INCOME TAX OFFICER WARD 23(1)(2), MUMBAI V. GE CAPITAL SERVICES INDIA, MUMBAI

MA 407/MUM/2017

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 4926 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 7 month(s) 4 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 24-03-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2007-2008
• Appeal Filed On: 20-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Principle of natural justice; Maximum Marginal Rate; Revocable transfer; Sham transactions; Set aside
• Section: 263; 63; 143(3); 250; 254(2); 113; 48; 115A; 72; 13

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL “F” Bench, Mumbai Shri Shamim Yahya (AM) & Shri Vikas Awasthy (JM) M.A. No. 407/Mum/2017 in I.T.A. No. 1080/Mum/2016 (A.Y. 2007-08) M.A. No. 408/Mum/2017 in I.T.A. No. 1682/Mum/2016 (A.Y. 2009-10) M.A. No. 409/Mum/2017 in I.T.A. No. 1665/Mum/2016 (A.Y. 2009-10) M.A. No. 410/Mum/2017 in I.T.A. No. 1675/Mum/2016 (A.Y. 2010-11) M.A. No. 411/Mum/2017 in I.T.A. No. 1666/Mum/2016 (A.Y. 2009-10) M.A. No. 412/Mum/2017 in I.T.A. No. 1692/Mum/2016 (A.Y. 2010-11) M.A. No. 413/Mum/2017 in I.T.A. No. 1696/Mum/2016 (A.Y. 2007-08) M.A. No. 414/Mum/2017 in I.T.A. No. 1678/Mum/2016 (A.Y. 2007-08) M.A. No. 415/Mum/2017 in I.T.A. No. 1672/Mum/2016 (A.Y. 2007-08) M.A. No. 416/Mum/2017 in I.T.A. No. 1670/Mum/2016 (A.Y. 2009-10) M.A. No. 417/Mum/2017 in I.T.A. No. 1685/Mum/2016 (A.Y. 2010-11) M.A. No. 418/Mum/2017 in I.T.A. No. 1690/Mum/2016 (A.Y. 2009-10) M.A. No. 419/Mum/2017 in I.T.A. No. 1683/Mum/2016 (A.Y. 2010-11) M.A. No. 420/Mum/2017 in I.T.A. No. 1674/Mum/2016 (A.Y. 2007-08) GE Capital Services India & Loan Trust (Group cases) 2 M.A. No. 421/Mum/2017 in I.T.A. No. 1689/Mum/2016 (A.Y. 2010-11) M.A. No. 422/Mum/2017 in I.T.A. No. 1688/Mum/2016 (A.Y. 2010-11) M.A. No. 424/Mum/2017 in I.T.A. No. 1677/Mum/2016 (A.Y. 2009-10) M.A. No. 425/Mum/2017 in I.T.A. No. 1680/Mum/2016 (A.Y. 2010-11) M.A. No. 426/Mum/2017 in I.T.A. No. 1668/Mum/2016 (A.Y. 2009-10) M.A. No. 427/Mum/2017 in I.T.A. No. 1669/Mum/2016 (A.Y. 2009-10) M.A. No. 428/Mum/2017 in I.T.A. No. 1681/Mum/2016 (A.Y. 2010-11) M.A. No. 429/Mum/2017 in I.T.A. No. 1694/Mum/2016 (A.Y. 2010-11) M.A. No. 465/Mum/2017 in I.T.A. No. 1679/Mum/2016 (A.Y. 2009-10) M.A. No. 466/Mum/2017 in I.T.A. No. 1686/Mum/2016 (A.Y. 2010-11) M.A. No. 467/Mum/2017 in I.T.A. No. 1684/Mum/2016 (A.Y. 2009-10) M.A. No. 468/Mum/2017 in I.T.A. No. 1676/Mum/2016 (A.Y. 2009-10) M.A. No. 469/Mum/2017 in I.T.A. No. 1671/Mum/2016 (A.Y. 2008-09) M.A. No. 470/Mum/2017 in I.T.A. No. 1693/Mum/2016 (A.Y. 2010-11) M.A. No. 471/Mum/2017 in I.T.A. No. 1695/Mum/2016 (A.Y. 2007-08) M.A. No. 472/Mum/2017 in I.T.A. No. 1673/Mum/2016 (A.Y. 2007-08) GE Capital Services India & Loan Trust (Group cases) 3 M.A. No. 473/Mum/2017 in I.T.A. No. 1687/Mum/2016 (A.Y. 2010-11) M.A. No. 474/Mum/2017 in I.T.A. No. 1691/Mum/2016 (A.Y. 2010-11) M.A. No. 475/Mum/2017 in I.T.A. No. 1667/Mum/2016 (A.Y. 2009-10) ITO Ward 23(1)(2)/19(3)(2) Vs. GE Capital Services India PAN : (Appellant) (Respondent) M.A. No. 479/Mum/2017 in I.T.A. No. 3954/Mum/2014 (A.Y. 2010-11) ITO Ward 23(1)(2)/19(3)(2) Vs. Indian Commercial Loan Trust Series-III-2010 PAN : AAATI7698J (Appellant) (Respondent) M.A. No. 423/Mum/2017 in I.T.A. No. 4343/Mum/2013 (A.Y. 2009-10) M.A. No. 477/Mum/2017 in I.T.A. No. 3986/Mum/2013 (A.Y. 2009-10) ITO Ward 19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series 14 PAN : (Appellant) (Respondent) M.A. No. 430/Mum/2017 in I.T.A. No. 4781/Mum/2014 (A.Y. 2009-10) M.A. No. 431/Mum/2017 in I.T.A. No. 5453/Mum/2014 (A.Y. 2010-11) M.A. No. 433/Mum/2017 in I.T.A. No. 3178/Mum/2014 (A.Y. 2010-11) GE Capital Services India & Loan Trust (Group cases) 4 M.A. No. 434/Mum/2017 in I.T.A. No. 4066/Mum/2014 (A.Y. 2009-10) M.A. No. 439/Mum/2017 in I.T.A. No. 5720/Mum/2014 (A.Y. 2010-11) M.A. No. 440/Mum/2017 in I.T.A. No. 4784/Mum/2014 (A.Y. 2009-10) ITO Ward 19(3)(2) Vs. PFL Loan Trust PAN : AABTP4902D (Appellant) (Respondent) M.A. No. 436/Mum/2017 in I.T.A. No. 3624/Mum/2014 (A.Y. 2009-10) ITO Ward 19(3)(2) Vs. PFS Loan Trust PAN : (Appellant) (Respondent) M.A. No. 441/Mum/2017 in I.T.A. No. 5716/Mum/2014 (A.Y. 2010-11) ITO Ward 19(3)(2) Vs. PES Loan Trust PAN : AABTP5019M (Appellant) (Respondent) M.A. No. 435/Mum/2017 in I.T.A. No. 5455/Mum/2014 (A.Y. 2010-11) M.A. No. 437/Mum/2017 in I.T.A. No. 5718/Mum/2014 (A.Y. 2010-11) M.A. No. 438/Mum/2017 in I.T.A. No. 4092/Mum/2014 (A.Y. 2009-10) ITO Ward 19(3)(2) Vs. PSE Loan Trust PAN : AABTP4903C (Appellant) (Respondent) M.A. No. 670/Mum/2017 in I.T.A. No. 7677/Mum/2013 (A.Y. 2008-09) GE Capital Services India & Loan Trust (Group cases) 5 ITO Ward 19(3)(2) Vs. KES Loan Trust PAN : AABTK2892B (Appellant) (Respondent) M.A. No. 512/Mum/2017 in I.T.A. No. 3698/Mum/2014 (A.Y. 2010-11) ITO Ward 23(1)(2) Vs. Indian Corporate Loan Securitization Trust-2008 Series-28 PAN : AAATI6704K (Appellant) (Respondent) M.A. No. 476/Mum/2017 in I.T.A. No. 5758/Mum/2014 (A.Y. 2007-08) M.A. No. 571/Mum/2017 in I.T.A. No. 5513/Mum/2017 (A.Y. 2007-08) ITO Ward 19(3)(2) Vs. IRE Loan Trust PAN : AAATI5498L (Appellant) (Respondent) M.A. No. 483/Mum/2017 in I.T.A. No. 4783/Mum/2013 (A.Y. 2009-10) M.A. No. 577/Mum/2017 in I.T.A. No. 4945/Mum/2013 (A.Y. 2009-10) ITO Ward 19(3)(2) Vs. IWH Loan Trust PAN : AAATI6707L (Appellant) (Respondent) M.A. No. 484/Mum/2017 in I.T.A. No. 3987/Mum/2013 (A.Y. 2009-10) M.A. No. 525/Mum/2017 in I.T.A. 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No. 4034/Mum/2013 (A.Y. 2009-10) M.A. No. 487/Mum/2017 in I.T.A. No. 5980/Mum/2014 (A.Y. 2010-11) GE Capital Services India & Loan Trust (Group cases) 7 M.A. No. 576/Mum/2017 in I.T.A. No. 4338/Mum/2013 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-VI PAN : AAATI6822Q (Appellant) (Respondent) M.A. No. 488/Mum/2017 in I.T.A. No. 4088/Mum/2014 (A.Y. 2010-11) M.A. No. 581/Mum/2017 in I.T.A. No. 3943/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. ITCCL Loan Trust PAN : AAATI6709E (Appellant) (Respondent) M.A. No. 489/Mum/2017 in I.T.A. No. 5715/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. ISH Loan Trust PAN : AAATI6569C (Appellant) (Respondent) M.A. No. 503/Mum/2017 in I.T.A. No. 4089/Mum/2014 (A.Y. 2010-11) M.A. No. 539/Mum/2017 in I.T.A. No. 1611/Mum/2013 (A.Y. 2009-10) M.A. No. 595/Mum/2017 in I.T.A. No. 3942/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. ITBL Loan Trust PAN : AAATI6745A (Appellant) (Respondent) M.A. No. 504/Mum/2017 in I.T.A. 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India Structured Asset Trust Series-III PAN : AAATI6792H (Appellant) (Respondent) GE Capital Services India & Loan Trust (Group cases) 16 M.A. No. 542/Mum/2017 in I.T.A. No. 5067/Mum/2013 (A.Y. 2009-10) ITO-19(3)(2) Vs. India Structured Asset Trust Series IV PAN : AAATI6783J (Appellant) (Respondent) M.A. No. 543/Mum/2017 in I.T.A. No. 1436/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. India Structured Asset Trust 2008- Series-II PAN : AAATI6793G (Appellant) (Respondent) M.A. No. 496/Mum/2017 in I.T.A. No. 5717/Mum/2014 (A.Y. 2010-11) M.A. No. 530/Mum/2017 in I.T.A. No. 4039/Mum/2013 (A.Y. 2010-11) M.A. No. 588/Mum/2017 in I.T.A. No. 5724/Mum/2014 (A.Y. 2010-11) M.A. No. 622/Mum/2017 in I.T.A. No. 4340/Mum/2013 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-II PAN : AAATI6347L (Appellant) (Respondent) M.A. No. 520/Mum/2017 in I.T.A. No. 3776/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Commercial Loan Trust Series-IX 2009 PAN : AAATI6713L (Appellant) (Respondent) GE Capital Services India & Loan Trust (Group cases) 17 M.A. No. 615/Mum/2017 in I.T.A. No. 3731/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Commercial Loan Trust Series-IX 2008 PAN :AAATI6913L (Appellant) (Respondent) M.A. No. 521/Mum/2017 in I.T.A. No. 4104/Mum/2014 (A.Y. 2010-11) M.A. No. 612/Mum/2017 in I.T.A. No. 3934/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Commercial Loan Trust Series-VII-2008 PAN : AAATI6749N (Appellant) (Respondent) M.A. No. 519/Mum/2017 in I.T.A. No. 3702/Mum/2014 (A.Y. 2010-11) M.A. No. 613/Mum/2017 in I.T.A. No. 3738/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Commercial Loan Trust Series-V-2009 PAN : AAATI7907A (Appellant) (Respondent) M.A. No. 529/Mum/2017 in I.T.A. No. 1437/Mum/2014 (A.Y. 2009-10) M.A. No. 535/Mum/2017 in I.T.A. No. 3619/Mum/2014 (A.Y. 2010-11) M.A. No. 621/Mum/2017 in I.T.A. No. 943/Mum/2014 (A.Y. 2009-10) M.A. No. 627/Mum/2017 in I.T.A. No. 3336/Mum/2014 (A.Y. 2010-11) GE Capital Services India & Loan Trust (Group cases) 18 ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-XLI PAN : AAATI6923N (Appellant) (Respondent) M.A. No. 517/Mum/2017 in I.T.A. No. 4037/Mum/2013 (A.Y. 2009-10) M.A. No. 536/Mum/2017 in I.T.A. No. 5723/Mum/2014 (A.Y. 2010-11) M.A. No. 614/Mum/2017 in I.T.A. No. 4334/Mum/2013 (A.Y. 2009-10) M.A. No. 628/Mum/2017 in I.T.A. No. 5273/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-24 PAN : AAATI6916R (Appellant) (Respondent) M.A. No. 538/Mum/2017 in I.T.A. No. 1442/Mum/2014 (A.Y. 2009-10) M.A. No. 630/Mum/2017 in I.T.A. No. 1142/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. India Structured Asset Trust Series-VIII PAN : AAATI6916R (Appellant) (Respondent) M.A. No. 631/Mum/2017 in I.T.A. No. 3936/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Structural Asset Trust Series-II PAN : AAATI6793G (Appellant) (Respondent) GE Capital Services India & Loan Trust (Group cases) 19 M.A. No. 575/Mum/2017 in I.T.A. No. 1139/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. India Structural Asset Trust PAN : AAATI6792H (Appellant) (Respondent) M.A. No. 632/Mum/2017 in I.T.A. No. 3937/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Structural Asset Trust Series-III PAN : AAATI6792H (Appellant) (Respondent) M.A. No. 633/Mum/2017 in I.T.A. No. 4948/Mum/2013 (A.Y. 2009-10) M.A. No. 637/Mum/2017 in I.T.A. No. 5270/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Structural Asset Trust Series-IV PAN : AAATI6793J (Appellant) (Respondent) M.A. No. 507/Mum/2017 in I.T.A. No. 3611/Mum/2014 (A.Y. 2010-11) M.A. No. 547/Mum/2017 in I.T.A. No. 1188/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Loan Receivable Trust February-2008 PAN : AAATI6493F (Appellant) (Respondent) M.A. No. 514/Mum/2017 in I.T.A. No. 5726/Mum/2014 (A.Y. 2010-11) GE Capital Services India & Loan Trust (Group cases) 20 M.A. No. 548/Mum/2017 in I.T.A. No. 1183/Mum/2014 (A.Y. 2009-10) M.A. No. 606/Mum/2017 in I.T.A. No. 5271/Mum/2014 (A.Y. 2010-11) M.A. No. 639/Mum/2017 in I.T.A. No. 466/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust-2008 Series-XLVII PAN : AAATI6930P (Appellant) (Respondent) M.A. No. 537/Mum/2017 in I.T.A. No. 5725/Mum/2014 (A.Y. 2010-11) M.A. No. 549/Mum/2017 in I.T.A. No. 1186/Mum/2014 (A.Y. 2009-10) M.A. No. 629/Mum/2017 in I.T.A. No. 5272/Mum/2014 (A.Y. 2010-11) M.A. No. 640/Mum/2017 in I.T.A. No. 464/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-13 PAN : AAATI6926K (Appellant) (Respondent) M.A. No. 551/Mum/2017 in I.T.A. No. 4038/Mum/2013 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-VII PAN : AAATI6919A (Appellant) (Respondent) GE Capital Services India & Loan Trust (Group cases) 21 M.A. No. 550/Mum/2017 in I.T.A. No. 3693/Mum/2014 (A.Y. 2010-11) M.A. No. 552/Mum/2017 in I.T.A. No. 4091/Mum/2014 (A.Y. 2009-10) M.A. No. 641/Mum/2017 in I.T.A. No. 3927/Mum/2017 (A.Y. 2010-11) M.A. No. 643/Mum/2017 in I.T.A. No. 3734/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-XI PAN : AAATI7010C (Appellant) (Respondent) M.A. No. 554/Mum/2017 in I.T.A. No. 1440/Mum/2014 (A.Y. 2009-10) M.A. No. 645/Mum/2017 in I.T.A. No. 1140/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. India Commercial Loan Trust Series-II-2008 PAN : AAATI6347L (Appellant) (Respondent) M.A. No. 604/Mum/2017 in I.T.A. No. 3929/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-28 PAN : AAATI6704K (Appellant) (Respondent) M.A. No. 560/Mum/2017 in I.T.A. No. 3988/Mum/2013 (A.Y. 2009-10) M.A. No. 651/Mum/2017 in I.T.A. No. 4339/Mum/2013 (A.Y. 2009-10) GE Capital Services India & Loan Trust (Group cases) 22 ITO-19(3)(2) Vs. India Corporate Loan Securitization T rust 2008 Series-09 PAN : AAATI6932R (Appellant) (Respondent) M.A. No. 562/Mum/2017 in I.T.A. No. 3955/Mum/2014 (A.Y. 2010-11) M.A. No. 652/Mum/2017 in I.T.A. No. 3938/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Structural Asset Trust Series-6 PAN : AAATI6911J (Appellant) (Respondent) M.A. No. 563/Mum/2017 in I.T.A. No. 3780/Mum/2014 (A.Y. 2010-11) M.A. No. 653/Mum/2017 in I.T.A. No. 3939/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Structural Asset Trust Series-VII PAN : AAATI6915N (Appellant) (Respondent) M.A. No. 526/Mum/2017 in I.T.A. No. 4097/Mum/2014 (A.Y. 2010-11) M.A. No. 607/Mum/2017 in I.T.A. No. 3940/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Structural Asset Trust Series-XI PAN : AAATI7291R (Appellant) (Respondent) M.A. No. 515/Mum/2017 in I.T.A. No. 3700/Mum/2014 (A.Y. 2010-11) GE Capital Services India & Loan Trust (Group cases) 23 M.A. No. 608/Mum/2017 in I.T.A. No. 3745/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-38 PAN : AAATI6928H (Appellant) (Respondent) M.A. No. 516/Mum/2017 in I.T.A. No. 3617/Mum/2014 (A.Y. 2010-11) M.A. No. 561/Mum/2017 in I.T.A. No. 4036/Mum/2013 (A.Y. 2009-10) M.A. No. 609/Mum/2017 in I.T.A. No. 3335/Mum/2014 (A.Y. 2010-11) M.A. No. 654/Mum/2017 in I.T.A. No. 4335/Mum/2013 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-18 PAN : AAATI6933Q (Appellant) (Respondent) M.A. No. 518/Mum/2017 in I.T.A. No. 3777/Mum/2017 (A.Y. 2010-11) M.A. No. 610/Mum/2017 in I.T.A. No. 3743/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Commercial Loan Trust Series-I-2009 PAN : AAATI7906B (Appellant) (Respondent) M.A. No. 522/Mum/2017 in I.T.A. No. 5740/Mum/2014 (A.Y. 2007-08) M.A. No. 611/Mum/2017 in I.T.A. No. 5510/Mum/2014 (A.Y. 2007-08) GE Capital Services India & Loan Trust (Group cases) 24 ITO-19(3)(2) Vs. IGHCC 3 Loan Trust PAN : AAATI5213R (Appellant) (Respondent) M.A. No. 523/Mum/2017 in I.T.A. No. 5742/Mum/2014 (A.Y. 2007-08) M.A. No. 616/Mum/2017 in I.T.A. No. 5511/Mum/2014 (A.Y. 2007-08) ITO-19(3)(2) Vs. IGHCC 2 Loan Trust PAN : AAATI5212Q (Appellant) (Respondent) M.A. No. 524/Mum/2017 in I.T.A. No. 5741/Mum/2014 (A.Y. 2007-08) M.A. No. 617/Mum/2017 in I.T.A. No. 5512/Mum/2014 (A.Y. 2007-08) ITO-19(3)(2) Vs. IGHCC Loan Trust PAN : AAATI5039H (Appellant) (Respondent) M.A. No. 527/Mum/2017 in I.T.A. No. 3610/Mum/2014 (A.Y. 2010-11) M.A. No. 564/Mum/2017 in I.T.A. No. 1191/Mum/2014 (A.Y. 2009-10) M.A. No. 619/Mum/2017 in I.T.A. No. 2722/Mum/2014 (A.Y. 2010-11) M.A. No. 655/Mum/2017 in I.T.A. No. 472/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Loan Receivable Trust May-2008 PAN : AAATI6557P (Appellant) (Respondent) GE Capital Services India & Loan Trust (Group cases) 25 M.A. No. 532/Mum/2017 in I.T.A. No. 3699/Mum/2014 (A.Y. 2010-11) M.A. No. 567/Mum/2017 in I.T.A. No. 1184/Mum/2014 (A.Y. 2009-10) M.A. No. 624/Mum/2017 in I.T.A. No. 3742/Mum/2014 (A.Y. 2010-11) M.A. No. 658/Mum/2017 in I.T.A. No. 468/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-33 PAN : AAATI616B (Appellant) (Respondent) M.A. No. 492/Mum/2017 in I.T.A. No. 3953/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Indian Commercial Loan Trust Series-VI-2009 PAN : AAATI7603M (Appellant) (Respondent) M.A. No. 493/Mum/2017 in I.T.A. No. 3774/Mum/2014 (A.Y. 2010-11) M.A. No. 585/Mum/2017 in I.T.A. No. 3925/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-VIII PAN : AAATI7008J (Appellant) (Respondent) M.A. No. 494/Mum/2017 in I.T.A. No. 4781/Mum/2013 (A.Y. 2009-10) M.A. No. 495/Mum/2017 in I.T.A. No. 3703/Mum/2014 (A.Y. 2010-11) GE Capital Services India & Loan Trust (Group cases) 26 M.A. No. 586/Mum/2017 in I.T.A. No. 4943/Mum/2013 (A.Y. 2009-10) M.A. No. 587/Mum/2017 in I.T.A. No. 3946/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. IEL Loan Trust PAN : AAATI6596H (Appellant) (Respondent) M.A. No. 531/Mum/2017 in I.T.A. No. 3620/Mum/2014 (A.Y. 2010-11) M.A. No. 568/Mum/2017 in I.T.A. No. 1190/Mum/2014 (A.Y. 2009-10) M.A. No. 659/Mum/2017 in I.T.A. No. 465/Mum/2014 (A.Y. 2009-10) M.A. No. 623/Mum/2017 in I.T.A. No. 3334/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-LXI PAN : AAATI7007H (Appellant) (Respondent) M.A. No. 565/Mum/2017 in I.T.A. No. 3613/Mum/2014 (A.Y. 2010-11) M.A. No. 662/Mum/2017 in I.T.A. No. 542/Mum/2014 (A.Y. 2009-10) M.A. No. 570/Mum/2017 in I.T.A. No. 1185/Mum/2014 (A.Y. 2009-10) M.A. No. 656/Mum/2017 in I.T.A. No. 3331/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. India Corporate Loan Securitization Trust 2008 Series-39 GE Capital Services India & Loan Trust (Group cases) 27 PAN : AAATI6790F (Appellant) (Respondent) M.A. No. 566/Mum/2017 in I.T.A. No. 3607/Mum/2013 (A.Y. 2010-11) M.A. No. 569/Mum/2017 in I.T.A. No. 1438/Mum/2014 (A.Y. 2009-10) M.A. No. 657/Mum/2017 in I.T.A. No. 2718/Mum/2014 (A.Y. 2010-11) M.A. No. 660/Mum/2017 in I.T.A. No. 942/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-40 PAN : AAATI6784R (Appellant) (Respondent) M.A. No. 506/Mum/2017 in I.T.A. No. 3616/Mum/2014 (A.Y. 2010-11) M.A. No. 572/Mum/2017 in I.T.A. No. 1182/Mum/2017 (A.Y. 2009-10) M.A. No. 598/Mum/2017 in I.T.A. No. 2719/Mum/2014 (A.Y. 2010-11) M.A. No. 661/Mum/2017 in I.T.A. No. 467/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Indian Corporate Loan Securitization Trust 2008 Series-LVI PAN : AAATI6748P (Appellant) (Respondent) M.A. No. 663/Mum/2017 in I.T.A. No. 5761/Mum/2014 (A.Y. 2007-08) ITO-19(3)(2) Vs. KJS Loan Trust GE Capital Services India & Loan Trust (Group cases) 28 PAN : AABTK1729R (Appellant) (Respondent) M.A. No. 677/Mum/2017 in I.T.A. No. 3773/Mum/2014 (A.Y. 2010-11) M.A. No. 679/Mum/2017 in I.T.A. No. 3741/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. KEC Loan Trust PAN : AABTK2892B (Appellant) (Respondent) M.A. No. 667/Mum/2017 in I.T.A. No. 3621/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. KBL Loan Trust PAN : AABTK2888F (Appellant) (Respondent) M.A. No. 674/Mum/2017 in I.T.A. No. 4947/Mum/2014 (A.Y. 2009-10) M.A. No. 676/Mum/2017 in I.T.A. No. 2726/Mum/2014 (A.Y. 2010-11) M.A. No. 669/Mum/2017 in I.T.A. No. 4786/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. KBA Loan Trust PAN : AABTK2888F (Appellant) (Respondent) M.A. No. 665/Mum/2017 in I.T.A. No. 3608/Mum/2014 (A.Y. 2009-10) M.A. No. 675/Mum/2017 in I.T.A. No. 2727/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. KUL Loan Trust PAN : AABTK2887L (Appellant) (Respondent) GE Capital Services India & Loan Trust (Group cases) 29 M.A. No. 664/Mum/2017 in I.T.A. No. 4093/Mum/2014 (A.Y. 2009-10) M.A. No. 673/Mum/2017 in I.T.A. No. 3956/Mum/2014 (A.Y. 2010-11) M.A. No. 678/Mum/2017 in I.T.A. No. 3947/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. KAG Loan Trust PAN : AABTK3092R (Appellant) (Respondent) M.A. No. 680/Mum/2017 in I.T.A. No. 5517/Mum/2014 (A.Y. 2007-08) M.A. No. 668/Mum/2017 in I.T.A. No. 5737/Mum/2014 (A.Y. 2007-08) ITO-19(3)(2) Vs. KGE Loan Trust PAN : AABTK1391D (Appellant) (Respondent) M.A. No. 666/Mum/2017 in I.T.A. No. 3704/Mum/2014 (A.Y. 2010-11) M.A. No. 672/Mum/2017 in I.T.A. No. 1444/Mum/2014 (A.Y. 2009-10) M.A. No. 671/Mum/2017 in I.T.A. No. 944/Mum/2014 (A.Y. 2009-10) M.A. No. 681/Mum/2017 in I.T.A. No. 3948/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. KSE Loan Trust PAN : AABTK3186G (Appellant) (Respondent) M.A. No. 442/Mum/2017 in I.T.A. No. 4111/Mum/2014 (A.Y. 2010-11) GE Capital Services India & Loan Trust (Group cases) 30 M.A. No. 443/Mum/2017 in I.T.A. No. 4100/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. SME Retails Pool IV Trust PAN : AAHTS4971R (Appellant) (Respondent) M.A. No. 444/Mum/2017 in I.T.A. No. 4113/Mum/2014 (A.Y. 2009-10) M.A. No. 445/Mum/2017 in I.T.A. No. 4095/Mum/2014 (A.Y. 2009-10) M.A. No. 446/Mum/2017 in I.T.A. No. 4112/Mum/2014 (A.Y. 2010-11) M.A. No. 447/Mum/2017 in I.T.A. No. 4099/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. SME Retails Pool II Trust PAN : AAHTS4356C (Appellant) (Respondent) M.A. No. 448/Mum/2017 in I.T.A. No. 4114/Mum/2014 (A.Y. 2010-11) M.A. No. 449/Mum/2017 in I.T.A. No. 4098/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. SME Loan Receivable Trust August 2007 PAN : AAITS3969E (Appellant) (Respondent) M.A. No. 685/Mum/2017 in I.T.A. No. 5762/Mum/2014 (A.Y. 2007-08) M.A. No. 688/Mum/2017 in I.T.A. No. 4102/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Long Bond Receivable Trust 2007-Series-IV GE Capital Services India & Loan Trust (Group cases) 31 PAN : AAATL5556A (Appellant) (Respondent) M.A. No. 689/Mum/2017 in I.T.A. No. 1187/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Long Bond Receivable Trust 2007-Series-III PAN : (Appellant) (Respondent) M.A. No. 450/Mum/2017 in I.T.A. No. 3732/Mum/2014 (A.Y. 2010-11) M.A. No. 451/Mum/2017 in I.T.A. No. 2721/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Long Bond Receivable Trust 2006-Series-V PAN : AAATL5556A (Appellant) (Respondent) M.A. No. 457/Mum/2017 in I.T.A. No. 2720/Mum/2014 (A.Y. 2009-10) M.A. No. 458/Mum/2017 in I.T.A. No. 5514/Mum/2014 (A.Y. 2007-08) M.A. No. 683/Mum/2017 in I.T.A. No. 3069/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Long Bond Receivable Trust 2006-Series-IV PAN : (Appellant) (Respondent) M.A. No. 452/Mum/2017 in I.T.A. No. 447/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Loan Receivable Trust April 2008 PAN : (Appellant) (Respondent) GE Capital Services India & Loan Trust (Group cases) 32 M.A. No. 453/Mum/2017 in I.T.A. No. 5516/Mum/2014 (A.Y. 2007-08) M.A. No. 456/Mum/2017 in I.T.A. No. 3746/Mum/2014 (A.Y. 2010-11) M.A. No. 682/Mum/2017 in I.T.A. No. 4101/Mum/2014 (A.Y. 2010-11) M.A. No. 686/Mum/2017 in I.T.A. No. 5739/Mum/2014 (A.Y. 2007-08) ITO-19(3)(2) Vs. Long Bond Receivable Trust 2006-Series-III PAN : (Appellant) (Respondent) M.A. No. 454/Mum/2017 in I.T.A. No. 3733/Mum/2014 (A.Y. 2010-11) M.A. No. 455/Mum/2017 in I.T.A. No. 5760/Mum/2014 (A.Y. 2007-08) M.A. No. 684/Mum/2017 in I.T.A. No. 4103/Mum/2014 (A.Y. 2007-08) M.A. No. 687/Mum/2017 in I.T.A. No. 3626/Mum/2014 (A.Y. 2009-10) ITO-19(3)(2) Vs. Long Bond Receivable Trust 2007-Series-V PAN : AAATL5666R (Appellant) (Respondent) M.A. No. 459/Mum/2017 in I.T.A. No. 5722/Mum/2014 (A.Y. 2010-11) M.A. No. 464/Mum/2017 in I.T.A. No. 5577/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Bond Receivable Trust 2006 Series II PAN : AABTB0669H (Appellant) (Respondent) GE Capital Services India & Loan Trust (Group cases) 33 M.A. No. 460/Mum/2017 in I.T.A. No. 3625/Mum/2014 (A.Y. 2009-10) M.A. No. 461/Mum/2017 in I.T.A. No. 5576/Mum/2014 (A.Y. 2010-11) M.A. No. 462/Mum/2017 in I.T.A. No. 3180/Mum/2014 (A.Y. 2009-10) M.A. No. 463/Mum/2017 in I.T.A. No. 5721/Mum/2014 (A.Y. 2010-11) ITO-19(3)(2) Vs. Bond Receivable Trust 2006 Series-I PAN : AABTB0670J (Appellant) (Respondent) Assessee by Shri Percy Pardiwala - Loan Trust Group Ms. Shri Fereshthn Sethne-GE Capital Services Department by Shri P. Chottray & Shri Achal Sharma Date of Hearing 21.01.2022 Date of Pronouncement 25.03.2022 O R D E R Per Bench :- By way of these Miscellaneous Applications Revenue seeks rectification of mistake apparent from record under section 254(2) of the I.T. Act. Since the issues are related and the applications were consolidated and argued together these are being disposed off by this common order. 2. For bunching and grouping of these Miscellaneous Applications department has submitted that there are three categories of Miscellaneous Applications as under :- “Sub.: Bunching of identical MAs in the cases of Loan Trust Group & GE Capital Services India - Submission of information - reg. Date of hearing : 21.01.2022 Ref (1) MA Nos. 423/M/2017 & 477/M/2017 arising out of GE Capital Services India & Loan Trust (Group cases) 34 ITA Nos. 4343/M/2013 & 3986/M/2013 respectively in the case of Indian Corporate Loan Securitisation Trust 2008 Series 14 - Order pronounced on 17.02.2017 (2) MA Nos. 430 to 464/M/2017, 478 to 499/M/2017, 500 to 571/M/2017, 573 to 599/M/2017 and 601 to 689/M/2017 arising out of leading ITA Nos. 5513/M/2014 & 5758/M/2014 in the Group of Loan Trust cases - Order pronounced on 22.02.2017 (3) MA No. 407 to 422/M/2017, 424 to 429/M/2017 and 465 to 475/M/2017 arising out of ITA No. 1080/M/2016 and ITA Nos. 1665 to 1696 in the cases of G. E. Capital Services India Ltd and others -Order pronounced on 22.02.2017 Kindly refer to the above. 2. The above mentioned MAs (Miscellaneous Applications) filed by the Department came up for hearing before the Hon'ble ‘F’ Bench, Mumbai on 07.01.2022. As these MAs have arisen out of ITAs in which above mentioned three orders of Hon'ble ITAT, 'F' Bench, Mumbai were passed having same or similar issues, Hon'ble Members of F' Bench, Mumbai, during the hearing on 07.01.2022, directed the Department as well as the assessees' ARs to bunch the various MAs which are identical and to submit information & details regarding the same to the Hon'ble Bench before the next date of hearing i.e. before 21.01.2022. 3. It is submitted that a total of 280 MAs have been listed for hearing in the cases of Loan Trust Group and GE Capital Services India Ltd. as referred to above. The category-wise information of identical MAs is submitted below. 4. Firstly, in the case of Indian Corporate Loan Securitisation Trust - 2008 Series 14 having ITA Nos. 4343/M/2013 & 3986/M/2013, Order of Hon'ble ITAT, ‘F’ Bench, Mumbai was pronounced on 17.02.2O17. On behalf of the Revenue, these ITAs were represented by Special Counsel Shri P.C. Chhotaray. This Order dated 17.02.2017 is the main order in respect of all the above mentioned cases and it has been followed by the Hon'ble ITAT, ( F' Bench, Mumbai in its subsequent two Orders dated 22.02.2017 mentioned below. The MAs filed against this Order, respective to the above mentioned ITAs, are MA Nos. 423/M/2017 & 477/M/2017 which are identical and these contain 27 paragraphs. 5. Secondly, by following the above stated order dated 17.02.2017, a composite order on 248 appeals in various Loan Trust cases was passed by Hon'ble ITAT, 'F' Bench, Mumbai on 22.02.2017 having the lead ITA Nos. 5513/M/2014 & 5758/M/2014. In respect of these appeals, the Special Counsel Shri P.C. Chhotaray was authorized to represent the lead case having ITA Nos. 5513/M/2014 & 5758/M/2014 and the other cases/ITAs mentioned in this Order were represented by Smt. S. Padmaja. The 245 MAs filed against this Order dated 22.02.2017 as listed for hearing are tabulated GE Capital Services India & Loan Trust (Group cases) 35 below. All these MAs filed against this combined order are identical and these contain 20 paragraphs. 1 MA No. 430 to 464/M/2017 2 MA No. 478 to 499/M/2017 3 MA No. 500 to 571/M/2017 4 MA No. 573 to 599/M/2017 5 MA No. 601 to 689/M/2017 6. Lastly, by again following its above mentioned Order dated 17.02.2017, another composite order in 33 cases of GE Capital & others (Interveners) was passed by Hon,ble ITAT, ‘F’ Bench, Mumbai on 22.02.2017 having the lead ITA No. 1080/M/2016. In respect of these appeals, the Special counsel Shri P.C, Chhotaray was authorized to represent only the lead case having ITA No. 1080/M/2016 and other cases were to be represented by Smt. S. Padmaja. The MAs filed against this order are tabulated below. AH the MAs filed against this combined order are identical and these contain 12 paragraphs. 1 MA No. 407 to 422/M/2017 2 MA No. 424 to 429/M/2017 3 MA No. 465 to 475/M/2017 7. Hence, in conclusion, it is submitted that in the above mentioned cases which were last fixed for hearing on 07.01.2022 and are now fixed for hearing on 21.01.2022, there are three categories of identical M.As details regarding which have been submitted above.” 3. From the above it is evident that there are 280 Miscellaneous Applications which have been agreed by the Revenue to be falling under three categories as noted above. The first category comprises of two Miscellaneous Applications No. 423/Mum/2017 and 477/Mum/2017 arising out order in the case of Indian Corporate Loan Securitization Trust vide order dated 17.2.2017. The second category is arising out of group of Loan Trust cases of 246 Miscellaneous Applications against ITAT order dated 22.2.2017. The third category comprises of 32 Miscellaneous Applications arising out of order in the case of G.E. Capital Services India Ltd. vide order dated 22.2.2017. The leading Miscellaneous Application in this case has been argued by Shri P.Chottray, Counsel for the Revenue, who argued the first category of cases. The rest categories of cases were mentioned by Shri Achal Sharma (CIT-DR). Learned CIT-DR did not make GE Capital Services India & Loan Trust (Group cases) 36 any specific arguments, he relied upon lead arguments made by Shri P. Chottray. Further learned CIT-DR read through the written submissions made by the Department. Thus the main submission on behalf of the Revenue was made by Shri P. Chottray. In the Miscellaneous Applications where he was not appointed by the Revenue, learned CIT-DR drew support from the arguments of Shri P. Chottary. First Category : 4. Since the appeals in this category are common, we are referring Miscellaneous Application No. 423/Mum/2017 arising out of ITA No. 4343/Mum/2013 vide order dated 17.2.2017 in the case of Indian Corporate Loan Securities Trust. (argued by Shri P. Chottray) 5. Learned senior counsel for the Revenue Shri P.C. Chhotaray has submitted that there are various mistakes apparent from record in the ITAT order liable to be rectified u/s. 254(2). In this regard he read through the following mistakes :- “Sub: Order of the ITAT "F" Bench, Mumbai dt.7 th February 2017- Miscellaneous Application- re Ref: l. ITA No. 3986/Mum/2013 AY 2009-10 Indian Corporate Loan Securitization Trust-2008 Series-14 v. Income Tax Officer 9(3)(2) 2. ITA No. 4343/Mum/2013 AY 2009-10 Income Tax Officer 23(l)(2)(Erstwhile ITO-19(3)(2) v. Indian Corporate Loan Securitization Trust -2008 Series-14 This is with reference to the above. The matters of several Loan trusts were consolidated and listed before "F" bench. Please see list enclosed. I was appointed as Special Counsel only in five appeals, i.e. ITA 3986/M/13, ITA 4343/M/13 in the case of Indian Corporate Loan Securitization Trust-2008 Series-14 arid ITA 5758/M/14 and ITA 5513/M/14 in the case of IRE Loan Trust and ITA 1080/M/16 in the case of GE Capital Services India. I represented Revenue in the captioned appeals. The arguments from both sides went on for about 50 hearings from January 2016 to December 2016. After the close of the hearings, as per the directions of the ITAT, I submitted a synopsis of arguments comprising 243 pages dated 16.11.2016. A copy of the synopsis has been forwarded to you by the CIT (DR) and the same is also enclosed for ready reference. GE Capital Services India & Loan Trust (Group cases) 37 2. The ITAT vide its order dt. 17.2.2017 allowed the appeal of the assessee and dismissed the appeal of the Revenue. I am of the opinion that on the basis of my arguments summarized in the written synopsis, the decision of the ITAT is perverse and is not acceptable. Accordingly, this is a fit case for filing appeal against the order of the ITAT. 3. It is my considered opinion that the order of the ITAT is silent on many facts and arguments advanced by me by way of oral as well as written arguments. In some cases facts have been wrongly recorded. Any further appeal before the Hon'ble High Court would be only on questions of law and hence factual mistake and omissions would have to be corrected by the ITAT. Hence, it is important that a Miscellaneous Application should be filed against the order of the ITAT. 4. On perusal of the order of the ITAT, it is observed that the ITAT has not at all dealt with some very important submissions of the Revenue which are also contained in the written synopsis. They have also made some factually wrong observations. These lapses have to be brought to the notice of the ITAT through a miscellaneous application. Unless, these are agitated before the ITAT, it would be difficult to raise them before the High Court. The High Court will hold that these omissions and factual wrong statements have been accepted by the Revenue. Since the summary of the arguments is contained in the written synopsis submitted to the ITAT, it would be easy to point out the omissions and wrong statements. The ITAT may be requested to recall its order and deal with these submissions of the Revenue. The vital submissions which have been omitted to be dealt with and where factually wrong observation has been made are given in the following paragraphs. 5. Scale of evasion and a holistic approach The captioned order of the ITAT gives an impression that it is a simple and isolated appeal. But this is the lead appeal and has been followed later on mechanically in about 250 appeals. This is a scam where the guidelines of the RBI on securitization have been misused on an enormous scale. This has been pointed out at the beginning of the hearing through a warning. A specific list of the large number of trusts was given to the Hon'ble ITAT to highlight the magnitude of the problem where a single concern has floated so many Trusts. In paragraph 9 of the synopsis of arguments it has been stated "9. At the outset it is submitted that this is a case where traditional concepts do not apply. This is case where a holistic view has to be taken considering the conduct of Yes Bank Limited (Originator) and similar other concerns and IL & FS Trust'' Company Limited (ITCL) (Settler and trustee) and the mutual funds (beneficiaries/investors). The evasion of tax is of enormous scale. The core issue is whether the tax should be levied on the trust as a unit or on the beneficiaries/investors separately. One party IF&LS Trust Company Limited has floated about 500 trusts misusing the just introduced Scheme of Securitization of Standard Assets launched by the Reserve Bank of India. It has created fly by night trusts that exist for a short time. They induced the mutual funds to invest, promising high returns free of tax. Thereafter, the trust disappears and the beneficiary mutual funds face the tax demand GE Capital Services India & Loan Trust (Group cases) 38 under section 177(3) of the Act. The colossal misuse of the system has led to a scam. As a result, there has been a de-growth in securitization; the securitization scheme has been seriously affected. The action of these persons had devastating adverse effect on the scheme of securitization. It requires tough measures. This background may be kept in mind while deciding this case." These arguments have been elaborated in paragraphs 9, 10 and 11 (pages 4 to 8) of the synopsis. CIT (A) has held that the trust was a farce and there was need to lift the veil. The judgments of Supreme Court in the cases of CIT v. Durga Prasad More [1971], 82 ITR 540 (SC), Sumati Dayal v. CIT [1995], 214 ITR 801(SC) and McDowell & Co. v. CTO 154 ITR 148(SC) were cited. Yet the order of the ITAT has not made any reference to the magnitude of the issue and the scale of the tax evasion. The Hon'ble ITAT has not dealt with this submission. It has not given any comments on the applicability of the judgments. Judicial discipline demands that when Supreme Courts' judgments are cited, they should be dealt with howsoever briefly. Since the decision in this case would have far reaching effects having very high revenue implications it is requested that the ITAT may specifically deal with and give its comments on the above submissions of the Revenue. 6. Binding Precedent Ignored The ITAT has not followed the binding precedent of the order of the Co- ordinate Bench which was cited in IGHCC in 1. ITA No.3274/Mum/2012 for A.Y. 2007-08, 2. ITA No.3275/Mum/2012 for A.Y.2007-08, 3. 3276/Mum/2012 for A.Y. 2007-08, 4. ITA No.3277/Mum/2012 for A.Y. 2007-08, 5. ITA No.3278/Mum/2012 for A.Y. 2007-08, 6. 3279/Mum/2012 for A.Y. 2007-08, 6. ITA No.3280/Mum/2012 for A.Y.2007-08, 7. ITA No.3281/Mum/2012 for A.Y. 2007-08, 8. 3282/Mum/2012 for A.Y. 2007-08, 9. 3283/Mum/2012 for A.Y. 2007-08, 10. 3283/Mum/ 2012 for A.Y. 2007-08 dated 28.02.2013. This common judgement was given in respect of as many as ten appeals. This is discussed in pp 9 to 23 of the written synopsis. The order of the ITAT has also not dealt with this judgement and explained why it has not followed the judgement of the-Coordinate Bench. In this regard, the opening-para 14 of the written synopsis is reproduced. BINDING PRECEDENT "14. Since securitization was a new subject, no case laws have been developed. However, there is only one judgment on the subject of the securitization by the ITAT, D Bench, Mumbai date% 28 th February, 2013 [Ex. 6, DPB Vol. IV, P.22]. This is a common judgment in respect of ten appeals, ITA Nos.3274 to 3283 of 2012, the lead appeal being IGHCC Loan Trust for A.Y. 2007-08. 32741 Mum /2012, IGHCC Loan Trust v. CIT -19. This judgment delivered in the appeal against the order under section 263 passed by the Commissioner is directly on the issue of securitization. The loan trust cases dealt with in the said judgment by GE Capital Services India & Loan Trust (Group cases) 39 Hon'ble ITAT are identical to the appeal under consideration. The Hon'ble ITAT made in depth examination of the case and rejected the appeal of the assessee. Incidentally, the Id. Senior Counsel of the assessee who cited a large number of judgment's did not cite this judgement which is directly on the issue, particularly when he was the counsel of the assessees in the said cases. The said judgment has given the following findings relating to loan trusts... ... " 6.1 The findings of the ITAT have been summarized in paragraph 15 of the written synopsis as under: "75. After detailed examination of the facts of the above case identical to the case under consideration, the Hon'ble ITAT gave the following findings: (a) The trust is not genuine. It held the trust to be paper entity. It asked: What, then, is a purpose of creating such a paper entity? (b) It noted inconsistencies in the date of different transaction. (c) It did not find any justification and rationale in the transaction. It wondered what is the economic purpose sought to be attained. (d) It observed that what cannot be done directly cannot also in law be done indirectly. (e) It held that the interest income is business income (f) It rejected the claim of revocable transfer (g) It rejected the claim of diversion by overriding title. (h) It made a significant observation - Further, the assessee, under law would be the Trustee (IL & FS Trust Co. Ltd.) and not the individual trusts who have been listed only for the sake of identification, the Trustee being the same. " In paragraph 16 of the written synopsis, it was prayed as under: "16. It is submitted that this judgment given in respect of as many as ten appeals is a binding precedent of a coordinate bench of ITAT Mumbai" Against, the said order the assessee had gone in appeal to the High Court and the appeal is pending. A copy of the memorandum of appeal filed by the assessee in the High Court was filed by the Revenue before the ITAT. It was pointed out that the questions of law and the grounds of appeal of the appeal filed before the High Court clearly show that the first three grounds of appeal- invalidity of the trust, revocable transfer and diversion by overriding title- the assessee has admitted that the order of the Coordinate Bench has gone against the assessee and it has gone in appeal on these issues. (vide para 21 of the written synopsis) 6.2 The CIT(A) and the Assessing Officers have followed this order of the coordinate Bench of the ITAT in IGHCC cited supra. Therefore, the present Bench of the ITAT was bound by this order. This has been discussed in paragraph 25.1 of the written synopsis as under: "25.1. How can the present Hon'ble ITAT can get over this situation? The CIT(A) has upheld the order of the Assessing Officer. Here, the GE Capital Services India & Loan Trust (Group cases) 40 appeals before the Hon'ble ITAT are of two categories. In one category, the Assessing Officer has passed the assessment order before the above order of the Hon'ble ITAT dated 28.02.2013. Those orders -were upheld by the CIT(A) on the basis of the aforesaid order of the Hon'ble ITAT directly on- the three issue. In the second category, the assessment orders were passed after the aforesaid order dated 28. 02.2013 of the Hon'ble ITAT and the Assessing Officer passed the fresh assessment order following the aforesaid order of the Hon'ble IT AT. That order was also upheld by the CIT(A) following the aforesaid order of the Hon'ble ITAT, Thus in all the appeals pending before the Hon'ble IT AT, at present, from the order of the CIT(A), the CIT(A) has followed the earlier order of the Hon'ble ITAT. Thus so far as the first three grounds of appeal — invalidity of the trust, revocable transfer and diversion by overriding title, the issued stands covered in favour of the Revenue by the Co-ordinate Bench of the ITAT "D" Bench Mumbai (supra). Hence the Hon'ble Bench is bound by this decision." Yet the Hon'ble ITAT did not refer to this binding decision, gave contrary decision, even though this decision was extensively discussed by the Revenue at the hearing and in the written synopsis. It is very important to note that the same counsel was the counsel in IGHCC cited supra. He furnished the same documents and advanced the same arguments. [Vide the Ground of Appeal (Q) filed before the High Court (p.19. of the written synopsis) where it is averred --"The appellant submits that all the relevant material i.e. the trust deed, deed of assignment, the relevant provisions of SEBI Guidelines were all available with the Tribunal...)] But his contention was rejected by the co-ordinate Bench. Yet the present Bench accepted the same contentions on the basis of the same material and gave a contrary decision. This Bench has simply reappraised the same facts. Why this binding decision was not followed and even not commented upon in the finding of the ITAT, requires clarification. 6.3 Judicial discipline demands that the ITAT should follow the decision of the Coordinate Bench on the same subject. This principle has been reiterated in the recent decision of the Hon'ble Bombay High Court dt. 22 nd August 2016 in the case of Hatkesh Co-Op. Hsg. Society Ltd. v. Ass. Commissioner of Income Tax Circle-21(1), Mumbai (ITA No.328 of 2014 & others, 317 ITR 47(Bom). The Hon'ble High Court has held that if the subsequent Bench of the Tribunal does not agree with the view of the earlier coordinate bench, then the later Bench should request the President to constitute a larger bench to decide the difference of view on the issue. The operative part of the captioned order of the Hon'ble ITAT, which is not consistent with the order of the earlier coordinate Bench, does not contain any passing reference, leave alone any reason for differing from the precedent order. It is, therefore, requested that the order passed by the Hon'ble ITAT may be recalled and the matter should be referred to the President to constitute a larger bench to decide the appeal. GE Capital Services India & Loan Trust (Group cases) 41 7. Subsequent Amendments In para 26, pp 24 to 35 of the written synopsis, subsequent... amendments and the Mischief Rule have been extensively discussed to stress the point that in the relevant year under consideration the income of the trust was taxable. Though considerable time was devoted by the Revenue at the hearing on this issue, the order of ITAT has not touched on this issue at all and have not dealt with these arguments of the Revenue. It is requested that the ITAT may give its finding on this issue. 8. Revised Guidelines of RBI In pp 45 to 48 it has been discussed how the guidelines of RBI have been misused and RBI had to issue revised guidelines to prevent unhealthy practices. The Hon'ble Bench showed keen interest on this and wanted a copy of the Revised Guidelines. A copy of the Revised Guidelines of RBI was furnished. Yet there is no reference to it in the order. It is requested that the Hon'ble ITAT may comment on this issue, particularly, in view of the fact that there was a mushroom growth of such trusts in the period under consideration in the wake of the first guidelines of the RBI and one entity, i.e. IL&FS floated about 500 trusts. 9. In the title, it should be ITO 19(3)(2) instead of ITO 9(3)(2). This may be corrected. 10. In paragraph 2.1.3 of the order, it is stated: "An Agreement for the loan was purportedly entered into between HPCL and Yes Bank on 15.05,2008 which specified that a standard format agreement shall be executed." This averment is not correct. No such agreement was produced nor discussed during the hearing. As per the records (Vide paragraph 37.(i) p.50 of the written synopsis submitted by me), HPCL gave an acceptance letter on 15.05.2008 a copy of which has been placed at Exhibit 5 of Departmental Paper Book Volume II. A copy of the said letter issued in the letter head of HPCL Ltd. addressed to Yes Bank Ltd. is reproduced below:- "Ref. B&I/VKM/LOANS/ May 15, 2008 Vice President Yes Bank Limited Clean Loan Nehru Centre, 5 th Floor, Discovery of India Worli, MUMBAI 400018 Attn. Shri Manish Jain Dear Sir, This has reference to your electronic quote against our e-bid enquiry no. BNKCLEAN2008053398 for Clean loan of upto 300 crores at an interest rate 9.18% p.a. for a period of upto 364 days. GE Capital Services India & Loan Trust (Group cases) 42 We are pleased to accept your offer and wish to avail loan of Rs.300 crores on 16.5.2008 at interest rate of 9.18% p.a. We request you to transfer the funds to our account with State Bank of India through RTGS on 16.5.2008 as detailed below. Sr. No. Details Description 1 Date of transaction 16.5.2008 2 Amount to be remitted Rs.300, 00, 00, 000 3 Beneficiary's name Hindustan Petroleum Corporation Limited 4 Beneficiary's bank name State Bank of India 5 Beneficiary's branch name Corporate Accounts Group Branch 6 Beneficiary's account number 11083987009 7 Bank's IFSC Code SBIN0009995 We wish to confirm that the present borrowing of Rs.300 crores from Yes Bank will be within the overall borrowing limit of Rs.l7.500 crores approved by Board of Directors vide resolution dated 29.10.2007 and the resolution is valid as of date and has not been rescinded. Very truly Yours Sd./ B. Ravindran DGM-Treasury" 11. This is by no means an agreement of loan. During the hearing no other agreement of loan referred to in the order of the ITAT was produced. The only agreement furnished by assessee was of 21.05.2008. This factual statement which is crucial in many respects is not borne out in the records. This should foe expunged and the correct factual position be stated. 12. In paragraph 2.1.4, it has been stated: "Meanwhile an Information Memorandum dated 20.05.2008 was jointly issued by the assesses and Yes Bank to MF... ..... " This statement is incorrect as when the information memorandum was issued, the assessee was not in existence. The assessee trust was formed later. This should be corrected. 13. In paragraph 2.1.5 (xi) it has been stated: " ...All these transactions have happened between 15.05.2008 (when Yes Bank and HPCL, executed the agreement of intent for the loan) GE Capital Services India & Loan Trust (Group cases) 43 and-21.05,2008, when the standard format agreement was executed between Yes Bank and HPCL. " In this paragraph, the ITAT has used the words ''agreement of intent for the loan", whereas elsewhere in the very same order, this has been called "agreement for the loan". Please see para 10 ante. As explained above, no such agreements purportedly executed on 15.05.2008 were produced. Documents of assignment of loan both dated 20.05.2008 refer to the loan agreement which was entered on 21.05.2008. This is an important fact which has been brushed aside. This requires clarification. 14. Issues of fatal inconsistencies of the documents were exhaustively dealt with by me in several hearing and has been elaborately discussed in the written synopsis of arguments furnished to the ITAT to establish that all these were sham transactions. All these arguments and discussions in the written submission have been glossed over lightly. A new element of agreement of loan purportedly executed/agreement of intent of loan has been referred to in the ITAT Order. No copy of such agreement ever found place in evidence furnished or in oral arguments. HPCL is the obligor to Yes Bank which is seller/originator. Yes -Bank also acts in the capacity of the service provider and no more as the originator of the loan. The roles of Originator and the Service Provider are different. The Service Provider carries out its functions on behalf of the SPY. This fact requires to be brought on record in the order of the ITAT. 15. In paragraph 6.2 of the order of the ITAT it has been stated: "... During the course of the appellate proceedings before us, the learned Senior Counsel for the assessee made detailed oral and written submissions. The written submissions were given to the Revenue and the counter submitted by the Revenue were made available to the assessee and the assessee, in the rejoinder, made submission rebutting Revenue's counter." The above statement is factually incorrect. Before the detailed hearing took place, paper books and written submissions from either side were on record. There were no counters or rejoinders to these. Both parties had access to the other parties submissions. The hearing commenced with Mr. Soli Dastur, Senior Counse-1 representing the assessee and Shri P. C. Chhotaray, Sr. Standing Counsel representing the Revenue. The counsels made exhaustive arguments. The matter was argued in approximately 50 hearings. After conclusions of the hearing both sides filed written synopsis of arguments separately to the ITAT. The written synopsis which embodied the arguments of either side was only given to the ITAT. These were not exchanged between the parties at the express direction of the Hon'ble Bench. The synopsis given by the Sr. Standing Counsel for Revenue comprised 243 (two hundred and forty three) pages. No rejoinder was filed to this by the assessee. Similarly, Revenue was not served with a copy of the written submission filed by the assessee at the conclusion of the hearing and did not submit any counter. Therefore, these observations that written submissions were exchanged and GE Capital Services India & Loan Trust (Group cases) 44 counters were filed is incorrect. These above factual observations may be deleted or suitably modified. 16. In paragraph 6.8.1 of the ITAT order cited under reference, it is stated: "In fact even after all the securitization transactions, HPCL repays the loan and interest to Yes Bank only.” These payments are made to Yes Bank in the capacity of Service Provider only and not as Originate. This fact should be brought on record. 17. Fatal inconsistencies in the Documents In paragraph 6.8.4 of the ITAT order cited under reference it has been observed as under: "Even assuming that minor infirmities exist in the documents, those 'can at best be characterized as procedural defects and this alone is not enough to disregard the documents totally." The Revenue, both during hearing and in the written synopsis of arguments (pp 49 to 106 of the written synopsis) elaborately discussed the critical defects in the documents to establish that these were sham and unreliable documents. Some illustrations as below are extracted from the written synopsis dt 16.1 1.2016: "(xv) P.139A - It is mentioned that CRISIL has assigned the rating. It has further been mentioned that the rating is not a recommendation to purchase, hold or sell the certificates as they do not comment on the market price of the certificates or its suitability to a particular investor. It is further stated that the there is no assurance that the rating will remain at the same level for a given period of time. What is the meaning of these averments when the trust is not formed? At the bottom of this page, there is reference to facility documents which 'include the loan agreement. Similar reference has been made to loan agreement at page 140. But the loan agreement has not been executed by then. The loan document was executed on 21 st May 2008. The mutual funds did not see the loan agreement. This is a false representation, (of pp 69 of the written synopsis dt. 16.11.2016) '' (xxv) At page 148, para 1, it is stated: "Each of the Underlying Documents pertaining to the Loan are genuine and have been duly executed by the Originator and are legally valid and enforceable in accordance with the terms thereof and represent a valid obligation of the obligor." Such an averment and representation has been made in the information memorandum and circulated to the mutual funds when the loan agreement has not been executed. Loan agreement has been executed on 21 s1 May 2008. This is a false and audacious statement GE Capital Services India & Loan Trust (Group cases) 45 inducing the mutual funds to subscribe. But the mutual funds did not question this false statement and made the payment as desired without seeing the loan agreement. This is apparently because the mutual funds were party to the entire conspiracy and, therefore, made huge investments on the basis of apparently inconsistent, document, (of pp 72 of the written synopsis dt. 16.11.2016) 57. This is tripartite agreement between Yes Bank Ltd. in the capacity as seller and Yes Bank Ltd., as servicer and IL&FS Trust Co. Ltd as Trustee. It is also replete with howlers. (i) At page 108A para 3(A) it is stated "The seller has under a loan agreement dated 16 th day of May,2008 (the "Loan Agreement entered" between the Seller and Hindustan Petroleum Corporation Limited ("the Obligor") lent and advanced a loan to the Obligor for financing its working capital requirements for an amount of Rs.300,00,00,000/- (Rupees Three Hundred Crores Only) " (of pp 75 of the written synopsis dt 16,11.2016) (x) At page 115, 4.1(e), seller has represented as under: "(e) all information set forth herein and each of the Loan Documents are true and correct in all respects, and all names, addresses, amounts, dates, signatures and other statements and facts contained in the Loan Documents relating to Receivable respectively are genuine, true and correct," (of pp 79 of the written synopsis dt. 16.11.2016) (xii) At page 115-A, 4.1(m), it has been represented as under: "(m) all Transaction Documents, entered into by the Seller have been entered into in the ordinary course of business of the Seller and all costs, charges, fees, expenses incurred in making, claiming and recording of each such Transaction Documents have been paid at the time of execution of such Transaction Documents." This is an admission that the transactions have been made in the ordinary course of business. (xiii) At page 115A it is stated: "(o) The Obligor entered into the Loan Documents to which it is a party of its own free will, and (he terms and conditions contained in each Loan Document(s) correctly reflect the entire agreement between the parties thereto and there are no other oral or written agreements or representations in connection therewith." This is clearly a false statement because the loan agreement has not been executed by that date. (of pp 80 of the written synopsis dt 16.11.2016) “(q) each of the Loan Documents have been duly authorized , executed and delivered by the Obligor who is party thereto, complies with all applicable state, central, local and other laws, rules, GE Capital Services India & Loan Trust (Group cases) 46 Regulations and requirements with respect thereto and represents the legal, valid and binding irrevocable obligation of the Obligor, enforceable under all applicable laws, against the Obligor in accordance with its terms, except to the extent that enforcement of the remedies may be limited by applicable bankruptcy, insolvency or similar laws." This representation has been made in this document when the loan agreement has not been executed. (xv) Further at page 116 it has been stated "(v) there exists only one original of each Loan Documents and the copy of the same is in the possession of the Seller." The loan agreement has not been executed but such an audacious averment has been made. How the Seller has gone to the extent of making such an audacious averment without any fear of consequences and all cautions have been thrown into the winds. This also shows how IL&FS Trust Co. Ltd. has signed on the dotted lines and had been a party to it. The Revenue would ask the question - Can such acts be pardoned? (of pp 81 of the written synopsis dt 16.11.2016) As stated earlier, loan agreement has not been executed so far. The loan agreement has been executed later on the 21 st May 2008. Thus repeated false declarations have been made in various documents. (i) Page 75A-At (A), it is mentioned that the loan agreement was dated 16 th May 2008. At (B), it is stated that "the Settler is desirous of assigning by way of securitization , the amounts receivable under the Loan Agreement (the Receivables) along with all the rights and Security Interest under the Loan Agreement and other deeds, documents and writings relating to the Loan to a trust to be formed hereunder...... All the averments therein are incorrect as there was no subsisting loan agreement. The loan agreement was executed a day later on 21 st May 2008. Yet reference is made to the loan agreement here in the trust deed, (of pp 83 of the written synopsis lit 16.11.2016)" The ITAT is the highest fact finding authority. They ought to have discussed and given a categorical finding on the submissions on the documents instead of brushing them aside as minor defects. In the last Hue of paragraph 6.8.6 the IT AT has referred to them as “marginal defects” without any basis. Again in paragraph 6.8.7 it has been observed ".....money trail cannot be disregarded only due to the marginal defects in the clauses in the documents and also the timing and signing of these documents." It is a non- speaking order which does not discuss the contention of the Revenue; these are grave infirmities striking at the root of the whole transaction. The order of the ITAT has not dealt with how the innumerable inconsistencies pointed out in the oral arguments and written submissions are minor and not material to deciding the issue of genuineness of trust. Any order is expected to demolish an argument and arrive at a conclusion. It is a serious omission GE Capital Services India & Loan Trust (Group cases) 47 on the part of the Hon'ble ITAT from another angle. Anybody who does not have access to the written synopsis would not have an idea of the gravity of the defects graphically described in writing and would be carried away by the above repeated observations of the ITAT that the defects are marginal. 17.1 In paragraph 65 (p.101) of the written synopsis, it has been submitted as under: "CONCLUSION FROM THE ANALYSIS OF THE DOCUMENTS 65. In the foregoing paragraphs, extremely pains taking efforts have been made to establish that the documents furnished and relied on lack integrity. Internal inconsistencies are galore .It is a settled principle of lave that whenever anything is required to be done in a particular manner, it must be done in that manner. The documents alone speak for the action of the assessee and about its claim that it is a valid trust and that it has implemented the scheme of securitization. The whole edifice of the claim of the assessee is built on the edifice of the documents. If the documents are found to lack integrity and are unreliable, the foundation goes and the whole superstructure crumbles. The Ld. Sr. Counsel of the assessee made desperate attempts to save the reliability (of documents by) arguing that there have been some inadvertent omissions here and there. But these are, it is respectfully submitted, to revive a patient who is dead. The inconsistencies and flaws pointed out are extremely serious and absolutely unpardonable. This is a blatant attempt to subvert a system in reckless as well as deliberate manner. They would have escaped attention had they not been caught by fortuitously picking the case for scrutiny. Once they are caught, they cannot be let off lightly accepting some lame excuses. Once one chooses to play with fire, he must be prepared for burnt fingers. " Similarly at paragraph 66 of the synopsis p 103, it has been prayed: "66. It is respectfully submitted that the Hon'ble ITAT is the highest fact finding authority. Examination of the veracity of the documents is in the domain of the Hon'ble ITAT, It is, therefore, submitted that the above factual submissions made with appropriate references may kindly be examined in detail. It is the respectful submission of the Revenue that the documents are unreliable and accordingly there is no valid trust and the assessee has not implemented the RBI Guidelines on Securitization." This prayer of the Revenue has not been addressed. It is, therefore, submitted that the issues raised by Revenue regarding the enormity of the defects in the documents, which have been summarized in the written synopsis may be discussed in a speaking order and a ruling be given as to how they are minor/marginal defects and not relevant to deciding the ground of appeal. . 18. In paragraph 6.8.6, the ITAT has made the following observation: GE Capital Services India & Loan Trust (Group cases) 48 "If the trust does not exist, then what is the legal sanction to treat the trust as AOP? There is the inherent contradiction in the argument urged by the Revenue, which in our considered view is a fatal flaw to the proposition advanced by the Revenue." Cogent reasons have been given by the CIT(A) and in the arguments before the ITAT in support of this conclusion. The grounds of appeal and arguments advanced by Revenue has always been that the assessee is not a Trust and that the status of assessee is an AOP. This observation of ITAT in its order cited under reference, in the relevant extract cited above, needs clarification. 19. Critical Analysis of the Return: Pp 113 to 118 of the written synopsis make critical analysis of the return of income. The conclusion is at page 118 as under: "(xvi) The above critical analysis of the return of income lead to the following clear conclusions on the basis of the admission of the assessee in the return of income: (a) The status of the assessee trust is that of an AOP (b) The entire income of interest shown by the assessee is business income. (c) The assessee has not shown any expenses and the gross receipt has become the net receipt. (d) The total income is actually Rs. 21,49,72,486/- (e) This has been distributed to the beneficiaries after it was earned.” There is no further scope for any relief to the assessee. According to the return of income filled up by the assessee, the entire amount of interest ought to be brought to tax. The Hon'ble ITAT has not given any comment on this submission though this issue was argued extensively. This issue requires clarification by the ITAT. 20. Ground no. II of assessee's appeal has been allowed fully relying on and extensively quoting from the order of the Bangalore Bench of the ITAT in the case of DCIT v, India Advantage Fund VII, ITA No. l78/Bang/2012). It was pointed out by the Revenue that the facts are distinguishable. The judgment is not at all applicable as the case was not concerned with securitization. And further the contributors were no MFs who were expressly prohibited from lending funds. (In that case, lenders were individuals and companies.) Securitization involves implementation of RBI Guidelines which was not the subject matter of consideration in the Bangalore case. The Hon'ble ITAT devoted eight pages of its order in verbatim quoting from the inapplicable judgment of the Bangalore Tribunal. Yet, as mentioned earlier, the ITAT ignored and did not refer to the binding judgment of coordinate bench of ITAT Mumbai in the IGHCC Trust cited supra which is directly on this issue. This may be clarified. GE Capital Services India & Loan Trust (Group cases) 49 21. Ground No.III has been allowed ignoring the binding decision of the coordinate bench of the ITAT, Mumbai in the IGHCC Trust cited supra, which is exactly on the same issue. 22. Nature of Income (Whether Profit and Gains from Business) The crucial issue is whether the interest income is income from other sources or income from business. The Revenue is of the view that it is business income while the assessee contends it as income from other sources. This finding is crucial to determine whether the assessee is AOP or if it is a valid trust and whether section 161(lA) is applicable. The Revenue made detailed arguments and discussed in the written synopsis (pages 118 to 132) to establish that it was business income/adventure in the nature of trade. The Coordinate "D" Bench in its order dated 28 th February 2013 in the case of IGHCC Loan Trust v.CTT-19 (supra) has also given a finding that the nature of income is business income. (Vide, Paragraph 12(v) Page 12 of the written synopsis). The Hon'ble ITAT has not given a ruling on this issue in its order. The Hon'ble ITAT has not adjudicated on the head of income. The ITAT ought to give its ruling on this issue as to whether the interest income is business income or income from other sources. Hence, the matter may be requested to be recalled as this is an issue which goes to the root of the matter. 23. Ground No. IV- The argument of the Revenue is that the nature of income is business income. The Revenue strenuously argued with supporting case laws that the income was income from business being an adventure in the nature of trade. A number of case laws were cited and discussed at the hearing. It was contended by the Revenue that if the income is held to be business income, it follows that the assessee (the unit) is an AOP. The ITAT has not dealt with this argument of the Revenue and has not given a finding whether the income is business income being an adventure in the nature of trade. This finding is the foundation for determining whether entity is: an AOP or not. The ITAT may give a finding on this issue. 23.1. In paragraph 9.6.1, the Hon'ble ITAT made an erroneous observation that - "An AOP is not authorized to do securitization activity." This is apparently based on the sec 8 of RBI Guidelines highlighted by the assessee. But in fairness, the Id. Counsel of the assessee should have referred to the definition clause 5(ix), defining SVP- 'SPY’ means any company, trust or other entity constituted or established for a specific purpose." This has also been mentioned at page 37 of the written synopsis furnished by the Revenue. Hence AOP is not barred in carrying out securitisation. Hence, the above observation of the Hon'ble ITAT may be expunged. Revenue's Appeal 24. The ITAT has not adjudicated on the Ground No. 4 of Revenue's appeal which reads as under: GE Capital Services India & Loan Trust (Group cases) 50 "Without prejudice to the above, on the facts and in the circumstances of the case and in law, even if the trust is held to be valid as claimed by the assessee, whether, still, is the income liable to tax at the maximum marginal rate, in view of section 161(1A) of the IT Act, as the captioned income is evidently business income? " This matter was extensively argued orally during hearings and also discussed in the written synopsis dt. 16.1.20116. The ITAT has not adjudicated on this ground and for this alone the matter may be recalled. 25. I is requested that a miscellaneous application may be filed before the ITAT with a prayer to recall its impugned order and deal with the issues pointed out in this letter. 26. As I had stated earlier, this is a fit case for filing appeal u/s 260 A against the order of the Hon'ble ITAT.” 6. In rejoinder learned Counsel of the assessee has submitted as under:- “INDIAN CORPORATE LOAN SECURITISATION TRUST 2008, SERIES 14 ('RESPONDENT OR TRUST') The following principal questions arose for adjudication before the Hon'ble Tribunal in the appeals scheduled before the Hon'ble Tribunal I. Whether the Respondent is a valid Trust? The Tribunal vide para 6.8.7 (page 22) of its order has held that the Respondent is a valid trust. II. Whether the Respondent can be treated as an AOP? The Tribunal has recorded a finding that since the Trust was a valid trust, the question of the trust being AOP of eight or nine members is an academic exercise. Refer Para 10.5 at Page No. 35 of Tribunal's order. III. Whether the Respondent was a revocable Trust? The Tribunal formed the view that the Respondent was a revocable trust as the contributions made by the beneficiaries were a revocable transfer in terms of section 63 of the Act. The adjudication is at Para 7.6.4 & 7.6.5 at Page No. 28 of its order. IV. Whether income chargeable under as profit and gains from Business or Profession section 161(1A)of the Act? Tribunal held that since they held the Respondent to be valid trust. This ground is infructuous. Refer Para 16.5 at Page No.40 It is submitted that (the issues raised), in the Miscellaneous Application preferred by the Department do not challenge or seek in the alteration in the above findings. Nonetheless, our submissions/rebuttal on the same is as under: GE Capital Services India & Loan Trust (Group cases) 51 Summary of Issues raised by the Department in Miscellaneous Application ('MA) and the same is dealt/considered by the Hon'ble Tribunal in its order: 1. Scale of evasion and a holistic approach [Page No. 2-3, Para No. 7] Tribunal's findings/comments: [Page No. 17,19, 20-21, Para No. 6.6.1, 6.8.2, 6.8.4 6-6.8.7] The same is also dealt in our synopsis at Page No.9-23. 2. Binding Precedent ignored (Page No. 3 -5 & 11, Para No. 8, 23|: Tribunal's findings/comments: [Page No. 13 &I7, Para No.4, 6.6.2, 6.7.1] Our submissions: At the outset, we submit that the Hon'ble Tribunal in Para 4 of its judgment has inter alia stated - "that both the parties had made voluminous submissions (oral & written) on facts of the case, issue involved and legal principles. The same has been entirely perused and carefully considered and reference to those portions, which, in our view is relevant to the issues on hand are being made in order." Accordingly, the allegation of the revenue that the earlier decision of the Hon'ble Tribunal in ITA No.3247/M/2012 is a binding precedent and has been ignored is wrong. It is submitted that the said decision deals with the issue of validity of the exercise of the jurisdiction of the Commissioner under section 263 of the Act and is not a decision on the merits of the case. This has specifically been noted by the Tribunal in its decisions at Page No. 16-17 Para No. 5.6 of its order (original ITA No.3247/M/2012 Tribunal's order). The CIT(A) has also at Pages 9-11 of his order noted that 'in view of the decision of the ITAT in the proceedings various issues are required to be examined'. Therefore, it is clear that the Tribunal in ITA No.3247/M/2012 has not decided the issue on the merits of the case. The Hon'ble Tribunal has noted/the reliance on the decision of the IGHCC Loan Trust v. CIT [IT Appeal No. 3274/Mum/2012] by the Department and the counter argument made by the Assessee and the same can be seen from Para No.6.6.2, 6.7.1 of the impugned order]. Further, the Appeals arising from the order passed u/s. 143(3) rws 263 of the Act were also part of the consolidated order passed by the Tribunal dated 22.02.2017. The Department appeal in case of ITO Vs. IGHCC Loan Trust (ITA No.5512/Mum/2014) was also disposed by the I TAT. The sole ground raised by the Department was that the CIT(A) erred in allowing deduction of a sum without appreciating that said sum represented distribution and application of accrued interest income and not expenditure incurred for earning interest income. Thus, the Department itself has not taken any ground that the CIT(A) erred in not following the order of the ITAT rendered in the context of section 263 and that the same is binding on merits. For ready reference Department ground before the Tribunal against the order of CIT(A) is attached herewith as Annexure I and II. [Page No.7- 87] GE Capital Services India & Loan Trust (Group cases) 52 Prayer: In view of the finding of the Tribunal in Para 4 of its judgment and noting the said decision in Para 6.6.2 & 6.7.1 of its order, in our view the Hon'ble Tribunal has considered the binding precedent but since the said decision is not on merits, the Hon'ble Tribunal has not made reference while adjudicating the merits. 3. Subsequent Amendments [Page No. 3-5, Para no. 9| Our submissions: In para 7.6.5 of its decision, the Hon'ble Tribunal has treated the trust as a revocable trust and therefore, the Hon'ble Tribunal gave a finding that the income shall be taxed in the hands of beneficiaries i.e. the Mutual Fund. Now, since the Hon'ble Tribunal has given a finding that the income is not taxable in the hands of the trust, the provisions for taxability in view of subsequent amendment shall not arise. 4. Revised Guidelines of RBI [Page No.5, Para No. 10] Tribunal's finding/comment [Page no.21, ParaNo.6.8.4 -6.8.5] Our submissions: In Para 6.8.4. (page 21) the Tribunal notes that 'RBI Guidelines itself contemplate securitization process to be carried out by originator. Therefore no adverse inference can be drawn on point strenuously put forth by Revenue that originator was guiding force of securitization process.' In Para 6.8.5 (page 21) Tribunal gives a finding that violation of SEBI/RBI guidelines are not of any significance before us and does not affect the validity of the Trust. RBI guidelines are referred in Para 8.5.2 (page 31) 5. Deals with correction of title to ITO 19(3)(2) from ITO 9(3)(2): Our submissions: It is a typographical error. 6. Wrong averment about the loan agreement [Page No.6, Para No. 12] Tribunal's finding/comment [Page no.7 & 2J, Para No.2.1.3 & 6.8.4] Our submissions: The statement reproduced in the MA is just part of the fact. In fact when Para 2.1.3 (page 8) is read in entirety, it appears that Tribunal is referring to unsecured term loan agreement dated May 21, 2008 making the agreement effective from May 16, 2008 (Refer Page 91 of Department Paper Book Volume II (DPB-IP) 7. Information memorandum dated 20.05.2008 was jointly issued... allegation that when information memorandum was issue trust was not in existence [Page No.6, Para No.l4] GE Capital Services India & Loan Trust (Group cases) 53 Tribunal's finding/comment [Page no. 8-9, Para No.2.I.4& 2.1.5(vii)] Our submissions: The Trust was settled on May 20, 2008. This date is not in dispute. Refer Para 5 of AO's order (pageNo.2). Trust deed dated May 20,2008 (PageNo.74 of DPB-1I) 8. Seeks clarification on agreement of intent for the loan and 'agreement for loan' [Page No.6-7, Para 12,15] Tribunal's finding/comment [page No.8-9, Para No.2.1.3 2.1.5] Our submissions: Tribunal in para 6.8.4 (page 21) has stated that "The insistence of Revenue that only the standard format agreement has to be reckoned and not the agreement dated 15.05.2008 does, not appear to be tenable. Even assuming that the agreement dated 15.05.2008 was only in the nature of a letter of intent, it cannot be disputed that the lender, Yes Bank had full knowledge of the loan and had disbursed the amount. " Thus, from the above para it would be apparent that the Tribunal had considered the letter of intent as the loan agreement. 9. Fatal inconsistencies of documents [Page No.7, Para No.16] Tribunal's finding/comment [Page No.19, Para No.6.8.1-6.8.2] Our submissions: There is no factual inconsistency (Refer Page No.111A of Departmental Paper Book- Vol 2): 10. Exchange of Written submissions (Page No.7-8, Para No.17] Tribunal's finding/comment [Page No.l9,Para No.6.8.1-6.8.2] Our submissions: Tribunal in this para refers to written submissions filed by the Department dated July 07, 2014 and July 17, 2014 and synopsis filed by the assessee dated November 17, 2014 11. HPCL repays loan to Yes Bank 'in capacity of service provider' to be recorded [(page No.8, ParaNo.18] Tribunal's finding/comment [Page No.19, Para No.2.1.5 - 6.8.4] Our Submissions; GE Capital Services India & Loan Trust (Group cases) 54 Factually not a correct statement, (to be elaborated in hearing - Referring Para 6.8.4 & 6.8.6) (page 21) 12. Commenting on observation of minor infirmities in documents. - veracity of documents to be discussed in speaking order [Page No.8-9, Para No.19] Tribunal's finding/comment [Page No. 8-9, ParaNo.2.1.5 & 6.8.4] Our submissions: Hon'ble Tribunal in Para 6.8.4 (page 21) has categorically gave a finding that legal document has to be viewed in its entirety and minor defects in documents cannot itself negate the existence of the documents. Further, in Para 6.8.6 (page 21-22), held that 'the documents, though they may be having marginal mistakes, have to be accepted in order to give a legal framework for flow of funds.' Thereupon in Para 6.8.7 (page 22) Hon'ble Tribunal gave a finding that trust is a valid trust. 13. Clarification is sought on Tribunal's observation/comment on if Trust does not exist, legal sanction to treat is an AOP [Page No.9-10, Para No.20] Tribunal's finding/comment (Page No.22-23, ParaNo.6.8.6] Our submissions: In fact the Tribunal in the said para has clarified that if Revenue argument is accepted then only transaction subsisting will be loan between HPCL and Yes Bank and therefore, assessing of AOP does not arise. 14. Critical Analysis of the Return [Page No. 10-11, Para No. 22] Tribunal's finding/comment [Page No.34-35, ParaNo.10-10.5] Our submissions: Tribunal has already commented on the validity of Trust and therefore, this argument becomes academic. 15. Bangalore Tribunal decision of India Advantage Fund is not applicable to Ground II of Assessee's Appeal [Page No.10- 11, Para No.22] Tribunal's finding/comment [Page No.23, Para No.7.6.1] Our submissions: In fact the Tribunal is conscious of the argument of the Revenue and has categorically held that 'Even though facts of the cited case does not pertain to GE Capital Services India & Loan Trust (Group cases) 55 securitization, pointed out by Revenue, the principles enunciated in that decision are universally applicable and certainly to the case on hand,... ' Thereafter, the Tribunal has produced the extracts of decision and summarised the principles laid down in the said decision. In Para 7.6.5 (page 28) it is held that the assessee Trust is revocable trust and contribution by beneficiaries is a revocable transfer. 16. Ground III of Assessee's Appeal is allowed ignoring binding precedent of IGHCC Tribunal's finding/comment [Page No.18, Para No.6.7.1] Our submissions: To be dealt with Issue 2 of the MA. Further in Assessee's rebuttal at Para No. 6.7.1 it was pointed out that the said decision does not deal with the merits of the case. 17. Nature of Income- whether profit and gains from business or profession [Page No.II, Para No.24] Tribunal's finding/comment [Page No.37-38, Para No. 16.1] Our submissions: In fact in Ground 4, the Revenue had categorically raised a specific ground stating that the findings of the CIT(A) to which the Tribunal has held in Para 16.5 (page 40) that since it has decided the issue in favour of the Assessee, the Revenue's ground are dismissed as once the contributions have to be assessed in the hands of the contributors under section 61, the chargeability of the income in the hands of the Trust becomes academic. 18. Erroneous observation ‘an AOP is not authorized to do securitization activity [Page No.11-12, ParaNo.25] Tribunal's finding/comment (Page No.33, Para No.9.6.11 Our submissions: In fact in our synopsis at Page 2, Para II, the RBI guidelines and the definition of SPV are referred and considered. Also Refer Para 5.1 (in) (page 14) of the Tribunal's decision and see synopsis dated November 17, 2014 19. Ground No. 4 of revenue's appeal not adjudicated [Page No.12, Para No. 26] Tribunal's finding/comment [Page No.37-38, ParaNo.16.1] GE Capital Services India & Loan Trust (Group cases) 56 Our submissions: In Ground IV, Revenue had categorically raised a ground clarifying on that the income of the Trust ought to be taxed u/s, 161 (I A) of the Act at maximum marginal rate. The Tribunal in Para 16.5 (page 40) has held that as assessee ground inter alia of it being a revocable trust is decided in favour of assessee, the Revenue's ground would not survive for consideration. The Assessee submits that as there is no income which is chargeable to tax in the hands of the Trust, the question of going into section 161(1A)of the Act does not arise.” Second Category : 7. Since the Miscellaneous Applications in this category are identical, we are referring to Miscellaneous Application in M.A. No. 430/Mum/2017. The Miscellaneous Application is preferred as under : Re : I.T.A. No. 4781/Mum/2014 & ITA No. 1784/Mum/2014 in the case of PFL Loan Trust. “Issues raised in the Miscellaneous application under Section 254(2) of the Act Most Respectfully Sheweth: 1. The Applicant submits that the noting below the list of appeals in the order which records representation as follows, "Revenue by : Smt. S. Pandya" is erroneous. 2. The above error is a mistake apparent from record. The name of the CIT DR for F Bench, ITAT who represented the matter is S. Padmaja. The Special Counsel, Shri P.C. Chhotaray was authorised to represent the Department in ITA Nos. 5758/M/14 and 5513/M/14. 3. The Applicant submits that in the top line of the list of appeals, the Assessment Year is wrongly written as 2007-09 instead of 2007-08 which may be corrected. 4. The Applicant submits that in para 2 of the order dated 22.02.2017 it is noted that "... after considering the facts and legal issues involved in these appeals, they are found to be similar/identical to those that have been duly considered in the group of secularization cases of IL&FS Trust Co. Ltd...." 5. The Applicant submits that, similar and identical have different dictionary meanings and the order of Hon'ble ITAT ought to have clarified which cases were similar and which were identical. It is humbly submitted that the Hon'ble ITAT has not given a reference to such facts and legal issues. 6. The Applicant submits that in para 2 of the order dated 22.02.2017 it is stated that, "... on appeals filed by the assessee, the Ld. CIT(A) concerned GE Capital Services India & Loan Trust (Group cases) 57 have rendered findings that, after considering the facts and legal issues involved in these appeals, they are found to be similar/identical to those that have been duly considered in the group of Securitisation cases of IL&FS Co. Ltd ...." 7. The Applicant submits that the various CIT(A)s, by following the decision of the CIT(A) in the case of Indian Corporate Loan Securitization Trust 2008 Series-14 have recorded that issues involved in Grounds of Appeal were duly considered and that there are no change of facts during the said year; and the decision in the case followed would be applicable to the facts of the Appellant's case in the current year. It is submitted that the Hon'ble ITAT is the final fact finding authority and there were several facts which were brought out by the Special Counsel in the extensive arguments during the hearing of the case of the Indian Corporate Loan Securitization Trust, 2008, Series -14, AY 2009-10 including serious defects in the various documents furnished by the assessee. The Special Counsel also furnished a voluminous written synopsis of arguments running into 243 pages. Such facts of each case would have a material bearing on the outcome of the decision. The Hon'ble ITAT erred in not examining these differences or taking into account these differences as pointed out by the Special Counsel. The Hon'ble ITAT erred in not bringing the same on record and merely referring to these as being identical/similar. 8. The Applicant submits that in para 3, the order of the Hon'ble ITAT dated 22.02.2017 reads as follows, ".... The Ld. CIT (DR) for Revenue, after due verification agreed that the issues raised in the grounds of appeal in these appeals are identical to those raised in the lead matter...." 9. The Applicant submits that a chart was prepared by the Assessing Officers of the various Trust cases wherein it was categorically stated that the grounds of appeal are similar and not identical grounds to those raised in the lead matter. 10. The Applicant submits that para 6.1 of the order mentions that both parties have agreed that grounds of appeal are similar/identical to the grounds raised in the lead matter. It is humbly submitted that there was no such agreement by the CIT(DR) and in fact a request was made to hear all cases separately, a few at a time and the CIT(DR) also ensured all cooperation to complete representation of all cases within four weeks. 11. The Applicant submits that the CIT (DR) informed the Hon'ble Bench that the 278 Trust matters, other than the five matters assigned to the Special Counsel were to be represented by the CIT(DR), ‘F’ Bench. The CIT(DR) requested for hearing the cases separately; the same was not acceded to and arguments by Revenue were permitted for two hours on a forenoon. None of the arguments made orally have been referred to in the order of the Hon'ble ITAT. 12. The Applicant humbly submits that the Tribunal is the final fact finding authority and the absence of any reference/rebuttal of these oral arguments in the order of the Hon'ble ITAT renders it erroneous. GE Capital Services India & Loan Trust (Group cases) 58 13. The Applicant submits that in para 6.1 of the order of the Hon'ble ITAT dated 22.02.2017, it is mentioned that, "following the decision of this Bench of the Tribunal in the case of Indian Corporate Loan Securitisation Trust 2008 Series 14 in ITA No. 3986 & 4343/Mum/2013 dated 17.02.2017 (a copy of which will form part of this order),...." 14. The Applicant submits that no order was part of this order dated 22.02.2017. Para 6.1 of the order of the Hon'ble ITAT dated 22.02.2017 refers to reliance on order in the lead matter in ITAs no 3986 & 4343/Mum/2013 for AY 09-10 and states that the findings should be applied uniformly to all the 248 appeals in these cases. Thus, this order of the ITAT dt. 22.02.2017 which relies on another order, which is not appended (though stated to be) renders the entire order erroneous. 14.1 Further, the impugned order derives its essence from the orders in the cases of Indian Corporate Loan Securitization Trust 2008 Series 14 (The lead case, referred as ICLST hereafter). This is humbly pointed out that the order in the case of ICLST in itself suffered from a grave infirmity as a binding precedent of the coordinate bench in the case of IGHCC Loan Trust was not followed despite the facts and circumstances being identical. Judicial discipline warranted that either the coordinate bench's decision be followed, or cogent reasons be deliberated and assigned in the order for not following the same. In this view, as the original order itself suffers from material deficiencies and apparent mistake (Miscellaneous Applications against the said orders are also being filed concurrently), the same error stands extended to the impugned order too. The petitioner humbly beseeches your indulgence to correct this apparent mistake. 15. The Applicant particularly refers to two cross appeals out of the group of appeals disposed of in this common order, namely, ITA Nos. 5758/M/14 and 5513/M/14, where the concerned trust was IRE Loan Trust. These two appeals were assigned to the Special Counsel for the reasons as follows. In these appeals M/s. GE Capital Services India was the Originator. M/s GE Capital Services India had filed an intervention application for permitting it to be an intervener in the hearing of the loan trust cases. It contended that the CIT(A) had erred in including it as a member of the Association of Persons (AOP) when the Assessing Officer had not included it in the AOP. It argued that any decision of the Hon'ble ITAT in loan trust appeals would have impact on its interest. Hence, it wanted to be heard in the matter as an intervener. 16. The intervention application was rejected by the Hon'ble ITAT. On a writ filed by M/s GE Capital Services India, the Hon'ble Bombay High Court, while not adjudicating on its right of intervention, permitted it to file appeals against the order of the CIT(A) and directed the Hon'ble ITAT to consider the appeals. In pursuance of the order of the Hon'ble High Court, M/s GE Capital Services India filed 33 appeals before the Hon'ble ITAT. One of these 33 appeals, namely, GE Capital Services India v. Income Tax Officer 23(1)(2), ITA No. 1080/Mum/ 2016, was assigned to the Special Counsel Shri P.C. Chottray. He argued the appeal and also gave a written synopsis of the arguments. GE Capital Services India & Loan Trust (Group cases) 59 7. Because of this background, Shri P C Chhotaray was assigned the captioned loan trust cross appeals, namely ITA Nos. 5758/M/14 and 5513/M/14 corresponding to the appeal of GE Capital Services India, ITA No. 1080/Mum/2016 referred to above. However, the Hon'ble ITAT did not give any hearing on these two appeals. As mentioned above, the Hon'ble ITAT dismissed all the other appeals following its order in the case of Indian Corporate Loan Securitization Trust, 2008, Series -14. 18. The Special Counsel orally requested that each individual appeal should be separately heard on factual issues. However, since, the Hon'ble ITAT did not fix any hearing on these two cross appeals, the Special Counsel submitted a written submission dated 13.12.2016 to point out the distinguishing facts of this case from this case of Indian Corporate Loan Securitization Trust, 2008, Series 14. However, the office of the Hon'ble ITAT, after consulting the Hon'ble Member refused to accept it. This is a clear case of denial of natural justice. On that account alone the order is void. 19. A copy of the said written submission dated 13.12.2016 is enclosed. The applicant submits that the said two cross appeals should be reheard. 20. In view of the above mentioned errors and omissions in the order of the Hon'ble ITAT, the Applicant prays that the Hon'ble Appellate Tribunal may be pleased to; a. Set aside the order dated 22.02.2017 passed in the Appeal No. ITA Nos. 4781 & 4784/ Mum/2014 as per the provisions of Sec. 254(2) of the Act. b. Such other and further relief which the Hon'ble Bench deems fit.” 8. Further in rejoinder to Miscellaneous Application No. 430 to 689/Mum/2017 except M.A. No. 477/Mum/2019 arising out of ITA No. 3986/Mum/2013 & ITA No. 4343/Mum/2013, learned Counsel of the assessee has made following rejoinder : “Summary of Issues raised by the Department in Miscellaneous Application ('MA') and issues dealt by the Hon'ble Tribunal in its order: 1&2. Representation of Revenue of recording S. Pandya is erroneous: (Page 1 of Tribunal's order) Respondent's Submissions; Its clerical typing error and should have been recorded as S. Padmaja. 3. Assessment Year is wrongly written as 2007-09 instead of 2007-08 which may be corrected: [First item in Table opposite to IRE Loan Trust] GE Capital Services India & Loan Trust (Group cases) 60 Respondent's submissions: It is clerical typing error, (but in some assessment year's it is AY 2009-10, AY 2010-11. Therefore, the submissions of the department in such MA's are not correct) 4. In Para 2 of the order dated 22.02.2017 it is noted "after considering the facts and legal issues involved in these appeals, they are found to be similar/identical to those that have been duly considered in the group of securitisation cases of IL& FS Trust Co. Ltd." 5. Similar and identical have different dictionary meaning and order of Hon'ble ITAT ought to have clarified which were similar and which were identical. Respondent's Submissions: Hon'ble Tribunal in Para 3 of its order renders finding on the above Para 4 & 5 by inter alia noting that both the Senior Counsel of the Assessee and learned CIT-DR for Revenue, after due verification have agreed that the issues raised in the grounds of appeal in these appeals are identical to those raised in the lead matter, i.e. the cross appeals in the case of Indian Corporate Loan Securitization Trust - 2008 Series -14 and, therefore, the findings rendered by the Coordinate Bench on the various issues in the cross appeals in the lead case would be applicable to all these appeals. It is further submitted that there is no distinction between similar/identical. 6 &7. Hon'ble Tribunal notes that facts and legal issues involved in appeals are found to be similar/identical... Hon'ble Tribunal is final fact finding authority and several facts were brought out by Special Counsel in extensive arguments during hearing of Indian Corporate Loan Securitization Trust- 2008 Series-14 including serious defects in documents with synopsis or arguments in 243 pages. Facts of each case would have material bearing on outcome of decision. Hon'ble ITAT has not examined these differences and erred in not bringing the same on record and merely referring to these as binding or similar. Respondent's Submissions: Contentions of the Revenue in Para 1 and 2 is contradictory to contentions raised in 6 & 7 as the Counsel for Department was Padmaja in aforesaid MA's and she has not referred to voluminous submissions and the same was filed by Special Counsel in lead matter. Further, in Para 6.1 of its order, the Hon'ble Tribunal notes as under: "....In these factual and legal circumstances, not only the learned CIT(A)s in all these cases, but also the learned counsel's for both parties are agreed that the issues involved in these appeals across assessment years are similar and have been duly considered in the group cases of the IL&FS Trust Co. Ltd., of which group the lead matter is Indian Corporate Loan Secutritization Trust - 2008, Series 14 in IT A Nos. 3986 & 4343/Mum/20J3for A. Y. 2009-10. " (Underlined for Emphasis) GE Capital Services India & Loan Trust (Group cases) 61 Further, Department has alleged that the facts of these bunch of appeals are different from the lead matter. If that being the case, reference of their drawing to the decision to Indian Corporate Loan Securitisation Trust-2008 Series 14 (See point no. 14-14.1 of MA) goes contrary to their stand that issues in appeals are different. In fact, that itself shows that the issues are similar. 9. Chart was prepared by AO of various Trusts stating that Grounds of appeals are similar and not identical to those in lead matter Respondent's Submissions: There is a categoric findings in the order of the CIT(A) that the issues involved in the captioned appeals are identical to the lead matter i.e. Indian Corporate Loan Securitization Trust - 2008, Series 14 (Refer Para 4.2 of CIT(A) order in PFL Loan Trust). Department has not challenged this finding before the Tribunal in its grounds before ITAT. 10. In Para 6.1 of the order mentions both parties have agreed that grounds of appeals are similar/identical to grounds raised in lead matter. There was no such agreement by CIT-DR and in fact made request to hear all cases separately. Respondent's Submissions: Refer Para 3 and Para 6.1 of the Tribunal's order where there is a categoric finding that both parties have agreed that the issues arc similar/identical. In fact, the CIT(A)in his order at Para 4,2 and Para 5 of their order that appeals are identical. In fact, Hon'ble Tribunal in Para 6.1 has noted that not only the CIT(A) but also counsel's for both sides has agreed that issues are similar. 11. CIT - DR requested for hearing cases separately and the same was not acceded to. None of the arguments made orally have been referred to in order of Hon'ble ITAT. Respondent's submissions: Refer Para 3 & 6.1 of Tribunal's order wherein it is recorded that both parties have agreed issues are similar and findings of lead matter shall apply and in view of such findings, whether the said point/issue raised seems contradictory. Refer decision of the Hon'ble Court in case of Seth Champalal Ramswarup v. CIT [(1964) 52 ITR 201] has made an observation that if a point does not find mention in the Tribunal's judgment the presumption is that it was not argued before the Tribunal. 12. Tribunal is final fact finding authority and absence of reference/rebuttal of these oral arguments in order of Hon'ble ITAT renders its erroneous. Respondent's submissions: 13. In Para 6.1 of its order dated 22.02.2017 Indian Corporate Loan Securitization Trust - 2008, Series 14 in ITA Nos. 3986 & 4343/Mum/2013 for A.Y. 2009-10 (copy of which will form part of this order) GE Capital Services India & Loan Trust (Group cases) 62 14. Applicant submits no order was part of this order. Thus, the order which relies on another order which is not appended (though staled to be) renders entire order erroneous. Respondent's Submissions: Non- appending the order cannot render the entire order erroneous. The lead matter order was always available with the Department. In any event not appending order cannot give rise to mistake apparent on record. 14.1 In case of Indian Corporate Loan Securitisation Trust - 2008 - Series 14 itself suffered from grave infirmity as binding precedent of IGHCC loan Trust was not followed. Respondent's submissions: Department earlier in its MA has pointed out that the facts of these bunch of appeals arc different. If that being the case, reference of their drawing to the decision to Indian Corporate Loan Securitisation Trust - 2008 - Series 14 goes contrary to their stand that issues in appeals are different. In fact, that itself shows that the issues are similar. Without Prejudice, the Department could have challenged the consolidation petition at earlier stage, if the issues are different. Without Prejudice as regards to binding precedent, we rely on our submission in the lead matter. 15-18. Pertains to GE Capital Services India: Respondent's Submissions: The said fact does not alter the finding or adjudication. 19. Copy of written submissions dated 13.12.2016 is enclosed with Miscellaneous Application which is filed against lead case. i.e. IRE Loan Trust ITA No.5513/M/2014 & 5758/M/20I4 dated 22.02.2017. The Applicant submits that said 2 appeals be reheard. Respondent's Submissions: We submit that if the findings of lead matter are upheld this becomes academic. Third Category : 9. These are Miscellaneous Applications arising out of order of GE Capital Services India. Since the Miscellaneous Applications are of same category, we are referring to M.A. No. 471/Mum/2017 directed against the ITA No. 5513/Mum/2014 vide order dated 22.2.2017 in the case of IRE Loan Trust. GE Capital Services India & Loan Trust (Group cases) 63 10. Submission of learned Departmental Representative in this case read as under:- 1. The applicant submits that the captioned order of the Hon'ble ITAT is a composite order for 33 appeals. It is shown in the order that the Special Counsel Shri P C Chhotaray represented all the 33 appeals on behalf of the Revenue. The Special Counsel represented only one appeal - ITA. No. 1080/Mum/2016 for which hearing took place. The CIT (DR) Smt. S. Padmaja was authorized to represent the other 32 appeals; she was however not given an opportunity to represent the said cases. It is humbly submitted that this being an error of fact, the necessary correction may kindly be made in the order. 2. The applicant submits that in paragraph 5 of the captioned order of the Hon'ble ITAT, it has been stated that the Tribunal has passed an order in the cross appeals in the case of Indian Corporate Loan Securitization Trust 2008, Series 14 for A.Y. 2009-10 in ITA Nos.2986 (3986) & 4343/ Mum/2013 dated 17.02.2017 a copy of which will form part of this order. But a copy of the said order has not been attached to the captioned order. The order is erroneous as the order on which it relied and was stated to have been enclosed and have formed part of this order has not been enclosed. Separate MAs are being filed against the order on which the impugned order relies, that is, ITA Nos. 3986/M/13 and 4343/M/13. It is humbly prayed that these MAs be disposed together to ensure cogency. 2.1 Further, the impugned order derives its essence from the orders in the cases of Indian Corporate Loan Securitization Trust 2008 Series 14 (the lead case, referred as ICLST hereafter), and IRE Loan Trust &L Ors. This is humbly pointed out that the order in the case of ICLST in itself suffered from a grave infirmity as a binding precedent of the coordinate bench in the case of IGHCC Loan Trust was not followed despite the facts and circumstances being identical. Judicial discipline warranted that either the coordinate bench's decision be followed, or cogent reasons be deliberated and assigned in the order for not following the same. In this view, as the original order itself suffers from material deficiencies and apparent mistake (Miscellaneous Applications against the said orders are also being filed concurrently), the same error stands extended to the impugned order too. The petitioner humbly beseeches your indulgence to correct this apparent mistake. 3. The applicant submits that in paragraph 5, it has been further stated as under: "In this regard, both the parties, in hearings before us, after verification, agreed that, as held by the learned CIT(A)s, identical issues are raised in the other 248 appeals, which includes the appeals of IRE loan Trust (ITA No. 5758/Mum/2014 and ITA No.5513/Mum/2014) and other 32 cases listed above where GECSI was 'Originator' in those loan securitization transactions. In that view of the matter, we have held in those 248 appeals in the case of IRE Loan Trust in order in ITA Nos. 5513 & 5758/Mum/2014 and others GE Capital Services India & Loan Trust (Group cases) 64 of even date that our findings rendered in the case of Indian Corporate Loan Securitization Trust, 2008, series 14 in ITA Nos. 3986 & 4343/ Mum/2013 dated 17.02.2017 would apply mutatis mutandis to all those appeals of both the assessee and the Revenue." 4. In this connection the applicant submits that, as reported by the Special Counsel, the Special Counsel did not agree that identical issues are raised in all the appeals. He categorically stated that each case should be examined separately to find out individual differences. It is pertinent to mention that the CIT DR, authorized to argue the other cases was not given opportunity to be heard. The order of the Hon'ble ITAT may be corrected accordingly. 5. The applicant submits that the Special Counsel was authorized to represent this particular appeal bearing ITA No.l080/Mum/2016. At the end of the hearing, the Special Counsel submitted a written submission (Departmental Paper Book (DPB) running into 23 pages) dated 29.11.2016. A copy of this submission is enclosed for ready reference. The Special Counsel did not concede that the case was identical to the case of Indian Corporate Loan Securitization Trust 2008, Series 14 in ITA Nos.3986 &. 4343/ Mum/ 2013. He distinguished the case and argued that on merits, M/s GE Capital Services India ("GECSI") was deeply involved in the entire process and has been justifiably included in the AOP. The relevant extracts of the written submission are separately placed in an Annexure to highlight the issue. 6. It is significant to note that the intervener itself is stating that its case is different from the case of Indian Corporate Loan Securitization Trust Series 14. The following extract from the written submission of the Department (Departmental Paper Book) containing the relevant submission of the intervener would prove this point. Please refer pp 5 which is as under: "(vii) Even at the micro-level, the case of GECSI could not be compared with Yes Bank Ltd. who was the originator in the case of Indian Corporate Loan Securitization Trust 2008 Series 14. There, Yes Bank Ltd. performed several other functions like issuing information memorandum, being service provider, receiving balance amount after all the beneficiaries were paid off; the connection of GECSI with the trust and the investors was much more remote than that of Yes Bank Ltd. with the corresponding trustee and investors. Therefore, GECSI should not be judged by the same yardstick as that used for Yes Bank Ltd." 7. It is humbly submitted that even though the intervener itself is saying that its case is not identical with the case of Indian Corporate Loan Securitization Trust 2008 Series 14, the Hon'ble ITAT has stated in the impugned order that the cases are identical. 8. The applicant humbly submits that the impugned order of the Hon'ble ITAT, allowing the appeal of the intervener, has been passed without considering/rebutting the arguments and the written submission of Revenue. GE Capital Services India & Loan Trust (Group cases) 65 9. It is humbly submitted that the Hon'ble ITAT ought to have dealt with the arguments and written submission of the Revenue. Non-consideration of the submissions of the Revenue vitiates the order of the Hon'ble ITAT and renders the said order erroneous. 10. The Applicant humbly submits that only one appeal, i.e ITA. No. 1080/M/2016 was actually heard by the Hon'ble ITAT and written submission was furnished. The oral arguments and written submission in this appeal were not considered. The Hon'ble ITAT allowed the appeal of intervener, GE Capital Services India, following its order in the case of Indian Corporate Loan Securitization Trust, 2008- Series - 14. This is the case with the other 32 appeals in this impugned order which were not heard at all. 11. The Applicant humbly submits that only one substantive order has been passed in the case of Indian Corporate Loan Securitization Trust 2008, Series -14. On the basis of that single order, 282 other appeals have been disposed without examining the appeals for factual differences. 12. In view of the above mentioned errors and omissions in the order of the Hon'ble ITAT, the Applicant prays that the Hon'ble Appellate Tribunal may be pleased to ; a. Set aside the order dated 22.02.2017 passed in the Appeal No. ITA No. 1080/2016 & Others as per the provisions of Sec. 254(2) of the Act. b. Such other and further relief which the Hon'ble Bench deems fit.” 11. Rest of the submission relates to merits of the case as Annexure. We are not reproducing the same as merits are outside the purview of provisions of the section of 254(2) of the Act. Our Adjudication : 12. We have carefully considered the submissions and perused the records. In the first and second categories of Miscellaneous Applications, Senior Counsel Shri Percy Pardiwala has argued on behalf of the assessee and in the third category of Miscellaneous Applications senior counsel Ms. Fereshthe Sethne has argued on behalf of the assessee. Shri Pardiwala has summarized his submissions which are already noted hereinabove. Ms. Shethe also submitted that there is no mistake apparent from the order of the ITAT and the Revenue actually seeks review of the matter not permissible under the Act. GE Capital Services India & Loan Trust (Group cases) 66 Since Miscellaneous Applications have common thread we are adjudicating the same hereunder. 13. We note that the first challenge by the Revenue is that binding precedent has not been followed by the ITAT. In this regard we note that the ITAT has duly referred that both the parties had made voluminous submissions on facts of the case on issue involved and legal principles. That the same has been entirely perused and carefully considered and reference to those portions, which in Tribunal’s view is relevant to the issues on hand are being made in the order. 14. Thus it is evident that the ITAT has duly considered all the submissions including the case laws. What the ITAT has not found relevant has been clearly stated that the same is not being referred in the order. Now the revenue in this Miscellaneous Application seeks to reiterate that the cases referred are relevant and they were binding. When ITAT has clearly held that they have found the same to be not relevant by no stretch of imagination the same falls under the realm of rectification of mistake apparent from record. The ITAT now cannot review its order and give a finding as to how these case laws which have been found by the ITAT earlier to be not relevant now become relevant in view of the submissions of the assessee in the Miscellaneous Application proceedings. Hence, in our considered opinion this aspect of challenge by the revenue is not sustainable and the same is rejected. 15. The revenue further contended as to how the case laws and various submissions before the ITAT were relevant. That various issues like subsequent amendment, mischief rules etc. were discussed. Hence, now the revenue submits that the ITAT may give its finding on these issues. We note that as already noted above the ITAT has passed an order where it has been clearly mentioned that they have considered all the relevant matters and they are referring to only those issues which are relevant for the order. Now revenue’s grievance is that the ITAT should make an elaborate order and give GE Capital Services India & Loan Trust (Group cases) 67 detailed finding therein. In our considered opinion this cannot be construed as rectification of mistake apparent from record. It is clearly a pursuit of review of the order not permissible under the Act. 16. It has further submitted that revenue had pointed various defects in the documents and the same have been glossed over lightly. Even for argument sake if is accepted that the ITAT has considered the submissions lightly it can be an error in judgment. It cannot be termed to be mistake apparent from record liable for rectification under section 254(2) of the Act. The revenue has reiterated that ITAT is highest fact finding authority. That ITAT ought to have discussed and given a categorical finding. In other words, the plea of the revenue is that the ITAT should have passed a more detailed order. A request for a detailed order can by no stretch of imagination be considered to be a rectification of mistake apparent from record. 17. The revenue further find fault in certain decisions relied upon by the ITAT claiming that the same are not applicable. Our fresh consideration of this aspect can only be termed to be a review of the order of ITAT not sustainable in law. 18. Further it is the contention of the revenue that the ITAT has not determined the nature of income. In this regard we note that the revenue has raised ground No. (iv) in this regard. The ITAT has held that since it has decided the issue in favour of the assessee revenue’s grounds are dismissed. As once the receipt have to be assessed in the hands of the contributors under section 61 the chargeability of the income in the hands of the Trust becomes academic. Thus it is evident that after being fully conscious of the ground and the facts TAT has taken a conscious decision and the revenue in the present Miscellaneous Application is seeking a review of the said order. 19. Another submission of the revenue is that in the second category of orders ITAT has mentioned that it is following its earlier order in another case and the same is appended to the said order which has in fact not been GE Capital Services India & Loan Trust (Group cases) 68 appended. We find that this is quite a frivolous plea. The order in the lead matter was always available to the revenue. 20. We note that in rejoinder learned Counsel of the assessee has pointed out how various aspects of the ITAT order which have been mentioned in Miscellaneous Application for having infirmities and inconsistencies are not actually correct. We note that we are conscious that we are dealing into a Miscellaneous Application for rectification of mistake apparent from record. The inconsistencies and infirmities pointed out by the revenue in the ITAT order in our considered opinion are not at all mistakes apparent from record. Hence, these cannot be a subject matter of our order u/s. 254(2) of the Act in this case. 21. Another grievance of the revenue is that it was requested that ITAT should pass separate orders individually and ITAT has erred in observing that issues have been found to be similar/identical. It has been submitted that similar and identical have different dictionary meanings and that ITAT should have clarified which were similar and which were identical. It is further mentioned that ITAT is wrong in mentioning that CIT-DR has agreed that the issues were similar/identical. 22. In this regard we note that ITAT had categorically held and observed that CIT-DR had agreed that the issues are similar. It is also not the case that any objection was raised when the appeals were consolidated. Hence, the revenue’s submission that this is wrong observation by the ITAT is not borne out of records and hence non-sustainable. Moreover if the issues have been found to be similar and identical in the judgement of the ITAT another Coordinate Bench of the ITAT cannot review the said judgement in a Miscellaneous Application under section 254(2) of the Act. 23. In fact the fallacy of such a statement is not lost upon us by the obvious fact that even in the MAs Shri Chottray has made the entire arguments based GE Capital Services India & Loan Trust (Group cases) 69 upon the lead case argued by him and CIT-DR representing the so called different cases has only relied upon the submission of Shri Chottary. 24. The last prayer by the learned Departmental Representative is that in view of the errors and omissions ITAT may set aside its order as per provisions of section 254(2) of the I.T. Act. In this regard we note that nowhere section 254(2) of the Act provides that in a Miscellaneous Application under section 254(2) of the Act ITAT can set aside an order passed by it earlier. Hence, this peal is liable to be rejected. 25. We note that following mistakes have occurred in the order of the ITAT which are apparent from record. Second category of Miscellaneous Applications contain a mistake in as much as for these appeals the matter for the Department was argued by Ms. S. Padmja, CIT-DR. But the ITAT has erroneously mentioned that the Revenue was represented by Shri S. Pandya. Hence, the same stands correct as in these categories of Miscellaneous Applications Revenue was represented by Smt. S. Padmja. Further another mistake apparent from record pointed out in Miscellaneous Application these categories is that the assessment year wrongly written as A.Y. 2007-09 instead of A.Y. 2007-08. The same stands corrected as A.Y. 2007-08 and should be read accordingly. 26. In our above decision we draw support from Hon'ble Bombay High Court decision in the case of CIT Vs. Ramesh Electric and Trading Co. (203 ITR 497). We may gainfully refer to the said decision as under:- 1. The assessee carries on a business in electrical goods and appliances. For the assessment year 1970-71, for which the accounting period is the financial year ending with 31, 1970, the assessee debited a sum of Rs. 54,000 as commission paid to one Messrs. Neeta Electric Corporation, Bombay. The firm of Messrs. Neeta Electric Corporation was a partnership firm in which two of the partners of the assessee-firm were partners. The other partners of Messrs. Neeta Electric Corporation were the wives of the partners in the assessee-firm and the fifth partner of Messrs. Neeta Electric Corporation was an employee in the assessee-firm. Thus, all the five GE Capital Services India & Loan Trust (Group cases) 70 partners of the firm of Messrs. Neeta Electric corporation had close links with the assessee-firm. 2. Under an agreement dated October 29, 1969, entered into between the assessee-firm and Messrs. Neeta Electric Corporation, it was agreed that the assessee-firm would pay a commission on purchases made by the assessee- firm through Messrs. Neeta Electric Corporation from Bombay at the rate of two per cent. on the first Rs. 20 lakhs and at 1 1/2 per cent. on any excess over Rs. 20 lakhs. 3. The assessee claimed that they had paid a sum of Rs. 54,000 to Messrs. Neeta Electric Corporation as commission during the relevant year, and this amount was claimed by the assessee-firm as a deduction under section 37 of the Income-tax Act, 1961. The Income-tax Officer disallowed this deduction after examining evidence and holding that the so-called commission was not paid for business purposes but for some other reasons. 4. The Appellate Assistant Commissioner upheld the findings of the Income- tax Officer, holding that there was no evidence produced by the assessee in respect of the services rendered by Messrs. Neeta Electric Corporation. 5. The assessee preferred an appeal before the Appellate Tribunal. The Appellate Tribunal, by its order dated June 9, 1975, dismissed the appeal. While doing so, the Tribunal also examined the relevant circumstances. It relied upon the observation of the Supreme Court in the case of CIT v. A. Raman and Co. [1968] 67 ITR 11, and held that, if, by adopting a device, it is made to appear that the income which belonged to the assessee has been earned by some other person, that income may be brought to tax in the hands of the assessee. It said that it is open to the Income tax Officer to consider the relevant facts and determine for himself whether the commission said to have been paid to the selling agents or any part thereof is properly deductible under section 37. The Tribunal observed that the assessee was asked by the Income-tax Officer to produce evidence, such as correspondence, etc., with Messrs. Neeta Electric Corporation, to prove the services rendered by Messrs. Neeta Electric Corporation. No such evidence was adduced either before the authority below or before the Tribunal. The Tribunal did not accept the assessee's explanation that all directions were given on phone, in view of the magnitude of the transactions effected. The Tribunal also noted the fact that the assessee-firm had a Bombay office for Making purchases and the expenses incurred in respect of the Bombay office were claimed as business expense. The Tribunal also noted that in the purchase bills of the assessee which were called for, there was no reference to the order being placed by the so called commission agent. The Tribunal also noted the relationship between the partners of the assessee-firm and the partners of Messrs. Neeta Electric Corporation, and said that the circumstances were collectively sufficient to compel the Tribunal to hold that the purchasing agency agreement between the appellant-firm and Messrs. Neeta Electric Corporation was only a make-believe arrangement. GE Capital Services India & Loan Trust (Group cases) 71 6. The assessee moved a Miscellaneous Application dated July 4, 1975, under section 254(2) of the Income-tax Act, 1961, seeking rectification of the order of the Tribunal dated June 9, 1975. The letter for moving this application states that, although the appeal memo before the Tribunal contained five different grounds of appeal, the order of the Tribunal dated June 9, 1975, did not mention three of these grounds of appeal. The assessee contended that the order the Tribunal did not consider some of the arguments advanced by the assessee. The Tribunal entertained this application and in the purported exercise of its power of rectification under section 254(2) of the Income-tax Act, 1961, it apparently reheard the matter, reassessed all the circumstances and allowed the deduction of commission payment to Messrs. Neeta Electric Corporation by its order dated November 6, 1975. From this order of the Tribunal dated November 6, 1975, the following two question have been referred to us under section 256(1) of the Income-tax Act, 1961 : "1. Whether, on the facts and in the circumstances of the case, the Tribunal acted without jurisdiction and/or acted beyond its jurisdiction in setting aside its order dated June 9, 1975, and allowing the appeal ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in allowing the commission of Rs. 54,000 paid to Messrs. Neeta Electric Corporation as a deduction under section 37 of the Income-tax Act, 1961 ?" 7. Under section 254(2) of the Income-tax Act, 1961, the Appellate Tribunal may, "with a view to rectifying any mistake apparent from the record", amend any order passed by it under sub-section (1) within the time prescribed therein. It is an accepted position that the Appellate Tribunal does not have any power to review its own orders under the provisions of the Income-tax Act, 1961. The only power which the Tribunal possesses is to rectify any mistake in its own order which is apparent from the record. This is merely a power of amending its order. The extent of this power of rectification was considered by the Supreme Court as far back as in 1971 in the case of T. S. Balaram, ITO v. Volkart Brothers [1971] 82 ITR 50. The Supreme Court said (headnote) : "A mistake apparent on the record must be an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on which there may be conceivably two opinions. A decision on a debatable point of law is not a mistake apparent from the record." 8. This view of the Supreme Court has held the field for a long time, and has been followed by other High Courts. Thus, for example, in the case of V. P. Minocha, ITO v. ITAT [1977] 106 ITR 691, the Gujarat High Court relying upon Balaram's case , said that a decision given by the Tribunal on a debatable point of law cannot be subsequently considered as showing any mistake apparent from the record which the Tribunal could consequently rectify. Similarly, the Madras High Court in the case of CIT v. R. GE Capital Services India & Loan Trust (Group cases) 72 Chelladurai [1979] 118 ITR 108, said that the Tribunal's power under section 254 (2) is not to review its earlier order but only to amend it with a view to rectifying any error apparent from the record. The court held that, in the case before it, the Tribunal had no power or authority to interfere with the quantum of penalty in exercise of its powers of rectification. In the case which is before us, it is obvious that the Tribunal's earlier order of June 9, 1975, was based on the merits of the case. Various arguments were advanced the Tribunal by the assessee in support of its contention that the commission of Rs. 54,000 which was paid to Messrs. Neeta Electric Corporation was a genuine payment made in the course of business dealings for purchases effected by Messrs. Neeta Electric Corporation on behalf of the assessee-firm. After examining all the circumstances, the Tribunal came to the conclusion that the payment of Rs. 54,000 was not a genuine business payment. The only grounds on which the Tribunal has subsequently purported to "rectify" its order of June 9, 1975, are (i) that the Income-tax Officer had wrongly calculated the percentage of profit of the assessee-firm while holding that the business transaction with Messrs. Neeta Electric Corporation was not a genuine business transaction, and (ii) that overlooked the argument of the assessee to the effect that, if the amount of Rs. 54,000 was taxed in the hands of the assessee as also in the hands of Messrs. Neeta Electric Corporation, it would amount to double taxation. These two arguments, according to the Tribunal, were overlooked by it while passing the earlier order, and, hence, it purported to exercise its power of rectification by re-examining all the circumstances relating to this transaction and upholding it. Clearly, this could not have been done in the exercise of any power of rectification. In the present case, in the first order, there is no mistake which is apparent from the record at all. The Tribunal was required to decide whether the commission payment of Rs. 54,000 was deductible under section 37 of the Income-tax Act. After examining the circumstances, the Tribunal came to the conclusion that it was not so deductible. The Tribunal cannot, in exercise of its power of rectification, look into some other circumstances which would support or not support its conclusion so arrived at. The mistake which the Tribunal is entitled to correct is not an error of judgment but a mistake which is apparent from the record itself. No such mistake was apparent from the record. In fact, we doubt if this sort of an exercise could have been done by the Tribunal even if it had the power of review. The Tribunal has, patently, far exceeded its jurisdiction under section 254(2) of the Income-tax Act in redeciding the entire dispute which was before it in this fashion, and the Tribunal has committed a gross and inexplicable error for reasons which we fail to understand. 9. Mr. Inamdar, learned advocate for the assessee, drew our attention to a judgment of the Madhya Pradesh High Court in the case of CIT v. Mithalal Ashok Kumar [1986] 158 ITR 755. The Madhya Pradesh High Court said that the Tribunal can correct its mistake by rectifying the same in case it is brought to its notice that the material which was already on record before deciding the appeal on merits was not considered by it. It, however, said that this will depend on the facts of each case. And whether it amounts to a review or rectification will depend on the facts of each case. In our view, these wide observations do not accord with the decision of the Supreme GE Capital Services India & Loan Trust (Group cases) 73 Court of this point in T. S. Balaram v. Volkart Brothers [1971] 82 ITR 50. Similarly, the decision of the Allahabad High Court in the case of Laxmi Electronic Corporation Ltd. v. CIT [1991] 188 ITR 398 to the effect that if the Tribunal fails or omits to deal with an important contention affecting the maintainability/merits of an appeal, it must be deemed to be a mistake apparent from the record which can be rectified by the Tribunal by its subsequent order, is also, in our view, in the teeth of the Supreme Court judgment in the case of Balaram v. Volkart Brothers [1971] 82 ITR 50. 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. 10. The questions, therefore, are answered as follows : Question No. 1 : In the affirmative and in favour of the Revenue. Question No. 2 : The Tribunal was not justified in allowing the commission of Rs. 54,000 as a deduction under section 37 of the Income-tax Act, in view of the fact that it had no jurisdiction to pass the second order on November 6, 1975. 27. We further place reliance upon Hon'ble Supreme Court decision in Civil Appeal No. 7110/2021 and others in the case of M/s. Reliance Communication Limited vide order dated 3.12.2021 for the following proposition :- 3.2 Having gone through both the orders passed by the ITAT, we are of the opinion that the order passed by the ITAT dated 18.11.2016 recalling its earlier order dated 06.09.2013 is beyond the scope and ambit of the powers under Section 254(2) of the Act. While allowing the application under Section 254(2) of the Act and recalling its earlier order dated 06.09.2013, it appears that the ITAT has re-heard the entire appeal on merits as if the ITAT was deciding the appeal against the order passed by the C.I.T. In exercise of powers under Section 254(2) of the Act, the Appellate Tribunal may amend any order passed by it under sub-section (1) of Section 254 of the Act with a view to rectifying any mistake apparent from the record only. Therefore, the powers under Section 254(2) of the Act are akin to Order XLVII Rule 1 CPC. While considering the application under Section 254(2) of the Act, the GE Capital Services India & Loan Trust (Group cases) 74 Appellate Tribunal is not required to re-visit its earlier order and to go into detail on merits. The powers under Section 254(2) of the Act are only to rectify/correct any mistake apparent from the record. 4. In the present case, a detailed order was passed by the ITAT when it passed an order on 06.09.2013, by which the ITAT held in favour of the Revenue. Therefore, the said order could not have been recalled by the Appellate Tribunal in exercise of powers under Section 254(2) of the Act. If the Assessee was of the opinion that the order passed by the ITAT was erroneous, either on facts or in law, in that case, the only remedy 5 available to the Assessee was to prefer the appeal before the High Court, which as such was already filed by the Assessee before the High Court, which the Assessee withdrew after the order passed by the ITAT dated 18.11.2016 recalling its earlier order dated 06.09.2013. Therefore, as such, the order passed by the ITAT recalling its earlier order dated 06.09.2013 which has been passed in exercise of powers under Section 254(2) of the Act is beyond the scope and ambit of the powers of the Appellate Tribunal conferred under Section 254 (2) of the Act. Therefore, the order passed by the ITAT dated 18.11.2016 recalling its earlier order dated 06.09.2013 is unsustainable, which ought to have been set aside by the High Court. 28. In the background of the aforesaid discussion and precedent these Miscellaneous Applications are dismissed except for correction of name of Departmental Representative for the Revenue in second category of cases and mention of assessment year as noted in para 25 at page No. 68 above. Order pronounced in open court on 25.3.2022. Sd/- Sd/- (VIKAS AWASTHY) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated : 25/03/2022 Copy of the Order forwarded to : 1. The Appellants : Plot No. C-22, G-Block, The IL&FS Financial Centre, Bandra Kurla Complex, Bandra East, Mumbai-400 051. 2. The Respondent 3. The CIT(A) 4. CIT 5. DR, ITAT, Mumbai 6. Guard File. BY ORDER, //True Copy// (Assistant Registrar) PS ITAT, Mumbai