Sri muninaga Reddy, Bangalore V. Assistant Commisioner of Income tax, Bangalore

MA 62/BANG/2015

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 3825 (ITAT-BANGALORE)
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-01-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 09-10-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 07-04-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NARENDRA REBELLA ACIT
• Assessee Lawyers: P DINESH
• Keywords: Rectification of order
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, BANGALORE BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER M.A.NO.62 /BANG/ 2015 ( IN ITA NOS.859 /BANG/ 2012) (ASSESSMENT YEARS : 2006 - 07 ) SRI MUNINAGA REDDY, NO.4 5, 3 RD B MAIN, 4 TH CROSS, 3 RD BLOCK, KALYAN NAGAR, BANGALORE - 560 043. PAN NO.AFLPR5736E PETITIONER ASST. COMMISSIONER OF INCOME - TAX, CIRCLE 6(1) BANGALORE . RESPONDENT PETITIONER BY : SHRI P. DINESH, ADVOCATE . RESPONDENT BY : SHRI NARENDRA REBELLA, ACIT DATE OF HEARING : 20/11/2015 DATE OF PRONOUNCEMENT : 20 /01/2016 O R D E R PER I NTURI RAMA RAO, AM : THIS MISCELLANEOUS PETITION WAS FILED BY THE ASSESSEE SEEKING RECTIFICATION OF MISTAKE IN THE ORDER PASSED BY THIS TRIBUNAL IN ITA NO.859 / BANG/ 2012 DATED 13 - 01 - 2015 FOR THE ASSESSMENT YEAR 2006 - 07 . 2. THIS TRIBUNAL VIDE IMPUGNED ORDER HAD CONFIRMED THE LEVY OF PENALTY UNDER THE PROVISIONS OF SEC.271(1)(C) OF THE IT ACT, 1961. THE ASSESSEE THROUGH THIS PRESE NT PETITION SUBMITS THAT MP NO . 62 /BANG/201 5 PAGE 2 OF 7 WHILE PASSING THE IMPUGNED ORDER , THE TRIBUNAL HAD NOT CONSIDERED THE SUBMISSIONS OF THE ASSESSEE THAT THE SHOW CAUSE NOTICE WAS ISSUED IN A MECHANICAL MANNER WITHOUT APPLICATION OF MIND . 3. DURING THE COURSE OF HEARING OF THI S PETITION , LEARNED COUNSEL FOR THE ASSESSEE HAD POINTED OUT THAT THOUGH THIS HON BLE TRIBUNAL HAD REFERRED TO THE DECISION OF THE HON BLE HIGH COURT OF KARNATAKA IN THE CASE OF CIT VS MANJUNATHA COTTON & GINNING FACTORY 357 ITR 565(KAR.) NO FINDING WAS RE NDERED ON THIS ASPECT. THEREFORE, HE SUBMITTED THAT THE ORDER MAY BE RECALLED IN ORDER TO ADJUDICATE THIS GROUND OF APPEAL. 4. ON THE OTHER HAND, LEARNED SR .DR RELIED ON THE ORDERS OF THE TRIBUNAL AND SUBMITTED THAT THE TRIBUNAL HAD CONSIDERED AL L THE GROUNDS OF APPEAL AND ADJUDICATED THE MATTER AND SUBMITTED THAT THE APPEAL CANNOT BE RE - ARGUED UNDER THE PROVISIONS OF 254(2) OF THE IT ACT, 1961. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ONLY ISSUE RAISE D IN THE PRESENT PETITION IS THAT THE TRIBUNAL HAD FAILED TO ADJUDICATE THE GROUND THAT THE SHOW CAUSE NOTICE WAS ISSUED , BEFORE LEVY OF PENALTY U/S 271(1)(C) OF THE IT ACT, 1961 , IN A MECHANICAL MANNER WITHOUT APPLICATION OF MIND. ON M ERE PERUSAL OF THE GROUND S OF APPEAL RAISED IN THE MEMO OF APPEAL SHOWS THAT NO SUCH GROUND WAS MP NO . 62 /BANG/201 5 PAGE 3 OF 7 RAISED BEFORE THIS TRIBUNAL NOR THE COUNSEL FOR THE ASSESSEE COULD DEMONSTRATE BEFORE US THAT THE ISSUE WAS ARGUED DURING THE COURSE OF HEARING OF THE APPEAL BEFORE THE TRIBUNAL. NO DOUBT, THE DECISION OF THE HON BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS MANJUNATHA COTTON & GINNING FACTORY( S UPRA) WAS REFERRED BY THE COUNSEL DURING THE COURSE OF HEARING OF THE APPEAL, BUT IT WAS ONLY IN SUPPORT OF THE PROPOSITION THAT IN THE ABSENCE OF MALA FIDE ON THE PART OF THE ASSESSEE , NO P ENALTY CAN BE LEVIED U/S 271(1)(C) OF THE IT ACT, 1961. THIS TRIBUNAL HAD CONSIDERED THIS DECISION AND RENDERED A FINDING AT PARA - 5.2 OF THE ORDER. THERE IS NO WHISPER EITHER IN THE ORDER OF THE CIT(A) OR IN THE ORDER OF THE TRIBUNAL THAT THE ASSESSEE HAD ADVANCED THIS PLEA. NO NEW PLEA CAN BE RAISED BY INVOKING THE JURISDICTION OF THE TRIBUNAL U/S 254(2) OF THE IT ACT, 1961. THE TRIBUNAL IS BOUND TO ADJUDICATE ONLY ON THE GROUND S WHICH ARE SPE CIFICALLY RAISED AND URGED BY THE ASSESSEE TO WHICH SPECIFIC ATTENTION OF THE TRIBUNAL WAS DRAWN. THIS IS IN CONFORMITY WITH THE PROVISIONS OF SUB - RULE (6) OF RULE 18 OF THE INCOME - TAX (APPELLATE TRIBUNAL) RULES, 1963. 6. THE SCOPE OF PROVISIONS OF SEC.254(2) OF THE IT ACT, 1961 WERE ELABORATED OR REITERATED BY THE HON BLE MADRAS HIGH COURT IN THE CASE OF EXPRES S NEWSPAPERS LTD. VS DCIT AND A NOTHER (320 ITR 12) WHEREIN IT WAS HELD AT PAR A. 12 & 13 AS UNDER : 12 . THE SCOPE AND AMPLITUDE OF SEC. 254(2 ) AND THE ANALOGOUS PROVISION S. 154 OF THE ACT HAVE BEEN CONSIDERED BY CATENA OF DECISIONS OF THE APEX COURT AND MP NO . 62 /BANG/201 5 PAGE 4 OF 7 OTHER HIGH COURTS. THE UNIFORM OPINION OF THE COURTS OF SUPERIOR JURISDICTION IS THAT A PATENT, MANIFEST AND SELF - EVIDENT ERROR WHICH DOES NOT REQUIRE ELABORATE DISCUSSION OF EVIDENCE OR ARGUMENT TO ESTABLISH IT, CAN BE SAID TO BE AN ERROR APPARENT ON THE FACE OF THE RECORD AND CAN BE CORRECTED UNDER S. 254(2). AN ERROR CANNOT BE SAID TO BE APPARENT ON THE FACE OF THE RECORD IF ONE HAS TO TRAVEL BEYOND THE RECORD TO SEE WHETHER THE JUDGMENT IS CORRECT OR NOT. AN ERROR APPARENT ON THE RECORD MEANS AN ERROR WHICH STRIKES ONE ON MERE LOOKING AND DOES NOT NEED A LONG DRAWN OUT PROCESS OF REASONING ON POINTS ON WHICH THERE MAY BE CONCEIVABLY TWO OPINI ONS. THE ERROR SHOULD NOT REQUIRE ANY EXTRANEOUS MATTER TO SHOW ITS INCORRECTNESS. TO PUT IT DIFFERENTLY, IT SHOULD BE SO MANIFEST AND CLEAR THAT NO COURT WOULD PERMIT IT TO REMAIN ON RECORD. IF THE VIEW ACCEPTED BY THE COURT IN THE ORIGINAL JUDGMENT IS ON E OF POSSIBLE VIEWS, THE CASE CANNOT BE SAID TO BE COVERED BY AN ERROR APPARENT ON THE FACE OF THE RECORD. SEC. 254(2) SPECIFICALLY EMPOWERS THE TRIBUNAL TO AMEND AT ANY TIME WITHIN FOUR YEARS FROM THE DATE OF AN ORDER, ANY ORDER PASSED BY IT UNDER S. 254( 1) WITH A VIEW TO RECTIFY ANY MISTAKE APPARENT FROM THE RECORD EITHER SUO MOTU OR ON AN APPLICATION. IN ORDER TO ATTRACT THE APPLICATION OF S. 254(2), THE MISTAKE MUST EXIST AND THE SAME MUST BE APPARENT FROM THE RECORD. THE EXPRESSION 'MISTAKE APPARENT FR OM THE RECORD' CONTAINED IN SS. 154 AND 254(2) HAS WIDER CONTENT THAN THE EXPRESSION 'ERROR APPARENT ON THE FACE OF THE RECORD' OCCURRING IN ORDER 47 R. 1 OF CPC. THE RESTRICTIONS ON THE POWER OF REVIEW UNDER ORDER 47 R. 1 OF CPC DO NOT HOLD GOOD IN THE CA SES OF SS. 254(2) AND 154 OF THE ACT. SEC. 254(2) DOES NOT CONFER POWER ON THE TRIBUNAL TO REVIEW ITS EARLIER ORDER. UNDER THE GARB OF RECTIFICATION OF MISTAKE IT IS NOT POSSIBLE FOR A PARTY TO TAKE FURTHER CHANCE OF RE - ARGUING THE APPEAL ALREADY DECIDED. WHAT CAN BE RECTIFIED UNDER S. 254(2) IS A MISTAKE WHICH IS APPARENT AND PATENT. THE MISTAKE HAS TO BE SUCH FOR WHICH NO ELABORATE REASONS OR ENQUIRY IS NECESSARY. WHERE TWO OPINIONS ARE POSSIBLE THEN IT CANNOT BE SAID TO BE A MISTAKE APPARENT ON THE RECOR D. WHEN PREJUDICE RESULTING FROM AN ORDER IS ATTRIBUTABLE TO THE TRIBUNAL S MISTAKE, ERROR OR OMISSION, IT IS ITS BOUNDEN DUTY TO SET IT RIGHT. THE PURPOSE BEHIND THE ENACTMENT OF S. 254(2) OF THE ACT TO AMEND ANY ORDER PASSED UNDER SUB - S. (1), IF ANY MIST AKE APPARENT FROM THE RECORDS IS BROUGHT TO THE NOTICE OF THE TRIBUNAL, IS BASED ON THE FUNDAMENTAL PRINCIPLE THAT NO PARTY APPEARING BEFORE THE TRIBUNAL, BE IT AN ASSESSEE OR THE DEPARTMENT, SHOULD SUFFER ON ACCOUNT OF ANY MISTAKE MP NO . 62 /BANG/201 5 PAGE 5 OF 7 COMMITTED BY THE TRIBUNA L. THIS FUNDAMENTAL PRINCIPLE HAS NOTHING TO DO WITH THE INHERENT POWER OF THE TRIBUNAL. IF PREJUDICE IS RESULTED TO THE PARTY, WHICH PREJUDICE IS ATTRIBUTABLE TO THE TRIBUNAL S MISTAKE, ERROR OR OMISSION AND WHICH ERROR IS A MANIFEST ERROR, THEN THE TRIBU NAL WOULD BE JUSTIFIED IN RECTIFYING ITS MISTAKE. RECTIFICATION CAN BE MADE ONLY WHEN A GLARING MISTAKE OF FACT OR LAW COMMITTED BY THE OFFICER PASSING THE ORDER BECOMES APPARENT FROM THE RECORD. THE RECTIFICATION IS NOT POSSIBLE IF THE QUESTION IS DEBATAB LE. A POINT WHICH WAS NOT EXAMINED ON FACTS OR IN LAW CANNOT BE DEALT WITH AS A MISTAKE APPARENT FROM THE RECORD. NO ERROR CAN BE SAID TO BE APPARENT ON THE FACE OF THE RECORD IF IT IS NOT MANIFEST OR SELF - EVIDENT AND REQUIRES AN EXAMINATION OR ARGUMENT TO ESTABLISH IT. WHERE WITHOUT ANY ELABORATE ARGUMENT ONE COULD POINT TO THE ERROR AND SAY HERE IS A SUBSTANTIAL POINT OF LAW WHICH STARES ONE IN THE FACE, AND THERE COULD REASONABLY BE NO TWO OPINIONS ENTERTAINED ABOUT IT, IS A CLEAR CASE OF ERROR APPARENT ON THE FACE OF THE RECORD. VIDE ASSTT. CIT VS. SAURASHTRA KUTCH STOCK EXCHANGE LTD. (2008) 219 CTR (SC) 90 : (2008) 12 DTR (SC) 346 : (2008) 305 ITR 227 (SC), HONDA SIEL POWER PRODUCTS LTD. VS. CIT (2007) 213 CTR (SC) 425 : (2007) 295 ITR 466 (SC), HARI VI SHNU KAMATH VS. AHMAD ISHAQUE (1955) 1 SCR 1104, CIT VS. KESHRI METAL (P) LTD. (1999) 155 CTR (SC) 531 : (1999) 237 ITR 165 (SC), DEVA METAL POWER (P) LTD. VS. CIT 2008 (2) SCC 439, CIT VS. HERO CYCLES (P) LTD. (1997) 142 CTR (SC) 122 : (1997) 228 ITR 463 (SC), SATYANARAYAN LAXMINARAYAN HEGDE VS. MALLIKARJUN BHAVANAPPA TIRUMALE (1960) 1 SCR 890, THUNGABHADRA INDUSTRIES LTD. VS. GOVERNMENT OF ANDHRA PRADESH, REP. BY THE DY. CCT AIR 1964 SC 1372, BATUK K. VLYAS VS. SURAT BOROUGH MUNICIPALITY ILR 1953 BOM 191, MRS. K.T.M.S. UMMA SALMA VS. CIT (1983) 144 ITR 890, 895 (MAD), KIL KOTAGIRI TEA & COFFEE ESTATES CO. LTD. VS. ITAT (1989) 75 CTR (KER) 115 : (1988) 174 ITR 579 (KER), CIT VS. R. CHELLADURAI (1979) 11 CTR (MAD) 157 : (1979) 118 ITR 108 (MAD), STATE OF TAM IL NADU VS. THAKOREBHAI & BROS. (1983) 52 STC 104 (MAD), JAINARAIN JEEVRAJ VS. CIT (1979) 13 CTR (RAJ) 342 : (1980) 121 ITR 358, 363 (RAJ), CIT VS. VARDHMAN SPINNING (1997) 139 CTR (P&H) 322 : (1997) 226 ITR 296, 302 (P&H), BATA INDIA LTD. VS. DY. CIT (199 6) 217 ITR 871 (CAL) AND CIT VS. PRAHLAD RAI TODI (2001) 171 CTR (GAU) 537 : (2001) 251 ITR 833 (GAU). 13. FROM THE VARIOUS JUDGMENTS OF THE SUPREME COURT ABOVE REFERRED TO AND OTHER HIGH COURTS, IT IS MP NO . 62 /BANG/201 5 PAGE 6 OF 7 CLEAR THAT THE TRIBUNAL S POWER UNDER S. 254(2) IS NOT TO REVIEW ITS EARLIER ORDER BUT ONLY TO AMEND IT WITH A VIEW TO RECTIFY ANY MISTAKE APPARENT FROM THE RECORD. WHAT CAN BE TERMED AS 'MISTAKE APPARENT ?'. 'MISTAKE' IN GENERAL MEANS TO TAKE OR UNDERSTAND WRONGLY OR INACCURATELY; TO MAKE AN ERROR IN INTERPR ETING; IT IS AN ERROR; A FAULT, A MISUNDERSTANDING, A MISCONCEPTION. MISTAKE IN TAXATION LAWS HAS A SPECIAL SIGNIFICANCE. IT IS MOSTLY SUBJECTIVE AND THE DIVIDING LINE IS THIN AND INDISCERNIBLE. 'APPARENT' MEANS VISIBLE, CAPABLE OF BEING SEEN, EASILY SEEN, OBVIOUS PLAIN, OPEN TO VIEW, EVIDENT, APPEARS, APPEARING AS REAL AND TRUE, CONSPICUOUS, MANIFEST, SEEMING. THE PLAIN MEANING OF THE WORD 'APPARENT' IS THAT IT MUST BE SOMETHING WHICH APPEARS TO BE EX FACIE AND INCAPABLE OF ARGUMENT AND DEBATE. IF SUCH A ' MISTAKE APPARENT ON THE FACE OF RECORD' IS BROUGHT TO THE NOTICE, S. 254(2) EMPOWERS THE TRIBUNAL TO AMEND THE ORDER PASSED UNDER S. 254(1). AMENDMENT OF AN ORDER DOES NOT MEAN OBLITERATION OF THE ORDER ORIGINALLY PASSED AND ITS SUBSTITUTION BY A NEW ORDER . WHAT IS MISTAKE APPARENT ON THE FACE OF THE RECORD OR WHERE DOES A MISTAKE CEASE TO BE MERE MISTAKE, AND BECOME MISTAKE APPARENT ON THE FACE OF THE RECORD IS RATHER DIFFICULT TO DEFINE PRECISELY, SCIENTIFICALLY AND WITH CERTAINTY. AN ELEMENT OF INDEFINIT ENESS INHERENT IN ITS VERY NATURE AND IT MUST BE DISCERNIBLE FROM THE FACTS OF EACH CASE BY JUDICIOUSLY TRAINED MIND. MERE EXISTENCE OF A MISTAKE OR ERROR WOULD NOT PER SE RENDER THE ORDER AMENABLE FOR RECTIFICATION, BUT SUCH A MISTAKE MUST BE ONE WHICH MU ST BE MANIFEST ON THE FACE OF THE RECORD . APPLYING THE ABOVE LEGAL PROPOSITION TO THE FACTS OF THE PRESENT CASE, IT IS CRYSTAL CLEAR THAT THERE IS NO MISTAKE A PPARENT FROM RECORD WHICH IS CA P ABLE OF BEING RECTIFIED BY EXERCISING THE POWER VESTED U/S 254(2 ) OF THE IT ACT, 1961. HENCE, THE MISCELLANEOUS PETITION FILED BY THE ASSESSEE IS DISMISSED. MP NO . 62 /BANG/201 5 PAGE 7 OF 7 7. IN THE RESULT, THE M.P FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 20 TH DAY OF JANUARY, 2016 SD/ - (V IJAY PAL RAO ) SD/ - (I NTURI RAMA RAO ) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE : BANGALORE D A T E D : 20 /01/2016 SRINIVASULU, SPS COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A) - II BANGALORE 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME - TAX APPELLATE TRIBUNAL BANGALORE