Pennar Aqua Exports Pvt. Ltd., Hyderabad V. ACIT, Circle-16(3), Hyderabad

MA 83/HYD/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0825 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-09-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 1994-1995
• Appeal Filed On: 13-03-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PHANI RAJU
• Assessee Lawyers: S RAMA RAO
• Keywords: Income from undisclosed sources; Reasonable cause; Corroborative evidences
• Section: 234B; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER MA NO. 83/HYD/2013 ITA NO. 1846/HYD/2011 ASSESSMENT YEAR 1994-95 M/S. PENNAR AQUA EXPORTS PVT. LTD., HYDERABAD PAN: AABCP3821G VS. THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-16(3), HYDERABAD APPELLANT RESPONDENT APPELLANT BY: SRI S. RAMA RAO RESPONDENT BY: SRI PHANI RAJU DATE OF HEARING: 20.09.2013 DATE OF PRONOUNCEMENT: 25.09.2013 O R D E R PER CHANDRA POOJARI, AM: THIS IS THE MISCELLANEOUS APPLICATION (MA) FILED B Y THE ASSESSEE SEEKING RECTIFICATION IN THE ORDER OF THE TRIBUNAL DATED 20.12.2012 IN ITA NO. 1846/HYD/2011 FOR ASSESSM ENT YEAR 1994-95. 2. THE LEARNED AR SUBMITTED THAT THE DEPARTMENT CAME I N APPEAL BEFORE THIS TRIBUNAL IN THE ABOVE CASE WHERE IN THE DEPARTMENT RAISED THE FOLLOWING GROUNDS OF APPEAL: 1) THE ORDER OF THE ASSESSING OFFICER IS ERRONEOUS, UNJUST AND CONTRARY TO THE FACTS OF THE CASE. 2) THE ASSESSING OFFICER ERRED IN DISBELIEVING THE SHARE CAPITAL INTRODUCED BY THE 23 SHAREHOLDERS AMOUNTING TO RS. 38,40,000. 3) THE ASSESSING OFFICER OUGHT TO HAVE CONSIDERED THE FACT THAT ALL THE SHAREHOLDERS HAVE FILED LETTERS OF CONFIRMATION AND STATED THE FACTS CONCERNING THEIR CAPABILITY TO INVEST. MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 2 4) THE ASSESSING OFFICER OUGHT TO HAVE ACCEPTED THE INVESTMENT MADE BY THEM AND THE COMPANY DID NOT DERIVE ANY INCOME AND HAS NO SOURCE OF INCOME DURING THE RELEVANT PREVIOUS YEAR. 5) THE ASSESSING OFFICER ERRED IN CHARGING INTEREST UNDER SECTION 234A OF RS. 16,33,920 AND U/S. 234B OF RS. 30,69,120. 6) ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF HEARING. 3. FURTHER HE SUBMITTED THAT THE CIT(A) HAD GIVEN RELI EF BY PLACING RELIANCE ON THE JUDGEMENT OF SUPREME COURT IN THE CASE OF CIT VS. BHARAT ENGINEERING & CONSTRUCTION C O. (83 ITR 187) BY OBSERVING THAT THE BUSINESS OF THE ASSESSEE HAS NOT COMMENCED BEFORE ISSUE OF SHARE CAPITAL AND HENCE T HERE WAS NO OCCASION TO EARN UNACCOUNTED INCOME AND INTRODUC TION IN THE FORM AS SHARE CAPITAL. THE CIT(A) NOT EXPRESSE D ANY OPINION ON SHORTCOMING OF ENQUIRY ON THE PART OF TH E ASSESSING OFFICER. HOWEVER, THE TRIBUNAL WHILE DEC IDING THE APPEAL OF THE REVENUE REVERSED THE FINDINGS OF THE CIT(A) OBSERVING THAT THE JUDGEMENT RELIED ON BY THE CIT(A ) IS NOT RELEVANT BY HOLDING AS FOLLOWS: I) THE DECISION WAS RENDERED UNDER INDIAN INCOME TAX ACT, 1922. II) IN THAT CASE, LARGE AMOUNT OF CASH APPEARING ON THE VERY FIRST DAY OF THE ACCOUNTING YEAR WAS HELD TO BE NOT ASSESSABLE AS IT WAS NOT POSSIBLE FOR THE ASSESSEE TO MAKE SUCH A HUGE INCOME ON THE VERY SAME DAY ON WHICH THE ASSESSEE STARTED ITS BUSINESS FOR THE YEAR. III) WHEREAS, U/S. 68 OF THE INCOME-TAX ACT, 1961 EVEN IN A CASE WHERE AN AMOUNT IS CREDITED ON THE VERY FIRST DAY OF THE ACCOUNTING YEAR, SUCH AMOUNT MAY BE ASSESSED AS INCOME OF THE ASSESSEE. MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 3 4. FURTHER HE SUBMITTED THAT THE ABOVE OBSERVATIONS OF THE TRIBUNAL ARE CONTRARY TO THE FACTS IN THAT CASE AND ALSO THE PROVISIONS OF THE INCOME TAX ACT. FIRSTLY , THE FACTS IN THE CASE OF CIT V. BHARAT ENGINEERING CO., ARE THAT IT COMMENCED BUSINESS IN MAY, 1943. IN THEIR ACCOUNT BOOKS, THERE ARE SEVERAL CASH CREDIT ENTRIE S IN THE FIRST YEAR OF ITS BUSINESS. THE DISPUTED CREDIT S WERE ONLY FIVE OF THOSE CASH CREDIT ENTRIES. ON 1 ST JUNE, 1943, THERE IS A CASH CREDIT ENTRY OF RS. 1,00,000. ON 6 TH JULY, 1943, THERE IS A CASH CREDIT ENTRY OF RS. 50,000. O N 30 TH AUG., 1943, THERE IS A CASH CREDIT ENTRY OF RS. 50, 000. ON 2ND DEC., 1943, THERE IS A CASH CREDIT ENTRY OF RS. 15,000 AND ON 15 TH MARCH, 1944, THERE IS A CASH CREDIT ENTRY OF RS. 35,000. THESE CASH CREDIT ENTRIES TOTA L UP TO RS. 2,50,000. THE ITO CALLED UPON THE ASSESSEE T O EXPLAIN THOSE CASH CREDIT ENTRIES. THE EXPLANATION GIVEN BY THE ASSESSEE WAS FOUND TO BE FALSE BY THE ITO, THE AAC AND THE TRIBUNAL. BUT, ALL THE SAME, THE TRIBUNAL FELT THAT THESE CASH CREDIT ENTRIES COULD NOT REPRESENT THE INCOME OR PROFITS OF THE ASSESSEE- COMPANY AS THEY WERE ALL MADE VERY SOON AFTER THE COMPANY COMMENCED ITS ACTIVITIES. THUS, IT IS FACTU ALLY INCORRECT TO SAY THAT THE DISPUTE IN THIS CASE WAS WITH REGARD TO LARGE AMOUNT OF CASH APPEARING ON THE FIR ST DAY OF THE ACCOUNTING YEAR. SECONDLY, THOUGH THERE WERE NO SEPARATE PROVISIONS IN INDIAN INCOME TAX AC T, 1922 CORRESPONDING TO S. 68 OF THE INCOME TAX ACT, 1961, YET IT WAS LAID DOWN IN SEVERAL DECISIONS ON THE BASIS OF GENERAL PRINCIPLES THAT CASH CREDITS WHICH WERE NOT SATISFACTORILY EXPLAINED COULD BE TREATED AS IN COME OF THE ASSESSEE. THEREFORE, IT IS CONTRARY TO THE L AW TO SAY THAT PROVISIONS OF S. 68 DEAL WITH CASH CREDITS IN A MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 4 MANNER DIFFERENT FROM THAT OF THE INDIAN INCOME TAX ACT, 1922. 5. THE AR SUBMITTED THAT EVEN UNDER THE PROVISIONS OF INCOME TAX ACT, 1961 IT WAS HELD BY VARIOUS COUR TS THAT CASH CREDITED ON THE FIRST DAY OF THE ACCOUNTI NG YEAR CANNOT BE TREATED AS INCOME OF THE ASSESSEE. I N INDIA RICE MILLS VS. CIT (218 ITR 508) (ALL.) IT WA S HELD THAT 'THE TRIBUNAL SHOULD HAVE TAKEN NOTE OF THE FA CT THAT ALL THE DEPOSITS AGGREGATING TO RS. 1,43,000 REPRESENTED THE CAPITAL CONTRIBUTION OF THE PARTNER S IN THE FIRM AND THEY WERE MADE BEFORE THE FIRM STARTED ITS BUSINESS. IT WAS FOR THE PARTNERS TO EXPLAIN THE SO URCE OF THE DEPOSITS AND IF THEY FAILED TO DISCHARGE THE ONUS, THEN SUCH DEPOSITS COULD BE ADDED IN THE HANDS OF T HE PARTNERS ONLY. THE TRIBUNAL ERRONEOUSLY CAME TO THE CONCLUSION THAT THE DEPOSITS REPRESENTED THE UNDISCLOSED INCOME OF THE ASSESSEE-FIRM. THE APPROA CH OF THE CIT(A) IN THIS CASE SEEMS TO BE CORRECT WHO CLEARLY HELD THAT UNEXPLAINED DEPOSITS IN NO CASE, COULD BE THE INCOME OF THE ASSESSEE-FIRM BECAUSE THE FIRM STARTED ITS BUSINESS ONLY AFTER THE CREDITS HAD BEE N MADE IN ITS BOOKS.' THEREFORE, IT IS CONTRARY TO LA W TO SAY THAT THE PROVISIONS OF S. 68 OF THE INCOME TAX ACT, 1961 PROVIDE FOR DEEMING THE CASH CREDIT AS INCOME OF THE ASSESSEE EVEN IN A YEAR WHEN THE BUSINESS ITSEL F WAS NOT COMMENCED. 6. THE AR SUBMITTED THAT IN PARA 10 OF THE ORDER DATED 20 TH DECEMBER, 2012 THE TRIBUNAL OBSERVED THAT, IN SPITE OF OPPORTUNITIES GIVEN, THE ASSESSEE HAVIN G FAILED TO PROVE THE GENUINENESS AND CREDITWORTHINES S OF THE PARTIES, THE ADDITION IS TO BE SUSTAINED. THE A BOVE MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 5 OBSERVATION OF THE TRIBUNAL IS CONTRARY TO THE FACT S ON RECORD. DURING THE COURSE OF ASSESSMENT PROCEEDINGS TAKEN UP PURSUANT TO THE ORDER OF THE TRIBUNAL, THE PETITIONER FILED AFFIDAVITS FROM 11 SHARE APPLICANT S (FOR RS. 21,30,000) AND FOR THE BALANCE RS. 17,30,000 THE MATTER WAS SET ASIDE BY THE TRIBUNAL TO ENABLE THE ASSESSING OFFICER TO EXAMINE THE SHARE APPLICATIONS FILED BY THE ASSESSEE BEFORE THE CIT(A). HOWEVER, T HE ASSESSING OFFICER DID NOT MAKE ANY ENQUIRIES IN THI S REGARD. THEREFORE, IT IS FACTUALLY INCORRECT TO SAY THAT THE PETITIONER DID NOT AVAIL THE OPPORTUNITY TO PRO VE THE GENUINENESS OF THE CASH CREDITS. THE PETITIONER FILED THE AFFIDAVITS AND THESE WERE SIMPLY BRUSHED ASIDE BY THE ASSESSING OFFICER WITHOUT MAKING ANY ENQUIRY WHATSOEVER. 7. THE AR SUBMITTED THAT PROBABLY DUE TO INADVERTENCE, THE TRIBUNAL OBSERVED THAT THE PETITI ONER DID NOT AVAIL THE OPPORTUNITY TO EXPLAIN THE GENUINENESS OF THE CASH CREDITS. THE ABOVE ERRORS T HAT CREPT INTO THE ORDER OF THE TRIBUNAL HAVE A SERIOUS BEARING ON THE DECISION RENDERED BY THE TRIBUNAL. H AD THESE ERRORS NOT CREPT IN TO THE ORDER, THE DECISIO N WOULD HAVE BEEN DIFFERENT. 8. THE AR PRAYED THAT, IN THE LIGHT OF THE ABOVE, SUBMISSIONS, THE TRIBUNAL MAY MAKE SUITABLE MODIFICATIONS TO THE ORDER DATED 20 TH DECEMBER, 2012 BY REMOVING THE ABOVE MENTIONED ERRORS. IN THE ALTERNATIVE, HE PRAYED THAT THE TRIBUNAL MAY RECALL ITS ORDER DATED 20 TH DECEMBER, 2012 AND HEAR THE APPEAL AFRESH. MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 6 9. ON THE OTHER HAND, THE LEARNED DR SUBMITTED THAT TH ERE IS NO MISTAKE APPARENT IN THE ORDER OF THE TRIBUNAL . THE TRIBUNAL HAD CONSIDERED ENTIRE FACTS AND CIRCUMSTAN CES OF THE CASE AND HAD GIVEN FINDING. HE RELIED ON HOMI MEHTA & SONS (P) LTD. V. DCIT (63 ITD 15) (MUM), DHARAMCHAN D SURANA V. ITO (61 ITD 115) (MAD) (TM), CIT VS. RAMESH ELEC TRIC AND TRADING CO. (203 ITR 497) (BOM). 10. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. IN THE PRESENT CASE, THE CIT(A ) ALLOWED APPEAL OF THE ASSESSEE BY OBSERVING THAT THE BUSINE SS OF THE ASSESSEE HAD NOT YET BEEN COMMENCED, THERE WOULD NO T BE ANY OCCASION FOR THE COMPANY TO EARN UNACCOUNTED IN COME AND INTRODUCE IT IN THE FIRM AS SHARE CAPITAL AND D ELETED THE ADDITION BY PLACING RELIANCE ON VARIOUS DECISIONS M ORE SPECIFICALLY ON THE JUDGEMENT OF SUPREME COURT IN T HE CASE OF CIT VS. BHARAT ENGINEERING & CONSTRUCTION COMPANY ( CITED SUPRA). HOWEVER, THE TRIBUNAL CONSIDERING THE ENTI RE FACTS AND CIRCUMSTANCES OF THE CASE VACATED THE FINDINGS OF THE CIT(A) ON THIS ISSUE WHEN THE JUDGEMENT RELIED ON B Y THE CIT(A) IS DISTINGUISHABLE. THE TRIBUNAL ALSO CONSI DERED THE FACT THAT THE ASSESSEE HAS NOT DISPENSED THE BURDEN CAST UPON IT WITH REFERENCE TO THE GENUINENESS OF THE TRANSAC TION AND CREDITWORTHINESS OF THE PARTIES. THE LEARNED AR BE FORE US SUBMITTED THAT AN AMOUNT OF RS. 38.40 LAKHS WHICH REPRESENTS ADDITION MADE U/S. 68 OF THE ACT CONSISTS TWO PARTS FIRST PART CONCERNS TO 12 PARTIES AMOUNTING TO RS. 17.10 LAKHS WHEREIN THE ASSESSEE HAD NOT FURNISHED CONFIRMATION LETTERS; THE SECOND PART IS CONCERNED TO 11 PARTIES AMOUNTING TO RS. 21.30 LAKHS IN RESPECT OF WHICH AFFIDAVITS WERE FILED. BEING SO, BOTH THE ABOVE CA NNOT BE CONCLUDED AS SAME AND TO BE CONSIDERED DIFFERENT. HOWEVER, WE FIND THAT THOUGH THE ASSESSEE FILED AFFIDAVITS F OR 11 MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 7 PARTIES, THERE WAS NO SUPPORTING EVIDENCE TO SHOW T HE AGRICULTURAL HOLDINGS OF THE ABOVE PARTIES, THE CAP ACITY TO LAND THE MONEY BY THESE 11 PARTIES IS NOT PROVED BY THE ASSESSEE. EXCEPT THE AFFIDAVITS, THERE IS NO SUPPO RTING MATERIAL. BEING SO, THE TRIBUNAL CONCURRED WITH TH E VIEW OF THE ASSESSING OFFICER. IN RESPECT OF 12 PARTIES FO R AN AMOUNT OF RS. 17.10 THERE ARE NO CONFIRMATION LETTERS. BE ING SO, THE TRIBUNAL ALSO CONFIRMED THE ORDER OF THE ASSESSING OFFICER ON THIS ISSUE. NOW THE AR SUBMITS THAT THE ORDER OF T HE TRIBUNAL SUFFERS FROM MISTAKE. 11. CONSIDERATION OF THE PRESENT ARGUMENTS OF THE AR AMOUNTS TO REVIEW OF OUR EARLIER ORDER. IT IS WELL SETTLED THAT STATUTORY AUTHORITY CANNOT EXERCISE POWER OF REVIEW UNLESS SUCH POWER IS EXPRESSLY CONFERRED. THERE IS NO EX PRESS POWER OF REVIEW CONFERRED ON THIS TRIBUNAL. EVEN O THERWISE, THE SCOPE OF REVIEW DOES NOT EXTENT TO RE-HEARING O F THE CASE ON MERIT. IT IS HELD IN THE CASE OF CIT VS. PEARL WOOLLEN MILLS (330 ITR 164): HELD, THAT THE TRIBUNAL COULD NOT READJUDICATE THE MATTER UNDER SECTION 254(2). IT IS WELL SETTLE D 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 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. 12. THE SCOPE AND AMBIT OF APPLICATION OF SECTION 254(2 ) IS VERY LIMITED. THE SAME IS RESTRICTED TO RECTIFICAT ION OF MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 8 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. RECALLING THE ENTIRE ORDER OBVIOUSLY WOULD MEAN PASSING OF A FRESH ORDER. THAT DOES NOT APPEAR TO BE THE LEGISLATIVE INTENT. THE ORDER PASSED BY THE TRIBUN AL UNDER S. 254(1) IS THE EFFECTIVE ORDER SO FAR AS THE APPEAL IS CONCERNED. ANY ORDER PASSED UNDER S. 254(2) EITHER ALLOWING TH E AMENDMENT OR REFUSING TO AMEND GETS MERGED WITH THE ORIGINAL ORDER PASSED. THE ORDER AS AMENDED OR REM AINING 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 N OT PERMISSIBLE UNDER S. 254(2). RECALLING OF AN ORDER AUTOMATICALLY NECESSITATES REHEARING AND RE-ADJUDIC ATION OF THE ENTIRE SUBJECT-MATTER OF APPEAL. THE DISPUTE N O LONGER REMAINS RESTRICTED TO ANY MISTAKE SOUGHT TO BE RECT IFIED. POWER TO RECALL AN ORDER IS PRESCRIBED IN TERMS OF RULE 24 OF THE ITAT RULES, 1963, AND THAT TOO ONLY IN CASE WHE RE THE ASSESSEE SHOWS THAT IT HAD A REASONABLE CAUSE FOR B EING ABSENT AT A TIME WHEN THE APPEAL WAS TAKEN UP AND W AS DECIDED EX-PARTE. JUDGED IN THE ABOVE BACKGROUND T HE ORDER PASSED BY THE TRIBUNAL IS INDEFENSIBLE. 13. 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 IS REQUIRE D TO BE CARRIED OUT IN THE ORIGINAL ORDER TO CORRECT THAT P ARTICULAR MISTAKE. THE PROVISION DOES NOT INDICATE THAT THE TRIBUNAL CAN RECALL THE ENTIRE ORDER AND PASS A FRESH DECISI ON. THAT WOULD AMOUNT TO A REVIEW OF THE ENTIRE ORDER AND TH AT IS NOT PERMISSIBLE UNDER THE IT ACT. THE POWER TO RECTIFY A MISTAKE UNDER S. 254(2) CANNOT BE USED FOR RECALLING THE EN TIRE ORDER. NO POWER OF REVIEW HAS BEEN GIVEN TO THE TRIBUNAL U NDER THE MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 9 IT ACT. THUS, WHAT IT COULD NOT DO DIRECTLY COULD NOT BE ALLOWED TO BE DONE INDIRECTLY. 14. IN THE CASE OF CIT VS. HINDUSTAN COCA COLA BEVERAGE S (P) LTD. (2007) 207 CTR (DEL) 119; (2007) 293 ITR 163 ( DEL), THEIR LORDSHIPS WHILE CONSIDERING THE POWERS OF THE TRIBU NAL UNDER S. 254(2) OF THE IT ACT, 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. 15. THUS THE SCOPE AND AMBIT OF APPLICATION U/S. 254(2) IS AS FOLLOWS: (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 ATTRIBUTA BLE TO THE TRIBUNALS MISTAKE/ERROR OR OMISSION, AND WHICH AN ERROR IS A MANIFEST ERROR, THEN THE TRIBUN AL WOULD BE JUSTIFIED IN RECTIFYING ITS MISTAKE. THE RULE OF PRECEDENT IS AN IMPORTANT ASPECT OF LEGAL CERTAINTY IN THE RULE OF LAW AND THAT PRINCIPLE IS NOT OBLITERATED BY S. 254(2) OF THE ACT AND NON- MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 10 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. (G) LASTLY, IN THE GARB OF AN APPLICATION FOR RECTIFICA TION UNDER S. 254(2) THE ASSESSEE CANNOT BE PERMITTED TO REOPEN AND REARGUE THE WHOLE MATTER AS THE SAME IS BEYOND THE SCOPE OF S. 254(2) OF THE IT ACT. 16. FURTHER, IN THE CASE OF CIT VS. KARAM CHAND THAPAR & BROS. PVT. LTD. (176 ITR 535) (SC) WHEREIN HELD THA T THE DECISION OF THE TRIBUNAL HAS NOT TO BE SCRUTINISED SENTENCE BY SENTENCE MERELY TO FIND OUT WHETHER ALL FACTS HAVE BEEN SET OUT IN DETAIL BY THE TRIBUNAL OR WHETHER SOME INCID ENTAL FACT WHICH APPEARS ON THE RECORD HAS NOT BEEN NOTICED BY THE TRIBUNAL IN ITS JUDGMENT. IF THE COURT, ON A FAIR R EADING OF THE JUDGMENT OF THE TRIBUNAL, FINDS THAT IT HAS TAKEN I NTO ACCOUNT ALL RELEVANT MATERIAL AND HAS NOT TAKEN INTO ACCOUN T ANY IRRELEVANT MATERIAL IN BASING ITS CONCLUSIONS, THE DECISION OF MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 11 THE TRIBUNAL IS NOT LIABLE TO BE INTERFERED WITH, U NLESS, OF COURSE, THE CONCLUSIONS ARRIVED AT BY THE TRIBUNAL ARE PERVERSE. IT IS NOT NECESSARY FOR THE TRIBUNAL T O STATE IN ITS JUDGEMENT SPECIFICALLY OR IN EXPRESS WORDS THAT IT HAS TAKEN INTO ACCOUNT THE CUMULATIVE EFFECT OF THE CIRCUMSTA NCES OR HAS CONSIDERED THE TOTALITY OF THE FACTS, AS IF THA T WERE A MAGIC FORMULA; IF THE JUDGEMENT OF THE TRIBUNAL SHO WS THAT IT HAS, IN FACT, DONE SO, THERE IS NO REASON TO INTERF ERE WITH THE DECISION OF THE TRIBUNAL. 17. IN THE INSTANT CASE, THE TRIBUNAL WHILE DECIDING TH E APPEAL OF THE ASSESSEE VIDE ORDER DATED 20 TH DECEMBER, 2012 CONSIDERED THE ELABORATE ARGUMENTS ADVANCED BY THE AUTHORISED REPRESENTATIVES OF BOTH THE PARTIES. IT IS ALWAYS THE ENDEAVOUR OF THE TRIBUNAL THAT WHILE PASSING TH E ORDER IT CONSIDERS ALL THE ARGUMENTS OF THE PARTIES. NOW RE VERTING TO THE ORDER PASSED BY THE TRIBUNAL DATED 20 TH DECEMBER, 2012 ALONG WITH THE ARGUMENTS OF THE ASSESSEE FOR THE PR ESENT MISCELLANEOUS APPLICATION UNDER CONSIDERATION, WE F IND THAT THE TRIBUNAL HAS REPRODUCED AND CONSIDERED THE CASE -LAW SUBMITTED BY THE ASSESSEE IN ITS ARGUMENTS TO SUPPO RT THE CONTENTION. NOW THE ASSESSEES CONTENTION RAISED IN THE MISCELLANEOUS APPLICATION IS THAT THE ARGUMENT BY T HE AR IN SUPPORT OF ITS CONTENTION HAS NOT BEEN CONSIDERED B Y THE TRIBUNAL WHILE PASSING THE ORDER AND ALSO REASON FO R NOT CONSIDERATION IS ALSO NOT GIVEN BY THE TRIBUNAL WHI LE PASSING THE ORDER, HENCE, THERE IS MISTAKE APPARENT IN THE ORDER OF THE TRIBUNAL WHICH CALLS FOR RECTIFICATION. 18. IN THIS REGARD, WE WOULD LIKE TO MENTION THAT IN TH E ORDER, THE TRIBUNAL FIRST METICULOUSLY MENTIONED TH E ARGUMENTS OF THE LEARNED AR FOR THE ASSESSEE, THE P OINTS RAISED BY HIM THEN THE RELEVANT CASE-LAWS RELIED UP ON BY THE MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 12 AR OF THE ASSESSEE. THEREAFTER, THE TRIBUNAL CONSI DERED THE SAME AND PASSED A SPEAKING ORDER FOR NOT ENTERTAINI NG THE CLAIM OF THE ASSESSEE. WHILE REJECTING THE CLAIM O F THE ASSESSEE THE TRIBUNAL DISTINGUISHED THE JUDGEMENT O F SUPREME COURT IN THE CASE OF BHARAT ENGINEERING & CONSTRUCTION CO. (CITED SUPRA). THUS, IN VIEW OF O UR DETAILED DISCUSSION, WE CONCLUDED THAT THE TRIBUNAL IS JUSTI FIED IN REJECTING THE GROUNDS TAKEN BY THE ASSESSEE . 19. FURTHER FROM THE ORDER OF THE TRIBUNAL DATED 20 TH DECEMBER, 2012, IT IS EVIDENT THAT THE TRIBUNAL CON SIDERED THE ARGUMENTS OF THE ASSESSEES COUNSEL AS WELL AS THE RATIO OF THE DECISIONS OF THE SUPREME COURT ELABORATELY DISC USSING THE SAME IN THE ORDER. HENCE, IT CANNOT BE SAID THAT T HE TRIBUNAL HAS NOT CONSIDERED THE CASE-LAW CITED BY THE LEARNE D AR FOR THE ASSESSEE AS ALLEGED IN THE MISCELLANEOUS APPLIC ATION. ON THE CONTRARY, THE TRIBUNAL IN THE ORDER, AFTER TAKI NG NOTE OF THE CASE-LAW RELIED UPON BY THE LEARNED AR FOR THE ASSESSEE, GAVE REASONING WHY IT WAS NOT RELEVANT TO CONSIDER THE SAME. THE AVERMENT OF THE ASSESSEE IS THAT THE DECISION O F THE APEX COURT RELIED ON BY HIM HAS NOT BEEN APPLIED BY THE TRIBUNAL WHILE COMING TO THE CONCLUSION IN THE TRIBUNAL ORDE R, IS NOT A MISTAKE APPARENT ON RECORD FALLING WITHIN THE SCOPE OF SECTION 254(2) OF THE IT ACT IN VIEW OF OUR DISCUSS ION HEREINABOVE IN THIS ORDER AS RECONSIDERING THE SAME WOULD AMOUNT TO RECALLING AND REVIEWING THE ORDER AND PAS SING A FRESH ORDER AFTER RECONSIDERING THE ELABORATE ARGUM ENTS ADVANCED BY THE PARTIES. 20. FURTHER THE TRIBUNAL CONSIDERED THE ENTIRE FACTS AN D CIRCUMSTANCES OF THE CASE AND DECIDED THE ISSUE. BEING SO, NOW WE CANNOT REVIEW THE SAME ON THE BASIS OF FRESH ARGUMENTS ADVANCED BY THE LEARNED AR. MA NO. 83/HYD/2013 M/S. PENNAR AQUA EXPORTS PVT. LTD. =========================== 13 21. WE MAY MENTION HEREIN THAT WE MIGHT HAVE COMMITTED AN ERROR OF JUDGEMENT IN WRONGLY APPLYING/INTERPRETI NG THE JUDGEMENT OF THE SUPREME COURT AS MENTIONED ON THE MATTER, BUT THE ASSESSEE IS FREE TO EXPLORE THE REMEDY AVAI LABLE UNDER THE LAW. 22. IN THE RESULT, THE MA FILED BY THE ASSESSEE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH SEPTEMBER, 2013 SD/- (SAKTIJIT DEY) JUDICIAL MEMBER SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER HYDERABAD, DATED 25 TH SEPTEMBER, 2013 TPRAO COPY FORWARDED TO: 1. M/S. PENNAR AQUA EXPORTS PVT. LTD., PLOT NO. 171, 3RD FLOOR, ROAD NO. 8, DHANALAXMI COLONY, MAHENDRA HILL S, EAST MAREDPALLY, HYDERABAD. 2. THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-16( 3), 6 TH FLOOR, AAYAKAR BHAVAN, BASHEERBAGH, HYDERABAD-4. 3. THE COMMISSIONER OF INCOME-TAX (APPEALS)-V, HYDERABAD. 4. THE COMMISSIONER OF INCOME-TAX-IV, HYDERABAD. 5. THE DR B BENCH, ITAT, HYDERABAD.