M/s DHARTI BREDING & INFRASTRUCTURE LTD., HYDERABAD, Hyderabad V. ADDL. CIT, RANGE-1, Hyderabad

MA 69/HYD/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0845 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 16 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 23-08-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 08-03-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S RAMU
• Keywords: Depreciation; Rectification of order; Retrospective amendment; Question of law; Reasonable cause; Competent authority; Assessment record; Unabsorbed depreciation
• Section: 143(3); 32

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA `VIJAYARAGHAVAN, JUDICIAL MEMBER MA NO. 69/HYD/2013 (IN ITA NO. 145/HYD/2012 A.Y. 2007-08 M/S DHARTI DREDGING & INFRASTRUCTURE LTD., HYDERABAD. (PAN AABCD6612M) VS . ADDL. COMMISSIONER OF INCOME-TAX, RANGE 1, HYDERABAD. APPELLANT RESPONDENT APPELLANT BY: SHRI SATISH KUMAR RESPONDENT BY: SHRI S. RAMU DATE OF HEARING: 02.08.2013 DATE OF PRONOUNCEMENT: 23/08/2013 O R D E R PER CHANDRA POOJARI, A.M.: THE ABOVE MISCELLANEOUS APPLICATION (MA) FILED BY ASSESSEE IS SEEKING RECTIFICATION IN THE ORDER OF T HE TRIBUNAL DATED 16/11/2012. 2. IN THE M.A. THE ASSESSEE HAS STATED AS FOLLOWS: THE ABOVE MENTIONED APPEAL FILED BY THE ASSESSEE HAS BEEN DISPOSED OF BY HON'BLE ITAT, HVDERABAD A BENCH BY ITS ORDER DATED 16.11.2012. THE APPELLANT ABOVE NAMED BEGS TO PLACE THIS APPLICATION FOR RECTIFICATION OF CERTAIN MISTAKES WHICH ARE APPARENT FROM RECORD IN THE SAID ORDER. GROUND OF APPEAL NOS.1 & 2 IN THIS APPEAL DISPUTED THE ORDER OF COMMISSIONER OF INCOME TAX, HYDERABAD HOLDING THAT THE ACTION OF THE MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 2 ASSESSING OFFICER TO ALLOW THE APPELLANT SET OFF OF UNABSORBED DEPRECIATION OF ASSESSMENT YEARS 1990-97 AND 1998-99 IN THE COMPUTATION OF THE APPELLANT'S TAX LIABILITY FOR THE CURRENT ASSESSMENT YEAR IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. DURING THE COURSE OF HEARING BEFORE ITAT THE APPELLANT POINTED OUT THAT THE VIEW TAKEN BY ASSESSING OFFICER IN THIS BEHALF IS IN ACCORDANCE WITH CBDT CIRCULAR AND GUJARAT HIGH COURT JUDGMENT DATED 23 RD AUGUST 2012 IN SPECIAL CIVIL APPLICATION NO.1773 OF 2012 IN THE CASE OF GENERAL MOTORS INDIA (P) LTD. VS. DCIT. HENCE THE VIEW TAKEN BY ID. ASSESSING OFFICER IS CORRECT VIEW THE APPELLANT FURTHER URGED BEFORE HON'BLE TRIBUNAL THAT THE CIRCULAR AND JUDGMENT OF HON'BLE GUJARAT HIGH COURT ESTABLISHED BEYOND DOUBT THAT THE VIEW TAKEN BY ID. ASSESSING OFFICER IN THIS BEHALF IS AT LEAST ONE OF THE POSSIBLE VIEWS THAT CAN BE LAWFULLY TAKEN BY THE ASSESSING OFFICER. THOUGH THE DECISION OF ITAT SPECIAL BENCH IN THE CASE OF MJ S.TIMES GUARANTEE LIMITED 131 TTJ (MUM) (SB) 257 WAS AGAINST THE ASSESSEE, THE FACT THAT A SPECIAL BENCH WAS CONSTITUTED PROVES THAT THERE WAS MORE THAN ONE VIEW POSSIBLE. THE APPELLANT SUBMITTED THAT IF ASSESSING OFFICER TAKES ONE OF THE TWO POSSIBLE VIEWS IN FAVOUR OF THE ASSESSEE AND NOT IN FAVOUR OF THE REVENUE, THE VIEW TAKEN BY THE ASSESSING OFFICER CANNOT BE SAID TO BE ERRONEOUS AS LONG AS IT REPRESENTS A VIEW WHICH CAN POSSIBLY BE TAKEN ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE OF THE ASSESSEE AND IN LAW. THEREFORE, ID. CIT CANNOT SUBSTITUTE HIS VIEW FOR THE VIEW TAKEN BY THE ASSESSING OFFICER. THE APPELLANT PLACED RELIANCE IN THIS RESPECT BEFORE HON'BLE TRIBUNAL ON THE JUDGMENT OF SUPREME COURT IN THE CASE OF MALABAR INDUSTRIAL CO. LTD. VS. CIT 109 TAXMAN 66 (SE) & CIT VS. GABRIEL INDIA LIMITED 203 ITR 108 (BOM). HON'BLE ITAT HAS HOWEVER HELD THAT THE ASSESSING OFFICER HAD MECHANIC ALL ACCEPTED THE APPELLANT'S CLAIM OF SET OFF OF UNABSORBED DEPRECIATION WITHOUT MAKING ANY ENQUIRY. IN THE WORDS OF HON'BLE TRIBUNAL, 'ORDER PASSED BY THE ASSESSING OFFICER BECOMES ERRONEOUS BECAUSE MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 3 AN ENQUIRY HAS NOT BEEN MADE OR GENUINENESS OF THE CLAIM HAS NOT BEEN EXAMINED WHERE THE INQUIRIES OUGHT TO HAVE BEEN MADE AND THE GENUINENESS OF THE CLAIM OUGHT TO HAVE BEEN EXAMINED'. HON'BLE TRIBUNAL FURTHER OBSERVED, THE ASSESSMENT ORDER PLACED BEFORE US IS CLEARLY ERRONEOUS AS IT WAS PASSED WITHOUT PROPER EXAMINATI ON OR ENQUIRY OR VERIFICATION OR OBJECTIVE CONSIDERATION OF THE CLAIM MADE BY THE ASSESSEE'. HON'BLE TRIBUNAL HAS CONSEQUENTIALLY HELD THAT THE ORDER MADE BY THE ASSESSING OFFICER WAS ERRONEOUS AND THEREFORE RIGHTLY REVISED BY CIT IN THE ORDER U/ S.263 IMPUGNED BEFORE THEM. 3. THE APPELLANT FURTHER STATED AND SUBMITTED THAT THE ORDER AND OBSERVATIONS OF HON'BLE TRIBUNAL AS ENUMERATED IN THE FOREGOING PARAGRAPH SUFFER FROM MISTAKES APPARENT FROM RECORD, FOR THE FOLLOWING REASONS: 1. THE PROVISIONS OF DEPRECIATION ALLOWANCE AS LAID DOWN IN THE PROVISIONS OF SECTION 32 ENVISAGE THAT WHILE COMPUTING THE ASSESSEE'S TOTAL INCOME DEDUCTION OF DEPRECIATION SHALL BE ALLOWED ON THE ACTUAL COST TO THE ASSESSEE OR THE WRITTEN DOWN VALUE OF THE ASSET OR BLOCK OF ASSET OWNED WHOLLY OR PARTLY BY ASSESSEE AND USED FOR THE PURPOSE OF BUSINESS AT SUCH PERCENTAGE AS MAY BE PRESCRIBED UNDER INCOME TAX RULES. IF HOWEVER IN ANY ASSESSMENT OF AN ASSESSEE FULL EFFECT CANNOT BE GIVEN TO ANY DEPRECIATION ALLOWANCE, OWING TO THERE BEING NO PROFITS OR GAINS CHARGEABLE FOR THAT PREVIOUS YEAR OR OWING TO PROFIT OR GAINS CHARGEABLE BEING LESS THAN THE DEPRECIATION ALLOWANCE, THEN THE ALLOWANCE OR PART OF ALLOWANCE TO WHICH MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 4 EFFECT HAS NOT BEEN GIVEN SHALL BE ADDED TO THE AMOUNT OF THE ALLOWANCE FOR DEPRECIATION FOR THE FOLLOWING PREVIOUS YEAR AND SO ON FOR THE SUCCEEDING PREVIOUS YEARS. FROM THESE PROVISIONS IT WOULD BE SEEN THAT UNABSORBED DEPRECIATION ALLOWANCE IS ENTIRELY THE MATTER OF EXISTING RECORD OF THE ASSESSEE IN RELATION TO PAST ASSESSMENT YEARS AND THEREAFTER WHENEVER AN ASSESSMENT IS COMPLETED SET OFF OF UNABSORBED DEPRECIATION IS A MATTER OF REFERENCE TO THE RECORD ALREADY EXISTING WITH THE ASSESSING OFFICER. FOR ASSESSMENT YEAR 2007-08, UNDER CONSIDERATION, THE APPELLANT FURNISHED COMPLETE PARTICULARS OF THE UNABSORBED DEPRECIATION TO BE SET OFF IN COMPUTATION OF TOTAL INCOME OF ASSESSMENT YEAR 2007-08 IN THE STATEMENT OF INCOME; A COPY OF WHICH WAS PLACED BEFORE HON'BLE TRIBUNAL IN THE PAPER BOOK FILED BY THE APPELLANT AT PAGES 1 TO 3 OF PAPER BOOK II FILED AT THE TIME OF HEARING. THE AMOUNT QUANTIFIED BY THE APPELLANT FOR UNABSORBED DEPRECIATION AND BROUGHT FORWARD LOSSES WAS RS.19,35,23,894/ - WHEREAS IN THE ASSESSMENT ORDER MADE ON 29.12.2009, LD. ASSESSING OFFICER HAS QUANTIFIED THE AMOUNT OF DEDUCTION AT RS.21,28,16,977/ - ON THE BASIS OF THE ASSESSMENT RECORDS OF THE APPELLANT FOR EARLIER YEARS. LD. ASSESSING OFFICER ALLOWED THE APPELLANT SET OFF OF BROUGHT FORWARD LOSSES AT HIGHER AMOUNT IN VIEW OF THE VARIOUS DISALLOWANCES MADE BY HIM IN THE ASSESSMENT MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 5 ORDER AND ON THE BASIS OF INFORMATION AVAILABLE WITH HIM FROM THE COMPLETED ASSESSMENT PROCEEDINGS OF EARLIER YEARS. THE APPELLANT MOST HUMBLY BEGS TO SUBMIT THAT THE MISTAKES APPARENT FROM RECORD IN THE ORDER OF HON'BLE TRIBUNAL HAS EMANATED FROM THE TRIBUNAL HAVING TREATED THE SET OFF OF UNABSORBED DEPRECIATION AS A MATTER OF ENQUIRY AND INVESTIGATION WHEREAS THE SAME IS A MATTER OF RECORD. 2. LD. CIT IN HIS ORDER U/S.263 MADE ON 26.12.2011 WHICH WAS IMPUGNED BEFORE HON'BLE TRIBUNAL HAS NOWHERE ACCUSED THE ASSESSING OFFICER OF HAVING FAILED TO MAKE AN ENQUIRY AS RESPECTS TO THE SET OFF OF UNABSORBED DEPRECIATION ALLOWED BY THE ASSESSING OFFICER AND OBJECTIONS OF LD. CIT ARE CONFINED TO HIS OWN VIEW THAT THE ASSESSING OFFICER HAS NOT CORRECTLY APPLIED THE STATUTORY PROVISIONS IN THIS BEHALF. HON'BLE TRIBUNAL HAS ALSO NOWHERE IN ITS ORDER SPELT OUT AS TO WHAT ENQUIRY LD. ASSESSING OFFICER HAS FAILED TO MAKE. 3. THE APPELLANT MOST HUMBLY SUBMITS THAT THE ISSUE BEFORE HON'BLE TRIBUNAL FOR ADJUDICATION WAS WHETHER THE ORDER PASSED BY LD. ASSESSING OFFICER U/S 143(3) OF 29.12.2009 IS ERRONEOUS IN AS MUCH AS WHETHER OR NOT THE ASSESSING OFFICER HAS TAKEN A POSSIBLE 'VIEW ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE OF THE APPELLANT. THE ISSUE BEFORE THE HON'BLE TRIBUNAL WAS NOT AS TO WHAT IS THE CORRECT LEGAL MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 6 INTERPRETATION OF THE RELEVANT PROVISIONS; THE ISSUE WAS AS TO WHETHER OR NOT THE INTERPRETATION RELIED UPON BY ID. ASSESSING OFFICER IS ONE OF THE POSSIBLE VIEWS. 4. HON'BLE TRIBUNAL HAS HELD THAT THE ASSESSING OFFICER HAS PASSED THE ORDER MERELY ACCEPTING THE CLAIM OF THE ASSESSEE WHEREAS THE FACT OF THE MATTER IS THAT ID. ASSESSING OFFICER HAS PASSED A DETAILED SPEAKING ORDER AND MADE ADDITIONS TO THE EXTENT OF RS.153,020,101/-. 5. THE HON'BLE TRIBUNAL HAS OBSERVED AS UNDER: 'THE GENERAL LAW ON THE QUESTION OF REVISIONAL JURISDICTION IS THAT AN ORDER PASSED BY THE ASSESSI NG OFFICER CANNOT BE HELD TO BE ERRONEOUS, IF THE ASSESSING OFFICER HAS FOLLOWED ONE OF THE POSSIBLE VIEWS ON T HE SUBJECT. BUT THIS PRINCIPLE BY AND LARGE APPLIES TO QUESTIONS OF FACT. WHEN IT COMES TO QUESTION OF LAW , THE LAW LAID DOWN BY THE COMPETENT AUTHORITY HAS TO BE INVARIABLY FOLLOWED. IT IS A SETTLED LAW THAT WHEN A COURT DECLARES THE LAW ON A SUBJECT, THE DECLARATION GOES BACK TO THE DATE OF ENACTMENT OF THAT PARTICULAR LAW AS TO STATE THAT THE LAW FROM THE DATE OF ITS ENACTMENT I TSELF WAS I N THE MANNER DECIDED BY THE COURT SUBSEQUENTLY. THEREFORE, THE PRONOUNCED ORDER OF THE SPECIAL BENC H DATES BACK TO THE DATE OF ENACTMENT AND, THEREFORE, THE SUPERIMPOSITION MADE BY THE JUDICIAL PRONOUNCEMENT THE ASSESSMENT ORDER HAS BECOME ERRONEOUS.' THE APPELLANT SUBMITS THAT THE ABOVE OBSERVATIONS OF HON'BLE TRIBUNAL CONSTITUTE MISTAKE APPARENT FROM RECORD. IN THE CASE OF MALABAR INDUSTRIAL CO. LTD. V. CIT, HON'BLE SUPREME COURT HAS REFERRED TO 'ONE OF THE COURSES PERMISSIBLE IN LAW'. HENCE, THE IMPRESSION OF HON'BLE ITAT THAT THERE CANNOT BE MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 7 TWO VIEWS ON A QUESTION OF LAW IS A MISTAKE. UNLESS IT CAN BE SAID THAT THE ASSESSING OFFICER HAS IN THE ASSESSMENT ORDER ADOPTED AN IMPERMISSIBLE COURSE IN LAW THE ASSESSMENT ORDER UNDER CONSIDERATION CANNOT BE SAID TO BE ERRONEOUS. SECONDLY, THE OBSERVATIONS OF HON'BLE ITAT THAT THE SUBSEQUENT DECISION OF SPECIAL BENCH DATES BACK TO THE DATE OF ENACTMENT AND HAS THE EFFECT OF RENDERING THE ASSESSMENT ORDER ERRONEOUS IS CONTRARY TO WELL SETTLED LEGAL POSITION THAT A SUBSEQUENT JUDGEMENT OTHER THAN FROM SUPREME COURT OR JURISDICTIONAL HIGH COURT DOES NOT DATE BACK TO THE DATE OF PASSING OF AN ORDER BY AUTHORITY BELOW OR DOES NOT GIVE RISE TO MISTAKE APPARENT FROM RECORD, AS HELD BY HON'BLE ANDHRA PRADESH HIGH COURT IN THE CASE OF CIT VS. K. VENKATESWARA RAO OF 169 ITR 330 (AP) AND BY HON'BLE SUPREME COURT IN THE CASE OF MEPCO INDUSTRIES LTD. VS. CIT 319 ITR 208 (SC). IT IS SUBMITTED WITH RESPECT THAT HON'BLE IT AT IS NOT A FORMAL SOURCE OF LAW IN THE SENSE A HIGH COURT OR SUPREME COURT IS, HENCE ANY SUBSEQUENT ORDER MADE BY ITAT DOES NOT HAVE ANY RETROSPECTIVE EFFECT ON OTHER ALREADY DECIDED CASES. 6. HON'BLE TRIBUNAL HAS COMMITTED A MISTAKE APPARENT FROM RECORD IN NOT ADJUDICATING UPON THE APPELLANT'S GROUND OF APPEAL NO. 4 BEFORE TRIBUNAL. FOR THIS REASON ALSO THE ORDER OF TRIBUNAL IS REQUIRED TO BE MODIFIED. MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 8 7. WITHOUT PREJUDICE AND WITHOUT CONCEDING AT ANY RATE, EVEN IF HON'BLE TRIBUNAL HAD CORRECTLY HELD THAT THE ASSESSING OFFICER HAS FAILED TO MAKE AN ENQUIRY, FROM THAT IT DOES NOT FOLLOW THAT THE ASSESSING OFFICER WAS NOT ENTITLED TAKE THE VIEW THAT HE TOOK. THE TRIBUNAL SHOULD HAVE THEN RESTORED THE MATTER TO THE ASSESSING OFFICER TO MAKE SPECIFIED ENQUIRY AND BASED THEREUPON TO TAKE A FRESH VIEW. HENCE HON'BLE TRIBUNAL HAS ERRED IN CONFIRMING THE ORDER OF COMMISSIONER OF INCOME TAX THAT THE UNABSORBED DEPRECIATION TO THE EXTENT IT RELATES TO ASSESSMENT YEARS 1996- 97 AND 1998-99 CANNOT BE SET OFF BY THE ASSESSING OFFICER. 8. AS REGARDS, ONE TIME SETTLEMENT WITH IDBI YOUR HONOURS HAVE UPHELD THE RESTORATION OF THE MATTER TO THE ASSESSING OFFICER TO FIND OUT WHETHER THERE IS ANY TAX LIABILITY U/ S 41(1). APPARENTLY, YOU HAVE OVERLOOKED THE DOCUMENTS SUBMITTED BY THE APPLICANT IN THE PAPER BOOK II PAGES 21 TO 26 THAT ESTABLISH THAT WE WERE NEVER ALLOWED ANY DEDUCTION FROM OUR INCOME IN THIS BEHALF IN ANY OF THE PAST ASSESSMENTS AND THEREFORE THE QUESTION OF ANY INCOME U/S 41(1) IN THE ASSESSMENT YEAR2007-08 DOERS NOT ARISE. IT IS SUBMITTED WITH RESPECT THAT NON- CONSIDERATION OF PERTINENT DOCUMENTS PLACED IN THE PAPER-BOOK AND RELIED UPON DURING THE COURSE OF HEARING CONSTITUTES A MISTAKE APPARENT FROM RECORD THAT IS REQUIRED TO BE RECTIFIED U/S 254(2). MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 9 4. IN THE LIGHT OF THE ERRORS POINTED OUT HEREINABOVE THE LEARNED AR OF THE ASSESSEE SUBMITTED THAT HON'BLE TRIBUNAL MAY BE PLEASED TO SUITABLY AMEND THIS ORDER DATED 16.11.2012 IN THE CASE OF THE APPELLANT IN ORDER TO RECTIFY AFORESAID MISTAKES, WHICH ARE APPARENT FROM RECORD. 5. THE DR SUBMITTED THAT THERE IS NO MISTAKE APPARE NT ON RECORD WHICH WARRANTS RECALL OF TRIBUNAL ORDER A ND RELIED ON THE IMPUGNED ORDER OF THE TRIBUNAL. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THE ARGUMENT OF THE AR IS TOTA LLY MISCONCEIVED. THE TRIBUNAL CONSIDERED THE ISSUE IN DISPUTE IN ITS ORDER AND GIVEN CATEGORICAL FINDINGS . NOW, THE ASSESSEE'S COUNSEL WANTS TO RE-ARGUE THE CASE F OR WHICH THE TRIBUNAL HAS NO POWER TO REVIEW ITS OWN O RDER. 7. IT IS WELL SETTLED THAT STATUTORY AUTHORITY CANN OT EXERCISE POWER OF REVIEW UNLESS SUCH POWER IS EXPRE SSLY CONFERRED. THERE IS NO EXPRESS POWER OF REVIEW CON FERRED ON THIS TRIBUNAL. EVEN OTHERWISE, THE SCOPE OF REV IEW DOES NOT EXTENT TO RE-HEARING OF THE CASE ON MERIT. IT IS HELD IN THE CASE OF CIT VS. PEARL WOOLLEN MILLS (33 0 ITR 164): HELD, THAT THE TRIBUNAL COULD NOT READJUDICATE THE MATTER UNDER SECTION 254(2). IT IS WELL SETTLED THAT A STATUTORY AUTHORITY CANNOT EXERCISE POWER OF REVIEW UNLESS SUCH POWER IS EXPRESSLY CONFERRED. THERE WAS NO EXPRESS POWER OF REVIEW CONFERRED ON THE TRIBUNAL. EVEN OTHERWISE, THE SCOPE OF REVIEW DID NOT EXTENT TO REHEARING A CASE ON THE MERITS. NEITHER BY INVOKING INHERENT POWER NOR THE MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 10 PRINCIPLE OF MISTAKE OF COURT NOT PREJUDICING A LITIGANT NOR BY INVOLVING DOCTRINE OF INCIDENTAL POWER, COULD THE TRIBUNAL REVERSE A DECISION ON THE MERITS. THE TRIBUNAL WAS NOT JUSTIFIED IN RECALLING ITS PREVIOUS FINDING RESTORING THE ADDITION, MORE SO WHEN AN APPLICATION FOR THE SAME RELIEF HAD BEEN EARLIER DISMISSED. 8. THE SCOPE AND AMBIT OF APPLICATION OF SECTION 254(2) IS VERY LIMITED. THE SAME IS RESTRICTED TO RECTIFICATION OF MISTAKES APPARENT FROM THE RECORD. WE SHALL FIRST DEAL WITH THE QUESTION OF THE POWER OF THE TRIBUNAL TO RECALL AN ORDER IN ITS ENTIRETY. RECALL ING THE ENTIRE ORDER OBVIOUSLY WOULD MEAN PASSING OF A FRES H ORDER. THAT DOES NOT APPEAR TO BE THE LEGISLATIVE INTENT. THE ORDER PASSED BY THE TRIBUNAL UNDER S. 254(1) IS THE EFFECTIVE ORDER SO FAR AS THE APPEAL IS CONCERNED. ANY ORDER PASSED UNDER S. 254(2) EITHER ALLOWING THE AMENDMENT OR REFUSING TO AMEND GETS MERGED WITH THE ORIGINAL ORDER PASSED. THE ORDER AS AMENDED OR REMAINING UN-AMENDED IS THE EFFECTIVE ORDER FOR ALL PRACTICAL PURPOSES. AN ORDER UNDER S. 254(2) DOES NOT HAVE EXISTENCE DE HORS THE ORDER UNDER S. 254(1). RECALLING OF THE ORDER IS NOT PERMISSIBLE UNDER S. 254(2). RECALLING OF AN ORDER AUTOMATICALLY NECESSITATES RE HEARING AND RE-ADJUDICATION OF THE ENTIRE SUBJECT-MATTER OF APPEAL. THE DISPUTE NO LONGER REMAINS RESTRICTED T O ANY MISTAKE SOUGHT TO BE RECTIFIED. POWER TO RECALL AN ORDER IS PRESCRIBED IN TERMS OF RULE 24 OF THE ITAT RULES , 1963, AND THAT TOO ONLY IN CASE WHERE THE ASSESSEE SHOWS THAT IT HAD A REASONABLE CAUSE FOR BEING ABSENT AT A TIM E WHEN THE APPEAL WAS TAKEN UP AND WAS DECIDED EX-PAR TE. JUDGED IN THE ABOVE BACKGROUND THE ORDER PASSED BY THE TRIBUNAL IS INDEFENSIBLE. MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 11 9. THE WORDS USED IN S. 254(2) ARE SHALL MAKE SUCH AMENDMENT, IF THE MISTAKE IS BROUGHT TO ITS NOTICE . CLEARLY, IF THERE IS A MISTAKE, THEN AN AMENDMENT I S REQUIRED TO BE CARRIED OUT IN THE ORIGINAL ORDER TO CORRECT THAT PARTICULAR MISTAKE. THE PROVISION DOES NOT IN DICATE THAT THE TRIBUNAL CAN RECALL THE ENTIRE ORDER AND P ASS A FRESH DECISION. THAT WOULD AMOUNT TO A REVIEW OF T HE ENTIRE ORDER AND THAT IS NOT PERMISSIBLE UNDER THE IT ACT. THE POWER TO RECTIFY A MISTAKE UNDER S. 254(2) CANN OT BE USED FOR RECALLING THE ENTIRE ORDER. NO POWER OF R EVIEW HAS BEEN GIVEN TO THE TRIBUNAL UNDER THE IT ACT. T HUS, WHAT IT COULD NOT DO DIRECTLY COULD NOT BE ALLOWED TO BE DONE INDIRECTLY. 10. IN THE CASE OF CIT VS. HINDUSTAN COCA COLA BEVERAGES (P) LTD. (2007) 207 CTR (DEL) 119; (2007) 293 ITR 163 (DEL), THEIR LORDSHIPS WHILE CONSIDERIN G THE POWERS OF THE TRIBUNAL UNDER S. 254(2) OF THE IT AC T, 1961 OBSERVED AS UNDER: UNDER S. 254(2) OF THE IT ACT, 1961, THE TRIBUNAL HAS THE POWER TO RECTIFY MISTAKES IN ITS ORDER. HOWEVER, IT IS PLAIN THAT THE POWER TO RECTIFY A MISTAKE IS NOT EQUIVALENT TO A POWER TO REVIEW OR RECALL THE ORDER SOUGHT TO BE RECTIFIED. RECTIFICATION IS A SPECIES OF THE LARGER CONCEPT OF REVIEW. ALTHOUGH IT IS POSSIBLE THAT THE PRE-REQUISITE FOR EXERCISE OF EITHER POWER MAY BE SIMILAR (A MISTAKE APPARENT FROM THE RECORD), BY ITS VERY NATURE THE POWER TO RECTIFY A MISTAKE CANNOT RESULT IN THE RECALL AND REVIEW OF THE ORDER SOUGHT TO BE RECTIFIED. 11. THUS THE SCOPE AND AMBIT OF APPLICATION U/S. 25 4(2) IS AS FOLLOWS: MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 12 (A) FIRSTLY, THE SCOPE AND AMBIT OF APPLICATION OF S. 254(2) OF IT ACT IS RESTRICTED TO RECTIFICATION OF THE MISTAKES APPARENT FROM THE RECORD. (B) SECONDLY, THAT NO PARTY APPEARING BEFORE THE TRIBUNAL SHOULD SUFFER ON ACCOUNT OF ANY MISTAKE COMMITTED BY THE TRIBUNAL AND IF THE PREJUDICE HAS RESULTED TO THE PARTY, WHICH PREJUDICE IS ATTRIBUTABLE TO THE TRIBUNALS MISTAKE/ERROR OR OMISSION, AND WHICH AN ERROR IS A MANIFEST ERROR, THEN THE TRIBUNAL WOULD BE JUSTIFIED IN RECTIFYING ITS MISTAKE. THE RULE OF PRECEDENT IS AN IMPORTANT ASPECT OF LEGAL CERTAINTY IN THE RULE OF LAW AND TH AT PRINCIPLE IS NOT OBLITERATED BY S. 254(2) OF THE AC T AND NON-CONSIDERATION OF PRECEDENT BY THE TRIBUNAL CAUSES A PREJUDICE TO THE ASSESSEE. (C) THIRDLY, POWER TO RECTIFY A MISTAKE IS NOT EQUIVALE NT TO A POWER TO REVIEW OR RECALL THE ORDER SOUGHT TO BE RECTIFIED. (D) FOURTHLY, UNDER S. 254(2) AN OVERSIGHT OF A FACT CANNOT CONSTITUTE AN APPARENT MISTAKE RECTIFIABLE UNDER THE SECTION. (E) FIFTHLY, FAILURE ON THE PART OF THE TRIBUNAL TO CONSIDER AN ARGUMENT ADVANCED BY EITHER PARTY FOR ARRIVING AT A CONCLUSION IS NOT AN ERROR APPARENT O N RECORD, ALTHOUGH IT MAY BE AN ERROR OF JUDGEMENT. (F) SIXTHLY, EVEN IF ON THE BASIS OF A WRONG CONCLUSION THE TRIBUNAL HAS NOT ALLOWED A CLAIM OF THE PARTY I T WILL NOT BE A GROUND FOR MOVING AN APPLICATION UNDER S. 254(2) OF THE ACT. MA NO. 69/ HYD/2013 M/S DHARTI DREDGING & INFRASTRUCTURE. =============================== 13 (G) LASTLY, IN THE GARB OF AN APPLICATION FOR RECTIFICATION UNDER S. 254(2) THE ASSESSEE CANNOT B E PERMITTED TO REOPEN AND REARGUE THE WHOLE MATTER AS THE SAME IS BEYOND THE SCOPE OF S. 254(2) OF THE IT ACT. 12. IN VIEW OF THE ABOVE DISCUSSION, WE FIND NO MER IT IN THE ARGUMENT OF THE ASSESSEE'S COUNSEL. THE TRIBUN AL CANNOT REVIEW ITS OWN ORDER AND THE REMEDY LIES ELSEWHERE. WE DO NOT FIND ANY MISTAKE APPARENT ON RECORD WHICH WARRANTS RECTIFICATION OF TRIBUNAL'S O RDER. ACCORDINGLY, THE MA FILED BY THE ASSESSEE IS DISMIS SED. 13. IN THE RESULT, THE MA FILED BY ASSESSEES IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 23/08/2 013. SSD/- SD/- SD/- ASHA VIJAYARAGHAVAN JUDICIAL MEMBER SD/- CHANDRA POOJARI ACCOUNTANT MEMBER SD/-SD/- HYDERABAD, DATED THE 23 RD AUGUST, 2013 KV COPY TO:- 1) M/S DHARTI DREDGING & INFRASTRUCTURE LTD., 1 ST FLOOR, POINT OF VIEW, B.S. MAKTHA, BEGUMPET, HYDERABAD 500 016. 2) ADDL.CIT, CIRCLE, RANGE 1, HYDERABAD. 3) THE CIT-I, HYDERABAD 4) THE ACIT, CIRCLE 1(2), HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDERABAD.