Sh. Rakesh Bajaj, KOTKAPURA V. The Income Tax Officer, Faridkot

MA 54/ASR/2016

• Counselvise Citation: [2017] 124 COUNSELVISE.COM (IT) 5291 (ITAT-AMRITSAR)
• Duration Of Justice: 4 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-03-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 03-03-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 24-10-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: FAQIR CHAND FATHER OF
• Keywords: Sale consideration of property below Jantri Value; Rectification of order; Fair market value
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH.T.S. KAPOOR, ACCOUNTANT MEMBER AND SH.N.K.CHOUDHRY, JUDICIAL MEMBER M. A. NO.54(ASR)/2016 (ARISING OUT OF I.T.A NO.623(ASR)/2014) ASSESSMENT YEAR: 2011-12 RAKESH BAJAJ, S/O FAQIR CHAND BAJAJ, TULSI RAM STREET, NEAR PNB, KOTKAPURA-151204 (PB.) PAN:ABDPB-2737K VS. INCOME TAX OFFICER, WARD-III(3), FARIDKOT. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. FAQIR CHAND (FATHER OF ASSESSEE) RESPONDENT BY: SH. RAHUL DHAWAN (DR) DATE OF HEARING: 03.03.2017 DATE OF PRONOU NCEMENT:20.03.2017 ORDER PER T. S. KAPOOR (AM): THIS MISCELLANEOUS APPLICATION HAS BEEN FILED BY AS SESSEE AGAINST THE TRIBUNAL ORDER DATED 13.04.2016. 2. THE ASSESSEE IS AGGRIEVED WITH THE ORDER OF TRIB UNAL TO THE EXTENT THAT THE HONBLE TRIBUNAL SHOULD NOT HAVE REMITTED THE ISSUE BACK TO THE OFFICE OF ASSESSING OFFICER AND SHOULD HAVE ALLOWED THE APPEAL OF ASSESSEE. 3. AT THE OUTSET, SH. FAQIR CHAND (FATHER OF ASSESS EE) SUBMITTED THAT ASSESSING OFFICER HAD MADE AN ADDITION OF RS.15,83, 000/- ON THE BASIS OF M.A NO.54 (ASR)/2016 (ARISING OUT OF ITA NO.623(ASR)/2014) ASST. YEAR: 2011-12 2 CAPITAL GAIN ON SALE OF PROPERTY CALCULATED IN ACCO RDANCE WITH THE PROVISIONS OF SEC.50C(1) OF THE ACT. IT WAS SUBMITT ED THAT ASSESSEE HAD FILED WRITTEN SUBMISSIONS OBJECTING TO THE APPLICAT ION OF PROVISIONS OF SEC.50C AS THE ASSESSING OFFICER HAD IGNORED THE PR OVISIONS OF SEC.50C(2)(A) OF THE ACT. THE LD. AR SUBMITTED THAT NOW THE HONBLE TRIBUNAL HAS REMITTED BACK THE APPEAL OF ASSESSEE WITH THE DIRECTIONS TO ASSESSING OFFICER TO DETERMINE THE FAIR MARKET VALUE OF SAID PROPERTY IN ACCORDANCE WITH THE PROVISIONS OF SEC.50C2(A) OF THE ACT. THE LD. AR SU BMITTED THAT THE HONBLE TRIBUNAL WAS NOT EMPOWERED TO SEND BACK THE ISSUE BACK TO THE OFFICE OF ASSESSING OFFICER AS THE STEPS WHICH ASSE SSING OFFICER COULD NOT HAVE TAKEN AT THE TIME OF ASSESSMENT CANNOT BE TAKE N UP AT THE INSTANT OF ITAT. RELIANCE IN THIS RESPECT WAS PLACED ON A J UDGMENT OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. CHANDNI BHUCHAR 299 CTR 190 (P&H). THEREFORE, IT WAS PRAYED THAT TH ERE WAS A MISTAKE IN THE ORDER OF TRIBUNAL WHICH REQUIRED RECTIFICATION U/S 254(2) OF THE ACT. 5. THE LD. DR, ON THE OTHER HAND, HEAVILY DEFENDED THE ORDER OF TRIBUNAL AND SUBMITTED THAT HONBLE TRIBUNAL HAD RI GHTLY REMITTED THE ISSUE BACK TO THE OFFICE OF ASSESSING OFFICER AS TH IS WAS THE GRIEVANCE OF ASSESSEE AS IS APPARENT FROM THE GROUNDS OF APPEAL TAKEN BY ASSESSEE BEFORE THIS TRIBUNAL. M.A NO.54 (ASR)/2016 (ARISING OUT OF ITA NO.623(ASR)/2014) ASST. YEAR: 2011-12 3 6. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT THE ASSESSE E HAD RAISED THIS ISSUE OF NOT APPLYING PROVISIONS OF SEC.50C(2)(A) O F THE ACT BEFORE LD. CIT(A) AND LD. CIT(A) HAD REJECTED THIS ARGUMENT OF THE ASSESSEE BY HOLDING THAT ASSESSEE HAD NOT TAKEN THE PROPER PLEA DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND CIT(A) WAS NOT EMPOWERED TO REFER THE MATTER TO VALUATION OFFICER FOR VALUATION UNDER THE PROVISIONS OF SECTION 2 OF SECTION 50C. BEFORE HONBLE TRIBUNAL ALSO THE ASSESSEE HAD RAISED GROUND NO.2 AS REPRODUCED BELOW. 2. THAT LD. AO HAS ERRED IN LAW INVOKING THE PROVI SIONS OF SEC.50C(1) EVEN WHEN HE HAS RIGHTLY NOT RESORTED TO THE APPLIC ATION OF SUB-SECTION 50C(2) TO REFERRING THE CASE TO D.V.O AS THE MARKET VALUE OF THE PROPERTY IS ITSELF WRITTEN ON THE SALE DEED AND OTHER CIRCUMSTA NCES AND FACTS OF THE CASE, AND THE ASSESSEE HAS ALSO CHALLENGED THE STAM P DUTY VALUATION AND TAKE/RAISE THE PLEA BEFORE THE AO. THE HONBLE TRIBUNAL WHILE REMITTING THE ISSUE BACK TO THE OFFICE OF ASSESSING OFFICER HAS JUST RESOLVED THE GRIEVANCE O F THE ASSESSEE AND HAS DIRECTED THE ASSESSING OFFICER TO APPLY PROVISIONS OF SEC.50C READ WITH SECTION 50C(2)(A) OF THE ACT. THEREFORE, THERE CAN NOT BE SAID TO BE ANY MISTAKE IN THE ORDER OF THE TRIBUNAL. THE ARGUMENT OF LD. AR THAT THE ITAT WHILE SITTING ON THE SECOND APPEAL IS NOT SUPP OSED TO GIVE DIRECTIONS TO ASSESSING OFFICER TO DO CERTAIN THINGS WHICH HE HAD NOT DONE AT THE TIME OF ORIGINAL ASSESSMENT PROCEEDINGS IS NOT CORR ECT IN VIEW OF THE FACT THAT THE ORDER OF PUNJAB & HARYANA HIGH COURT AS RE LIED ON BY ASSESSEE IS WITH RESPECT TO AN APPEAL OF THE REVENUE AND WHE REIN THE HONBNLE M.A NO.54 (ASR)/2016 (ARISING OUT OF ITA NO.623(ASR)/2014) ASST. YEAR: 2011-12 4 COURT HAD HELD THAT ITAT WHILE SITTING IN THE SECON D APPEAL IS NOT SUPPOSED TO GIVE DIRECTIONS ON THE APPEAL OF THE RE VENUE TO SUBSTANTIATE THE ADDITION. THE HONBLE COURT FURTHER HELD THAT S TEPS WHICH ASSESSING OFFICER COULD HAVE TAKEN IF NOT TAKEN THEN THAT LAC UNA CANNOT BE FILLED AT THE END OF THE ITAT. IN OUR OPINION, THE JUDGMENT P ASSED BY HONBLE PUNAJAB & HARYANA HIGH COURT ON AN APPEAL FILED BY REVENUE IS CORRECT IN VIEW OF THE FACT THAT IT IS NOT JUSTIFIED ON THE PART OF REVENUE TO GET A SECOND CHANCE TO IMPROVE ITS CASE. IN THIS CASE, TH E APPEAL WAS FILED BY REVENUE AND ITAT HAD DIRECTED THE ASSESSING OFFICER TO SUBSTANTIATE THE ADDITION AFTER REFERENCE TO THE VALUATION OFFICER. WHEREAS THE FACTS OF THE PRESENT CASE ARE THAT ASSESSING OFFICER APPLIED THE PROVISIONS OF SECTION 50C WITHOUT CONSIDERING THE PROVISIONS OF SEC.50C(2 )(A) AND ASSESSEE WAS AGGRIEVED THAT THE ASSESSING OFFICER AND CIT(A) HAD IGNORED THE PROVISIONS OF SEC.50C(2)(A) AND THEREFORE, THE TRIB UNAL HAD ONLY DIRECTED THE ASSESSING OFFICER TO CONSIDER THE PROVISIONS OF SEC.50C(2)(A) WHILE APPLYING THE PROVISIONS OF SECTION 50C. THEREFORE, BY GIVING SUCH DIRECTIONS, THE HONBLE TRIBUNAL HAS RESOLVED THE G RIEVANCE OF ASSESSEE AND THUS, THERE IS NO MISTAKE IN THE ORDER OF THE T RIBUNAL. HERE, IT WOULD BE APT TO CONSIDER THE RELEVANT PRO VISIONS OF LAW RELATING TO SEC.254(2) OF THE ACT. A BARE LOOK AT SECTION 254(2) OF THE ACT, WHICH DE ALS WITH RECTIFICATION, MAKES IT AMPLY CLEAR THAT A MISTAKE APPARENT FROM THE RECORD IS RECTIFIABLE. IN ORDER TO ATTRACT THE APPLICATION OF SECTION 254(2), A MISTAKE MUST EXIST AND THE SAME MUST BE APPARENT FROM THE R ECORD. THE POWER TO RECTIFY THE MISTAKE, HOWEVER, DOES NOT COVER CASES WHERE A REVISION OR M.A NO.54 (ASR)/2016 (ARISING OUT OF ITA NO.623(ASR)/2014) ASST. YEAR: 2011-12 5 REVIEW OF THE ORDER IS INTENDED. MISTAKE MEANS TO TAKE OR UNDERSTAND WRONGLY OR INACCURATELY; TO MAKE AN ERROR IN INTERP RETING, IT IS AN ERROR; A FAULT, A MISUNDERSTANDING, A MISCONCEPTION. APPARE NT MEANS VISIBLE; CAPABLE OF BEING SEEN; EASILY SEEN; OBVIOUS; PLAIN, A MISTAKE WHICH CAN BE RECTIFIED UNDER SECTION 254(2) IS ONE WHICH IS PATE NT, WHICH IS OBVIOUS AND WHOSE DISCOVERY IS NOT DEPENDENT ON ARGUMENT OR ELA BORATION. THE LANGUAGE USED IN SECTION 254(2) IS PERMISSIBLE WHER E IT IS BROUGHT TO THE NOTICE OF THE TRIBUNAL THAT THERE IS ANY MISTAKE AP PARENT FROM THE RECORD. ACCORDINGLY, THE AMENDMENT OF AN ORDER DOES NOT MEA N OBLITERATION OF THE ORDER ORIGINALLY PASSED AND ITS SUBSTITUTION BY A N EW ORDER WHICH IS NOT PERMISSIBLE UNDER THE PROVISIONS OF SECTION 254(2). FURTHER, WHERE AN ERR OR IS FAR FROM SELF EVIDENT, IT CEASES TO BE AN APPARE NT ERROR. IT IS NO DOUBT TRUE THAT A MISTAKE CAPABLE OF BEING RECTIFIED UNDER SEC TION 254(2) IS NOT CONFINED TO CLERICAL OR ARITHMETICAL MISTAKES. ON T HE OTHER HAND, IT DOES NOT COVER ANY MISTAKE WHICH MAY BE DISCOVERED BY A COMP LICATED PROCESS OF INVESTIGATION, ARGUMENT OR PROOF. AS OBSERVED BY TH E SUPREME COURT IN MASTER CONSTRUCTION CO. (P.) LTD. V. STATE OF ORISS A [1966] 17 STC 360, AN ERROR WHICH IS APPARENT ON THE FACE OF THE RECORD S HOULD BE ONE WHICH IS NOT AN ERROR WHICH DEPENDS FOR ITS DISCOVERY ON ELA BORATE ARGUMENTS ON QUESTIONS OF FACT OR LAW. A SIMILAR VIEW WAS ALSO E XPRESSED IN SATYANARAYAN LAXMINARAYAN HEGDE V. MALLIKARJUN BHAV ANAPPA TIRUMALE AIR 1960 SC 137. IT IS TO BE NOTED THAT THE LANGUAG E USED IN ORDER 47, RULE 1 OF THE CODE OF CIVIL PROCEDURE, 1908 IS DIFF ERENT FROM THE LANGUAGE USED IN SECTION 254(2) OF THE ACT. POWER IS GIVEN T O VARIOUS AUTHORITIES TO RECTIFY ANY MISTAKE APPARENT FROM THE RECORD IS U NDOUBTEDLY NOT MORE THAN THAT OF THE HIGH COURT TO ENTERTAIN A WRIT PET ITION ON THE BASIS OF AN ERROR APPARENT ON THE FACE OF THE RECORD. MISTAKE IS AN ORDINARY WORD, BUT IN TAXATION LAWS, IT HAS A SPECIAL SIGNIFICANCE. IT IS NOT AN ARITHMETICAL OR CLERICAL ERROR ALONE THAT COMES WITHIN ITS PURVIEW. IT COMPREHENDS ERRORS WHICH, AFTER A JUDICIOUS PROBE INTO THE RECORD FROM WHICH IT IS SUPPOSED TO EMANATE, ARE DISCERNED. THE WORD MISTAKE IS INHER ENTLY INDEFINITE IN SCOPE, AS WHAT MAY BE A MISTAKE FOR ONE MAY NOT BE ONE FOR ANOTHER. IT IS MOSTLY SUBJECTIVE AND THE DIVIDING LINE IN BORDER A REAS IS THIN AND INDISCERNIBLE. IT IS SOMETHING WHICH A DULY AND JUD ICIOUSLY INSTRUCTED MIND CAN FIND OUT FROM THE RECORD. IN ORDER TO ATTRACT T HE POWER TO RECTIFY UNDER SECTION 254(2) IT IS NOT SUFFICIENT IF THERE IS MER ELY A MISTAKE IN THE ORDERS SOUGHT TO BE RECTIFIED. THE MISTAKE TO BE RECTIFIED MUST BE ONE APPARENT FROM THE RECORD. A DECISION ON THE DEBATABLE POINT OF LAW OR UNDISPUTED QUESTION OF FACT IS NOT A MISTAKE APPARENT FROM THE RECORD. THE PLAIN MEANING OF THE WORD APPARENT IS THAT IT MUST BE S OMETHING WHICH APPEARS TO BE SO EX FACIE AND IT IS IN CAPABLE OF A RGUMENT OR DEBATE. IT IS THEREFORE, FOLLOWS THAT A DECISION ON A DEBATABLE P OINT OF LAW OR FACT OR FAILURE TO APPLY THE LAW TO A SET OF FACTS WHICH RE MAINS TO BE INVESTIGATED CANNOT BE CORRECTED BY WAY OF RECTIFICATION. THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. K ARAM CHAND THAPAR & BR. P. LTD.,176 ITR 535 HAS HELD AS UNDER: M.A NO.54 (ASR)/2016 (ARISING OUT OF ITA NO.623(ASR)/2014) ASST. YEAR: 2011-12 6 IT IS EQUALLY WELL SETTLED THAT THE DECISION OF T HE TRIBUNAL HAS NOT TO BE SCRUTINIZED SENTENCE BY SENTENCE MERELY TO FIND OUT WHETHER ALL FACTS HAVE BEEN SET OUT IN DETAIL BY THE TRIBUNAL OR WHETHER S OME INCIDENTAL FACT WHICH APPEARS ON THE RECORD HAS NOT BEEN NOTICED BY THE TRIBUNAL IN ITS JUDGMENT. IF THE COURT, ON A FAIR READING OF THE JU DGMENT OF THE TRIBUNAL, FINDS THAT IT HAS TAKEN INTO ACCOUNT ALL RELEVANT M ATERIAL AND HAS NOT TAKEN INTO ACCOUNT ANY IRRELEVANT MATERIAL IN BASING ITS CONCLUSIONS, THE DECISION OF THE TRIBUNAL IS NOT LIABLE TO BE INTERFERED WITH , UNLESS, OF COURSE, THE CONCLUSIONS ARRIVED AT BY THE TRIBUNAL ARE- PERVERS E. IT IS NOT NECESSARY FOR THE TRIBUNAL TO STATE IN IT S JUDGMENT SPECIFICALLY OR IN EXPRESS WORDS THAT IT HAS TAKEN INTO ACCOUNT THE CU MULATIVE EFFECT OF THE CIRCUMSTANCES OR HAS CONSIDERED THE TOTALITY OF THE FACTS, AS IF THAT WERE A MAGIC FORMULA; IF THE JUDGMENT OF THE TRIBUNAL SHOW S THAT IT HAS, IN FACT, DONE SO, THERE IS NO REASON TO INTERFERE WITH THE D ECISION OF THE TRIBUNAL. SIMILARLY, THE HON,BLE MADRAS HIGH COURT DECISIONS IN T.C.(A) NO. 156 OF 2006 DATED 21.08.2007 IN THE CASE OF CIT VS. TAMIL NADU SMALL INDUSTRIES DEVELOPMENT CORPORATION LTD. WHEREIN THE HONBLE HIGH COURT HELD AS UNDER: THE TRIBUNAL HAS NO POWER TO REVIEW ITS ORDER. WHE N THE TRIBUNAL HAS ALREADY DECIDED AN ISSUE BY APPLYING ITS MIND AGAIN ST THE ASSESSEE, THE SAME CANNOT BE RECTIFIED UNDER SECTION 254 (2) OF T HE ACT. THERE WAS NO NECESSITY WHATSOEVER ON THE PART OF THE TRIBUNAL TO REVIEW ITS OWN ORDER. EVEN AFTER THE EXAMINATION OF THE JUDGMENTS OF THE TRIBUNAL, WE COULD NOT FIND A SINGLE REASON IN THE WHOLE ORDER AS TO HOW T HE TRIBUNAL IS JUSTIFIED AND FOR WHAT REASONS. THERE IS NO APPARENT ERROR ON THE FACE OF THE RECORD AND THEREBY THE TRIBUNAL SAT AS AN APPELLATE AUTHOR ITY OVER ITS OWN ORDER. IT IS COMPLETELY IMPERMISSIBLE AND THE TRIBUNAL HAS TRAVELED OUT OF ITS JURISDICTION TO ALLOW A MISCELLANEOUS PETITION IN T HE NAME OF REVIEWING ITS OWN ORDER. IN THE PRESENT CASE, IN THE GUISE OF RECTIFICATION , THE TRIBUNAL REVIEWED ITS EARLIER ORDER AND ALLOWED THE MISCELLANEOUS PETITIO N WHICH IS NOT IN ACCORDANCE WITH LAW. SECTION 254(2) OF THE ACT DOES NOT CONTEMPLATE REHEARING OF THE APPEAL FOR A FRESH DISPOSAL AND DO ING SO, WOULD OBLITERATE THE DISTINCTION BETWEEN THE POWER TO RECTIFY MISTAK ES AND POWER TO REVIEW THE ORDER MADE BY THE TRIBUNAL. THE SCOPE AND AMBIT OF THE APPLICATION OF SECTION 254(2) IS LIMITED AND NARROW. IT IS RESTRIC TED TO RECTIFICATION OF MISTAKES APPARENT FROM THE RECORD. RECALLING THE OR DER OBVIOUSLY WOULD MEAN PASSING OF A FRESH ORDER. RECALLING OF THE ORDER IS SNOT PERMISSIBLE UNDER SE C.254(2) OF THE ACT. ONLY GLARING AND ANY MISTAKE APPARENT ON THE FACE OF THE RECORD ALONE CAN BE M.A NO.54 (ASR)/2016 (ARISING OUT OF ITA NO.623(ASR)/2014) ASST. YEAR: 2011-12 7 RECTIFIED AND HENCE ANYTHING DEBATABLE CANNOT BE A SUBJECT MATTER OF RECTIFICATION. FURTHER, THE HONBLE DELHI HIGH COURT JUDGMENT ON T HE SCOPE OF RECTIFICATION U/S 254(2) AS REPORTED IN THE CASE OF RAS BIHARI BANSAL VS. CIT 293 ITR 365 HAS HELD AS UNDER: SECTION 254 OF THE INCOME TAX ACT, 1961, ENABLES T HE CONCERNED AUTHORITY TO RECTIFY ANY MISTAKE APPARENT FROM THE RECORD. IT IS WELL SETTLED THAT AN OVERSIGHT OF A FACT CANNOT CONSTITUTE AN APPARENT M ISTAKE RECTIFIABLE UNDER THIS SECTION. SIMILARLY, FAILURE OF THE TRIBUNAL TO CONSIDER AN ARGUMENT ADVANCED BY EITHER PARTY FOR ARRIVING AT A CONCLUSI ON, IS NOT AN ERROR APPARENT ON THE RECORD, ALTHOUGH IT MAY BE AN ERROR OF JUDGMENT. THE MERE FACT THAT THE TRIBUNAL HAD NOT ALLOWED A DEDUCTION, EVEN IF THE CONCLUSION IS WRONG, WILL BE NO GROUND FOR MOVING AN APPLICATI ON UNDER SECTION 254(2) OF THE ACT. FURTHER, IN THE GARB OF AN APPLICATION FOR RECTIFICATION, THE ASSESSEE CANNOT BE PERMITTED TO REOPEN AND RE-ARGUE THE WHOLE MATTER, WHICH IS BEYOND THE SCOPE OF THE SECTION. THEREFORE, IN VIEW OF THE FACTS AND CIRCUMSTANCES O F THE CASE, AND IN THE LIGHT OF RATIO OF THE DECISIONS CITED AND DI SCUSSION AS HELD ABOVE, WE DO NOT FIND ANY SUBSTANCE IN THE APPLICATION OF ASSESSEE AND DISMISS THE SAME BEING DEVOID OF ANY MERITS. 7. IN THE RESULT, THE MISCELLANEOUS APPLICATION FIL ED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 20.03. 2017 . SD/- SD/- (N.K.CHOUDHRY) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:20.03.2017. /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), M.A NO.54 (ASR)/2016 (ARISING OUT OF ITA NO.623(ASR)/2014) ASST. YEAR: 2011-12 8 (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER