respectfully submitted that it was pleaded before the lower authorities that the appellant derives income from agricultural land owned by him. In relation to the above averment, the appellant had furnished a Paper Book in the following undisputed evidence:- 1. Agreement with the farmers cultivating the land of the appellant regarding cultivation and earning of agricultural income through him. 2. That appellant also filed a certificate issued by the Rubber Board, A Central Govt. Organization, which clearly points out that the appellant's land was being cultivated for production of Rubber. Further, the appellant also, in the Paper-Book, has submitted a write up about the process as to how the income is derived from the cultivation of rubber trees. (Kindly refer Page No.(s) 14,15 & 16) of the Paper Book filed on dt. 10.08.2017 before Hon'ble ITAT). That in the submissions before the Hon'ble Commissioner of Income-tax (Appeals) it was explained that the rubber plantation resulted in the yield of rubber, once in five years. This explains the fact that the appellant cannot disclose income from agriculture from year to year basis. Once the rubber tree is planted, the yield of raw material for rubber/latex is extracted only in fifth year. All these facts have not been considered by the Hon'ble Tribunal in the finding recorded in Para 10 of the order. In Para 10 again, the Hon'ble Tribunal has faulted the appellant on the opening cash balance of Rs.21,48,000/-, which according to the appellant was deposited on various dates. Whether the appellant deposits the amount of Rs.21,48,000/- on one day or on several days that would not militate against the claim of the appellant of having received agricultural income from the land which was under cultivation. The Hon'ble Tribunal has incorrectly rejected the appellant's statement that the deposits were made below Rs.50,000/- on various dates. The Hon'ble Tribunal has also recorded a wrong finding that there was no confirmation from the farmer regarding income given to the appellant as having emanated from the cultivation and production of rubber. In this regard, it is submitted that before the lower authorities also, the appellant had pleaded for the summoning of the farmer for examining him u/s. 131 of the Act in respect of the agricultural income earned by the appellant. The lower authorities had made no efforts in this regard to confirm the factual position from the farmer to ascertain the nature and extent of agricultural income derived from the cultivation of rubber trees. MA No.356/Del./2018 4 That while parting in this application, it is respectfully submitted that the facts and circumstances of the case prove beyond doubt that the land owned by the appellant was cultivated and harvested for production and manufacture of rubber. This supported the direct evidence submitted by the appellant regarding the agreement with the farmer and the fact that in the agricultural operation of harvesting rubber, the gestation period was five years for extraction of latex which was converted to rubber for commercial use. In view of the above submission pointing out errors Para 10 of the order of the Hon'ble ITAT, it is prayed that the Hon'ble Tribunal may graciously be pleased to exercise powers vested u/s. 254(2) of the Act and rectify the order by re-calling the findings recorded in Para 10 of the order and in deciding the ground of appeal raised by the appellant in respect of addition of Rs.19,42,500/- by directing the lower authorities to examine the farmer in respect of the claim of having given to the appellant a sum of Rs. 19,50,0001- as the agricultural income arising from the cultivation of the land owned by the appellant.” 4. Ld. DR of the Revenue in his arguments submitted that assessee is seeking a review of the order of ITAT in the garb of rectification of mistake and the same is not permissible under section 254(2) of the Income-tax Act, 1961 (for short ‘the Act’) . 5. Upon careful consideration, we find ourselves in agreement with the submissions of ld. DR. Section 254 (2) of the Act only permits rectification of mistake apparent from record. ITAT has no power to rectify its own order. A mistake apparent from record would be the one which is an obvious and patent mistake, which is apparent from record and not a mistake which requires to be established by arguments and a long drawn process of reasoning. Moreover the prayer in the misc. application is for a remand of the issue to the file of AO, as against the issue in the appeal which was challenge to the addition u/s 68 of the MA No.356/Del./2018 5 Act. Hence, we are of the considered opinion that there is no mistake apparent from record in this case, which is liable of rectification u/s 254(2). 6. In our above conclusion, we drew support from Hon’ble Bombay High Court in the case of CIT vs. Ramesh Electric and Trading Co. 203 ITR 497 for the following proposition :- “In fact, we find that the decision in the case of Balaram v. Volkart Brothers, was not brought to the attention of the learned judges who decided the above case. In our view, the power of rectification under section 254(2) of the Income-tax Act can be exercised only when the mistake which is sought to be rectified as an obvious and patent mistake which is apparent from the record, and not a mistake which requires to be established by arguments and a long drawn process of reasoning on points on which there may conceivably be two opinions, as has been shown in the present case. Failure by the Tribunal to consider an argument advanced by either party for arriving at a conclusion is not an error apparent on the record, although it may be an error of judgment. In the present case, the alleged failure, at least on one count, is attributed by the assessee to the Income-tax Officer and not the Tribunal. In our view, the Tribunal had no jurisdiction under section 254(2) to pass the second order.” 7. In the result, the misc. application stands dismissed. Order pronounced in the open court on this day of 7 th June, 2022. Sd/- sd/- (KUL BHARAT) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated the 7 th day of June, 2022 TS MA No.356/Del./2018 6 Copy forwarded to: 1.Appellant 2.Respondent 3.CIT 4.CIT (A) 5.CIT(ITAT), New Delhi. AR, ITAT NEW DELHI.