The ITO, Ward-2(1)(1), Surat V. M/s. Rachit Industries Pvt. Ltd., Surat

MA 9/SRT/2022

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 1991 (ITAT-SURAT)
• Duration Of Justice: 4 month(s) 1 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 19-06-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 07-04-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 17-02-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RASESH SHAH
• Keywords: Opportunity of being heard; Period of limitation; Time period of passing order; Condonation of delay
• Section: 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM MA Nos.09 & 10/SRT/2022 [Arising in ITA Nos.3311/AHD/2016 & 2980/AHD/2016] Assessment Year: (2012-13) (Physical Court Hearing) The ITO, Ward-2(1)(1), Surat. Vs. M/s. Rachit Industries Pvt. Ltd., 6508/1, Plot No. / Road No.65/A, Sachin GIDC, Surat-395007. èथायीलेखासं./जीआइआरसं./PAN/GIR No.: AAACT8633M (Appellant) (Respondent) Assessee by : Shri Rasesh Shah, CA Revenue by : Shri Abhishek Gautam, Sr. DR स ु नवाईकȧतारȣख/ Date of Hearing : 08/04/2022 घोषणाकȧतारȣख/Date of Pronouncement : 20/06/2022 आदेश / O R D E R PER DR. A. L. SAINI, AM: These two Miscellaneous Applications filed by the Revenue, by way of MA No.09/SRT/2022 and 10/SRT/2022, which arise out of Tribunal order dated 12.04.2021 in the case of M/s. Rachit Industries Pvt. Ltd. in ITA No. 2980/AHD/2016 and ITA No. 3311/AHD/2016. 2. Since in both the Miscellaneous Applications, the grievance raised by the Revenue are identical and similar, therefore, we have clubbed these two Miscellaneous Applications and a consolidated order is being passed for the sake of convenience and brevity. 3. At the outset, Learned Departmental Representative (ld. DR) for the Revenue stated that both these Miscellaneous Applications, filed by the Department, are time barred for two hundred ninety seven (297) days. The Revenue moved an application for condonation of delay. The contention raised by the Revenue in the petition for condonation of delay is reproduced below: “2. In the case of M/s. Rachit Industries Pvt. Ltd. PAN: AAACT8633 for A.Y. 2012- 13, order in ITA No. 2980/AHD/2016 and ITA No. 3311/AHD/2016, dated Page | 2 MA Nos.09 & 10/SRT/2022 Assessment Year.2012-13 Rachit Industries Pvt . Ltd. 12/04/2021 of the Hon'ble ITAT was received in the office of Pr. CIT-1, Surat on 10.08.2021, i.e. within six months from the end of the month in which the order sought to be amended was passed,. Whereas in this case, there was delay in filling MA application beyond the period eligible to file MA due to covid-19 pandemic and consequent disturbance in the normal functioning of office. 3. Sir, during the period of March, 2021 to June 2021, there was outbreak of second wave of COVID-19 pandemic. Al the Government offices were ordered to work with 50% or less staff. Again from Dec, 21, due to the third eave of Covid-19 pandemic, the normal office function was disturbed on account of roaster system and severe infection among the staff/officers. Considering the grave situation of COVID-19 pandemic and difficulties that were faced by the litigants in filling petitions/applications/suits/appeals, all other proceedings within the period of limitation prescribed under the general law of limitation or under any special laws (both Central and /or State), the Hon'ble Supreme Court of India while deciding Miscellaneous Application MA No.665 of 2021, dated 23.09.2021 and subsequent order dated, 10.01.2022 in MA No. 21 of 2022 arising out of MA No. 665 of 2021 took the cognizance of the serious situation of COVID-19 suits/appeals/all other proceedings within the period of limitation or under any special laws (both Central and /or State). 3. As per the order MA No. 665 of 2021, dated 23.09.2021 and 10.01.2022, of the Hon'ble Supreme Court of India, it was held that “in cases where the limitation would have expired during the period between 15.03.2020 to 28.02.2022, notwithstanding the actual balance period of limitation remaining, all persons shall have a limitation period of 90 days from 01.03.2022. In the event the actual balance period of limitation remaining, with effect from 01.03.2022, is greater than 90 days, that longer period shall apply. Hence, considering the aforesaid order of the Hon'ble Supreme Court of India extending the time limit for filling of appeal, the MA filed by this office in the above referred case in within the time limit. 5. Therefore, considering the prevailing serious situation of COVID-19 and the roaster system followed, to maintain the social distancing norms, there is delay infilling of Miscellaneous Application before your good office. It is there, kindly requested to consider the COVID-19 period and the order MA No. 665 of 2021, dated 23.09.2021 and 01.01.2022, of the Hon'ble Supreme Court of India to condone the delay in filling of MA in this case. Further, the Pr. CIT-1, Surat has accorded his approval for filing petition for condonation of delay in respect of this Miscellaneous Application vide his letter No. SRT/Pr.CIT-1/ITO(HQ)-1/M.A./Cond. Delay/21-22 dated 15.02.2022(copy enclosed). 6. In view of the above, it is requested to kindly condone the delay and admit the MA in the case of the above referred subject, which is enclosed herewith.” 4. Based on the contents of the petition, as noted above, Learned Departmental Representative (Ld. DR) prays the Bench to condone the delay. Page | 3 MA Nos.09 & 10/SRT/2022 Assessment Year.2012-13 Rachit Industries Pvt . Ltd. 5. However, Learned Counsel for the assessee opposed the prayer for condonation of delay and stated that delay should not be condoned. 6. We have heard both the parties, on this preliminary issue. We note that delay was not intentional and the reasons narrated in the petition for condonation of delay are convincing in nature. The serious situation of COVID-19 and the roaster system followed by the Department, to maintain the social distancing norms, there was delay in filling of these Miscellaneous Application. Besides, ld DR also submitted before us to consider the COVID-19 period and the order in MA No. 665 of 2021, dated 23.09.2021 and 01.01.2022, of the Hon'ble Supreme Court of India to condone the delay in filling of MA in this case. Therefore, based on these facts we condone the delay and admit these two Miscellaneous Applications for adjudication. 7. The contention raised by Revenue in these two Miscellaneous Applications are that Tribunal has ignored the detailed findings of the Assessing Officer. The ld. DR contended that Tribunal has erroneously held that merely because the assessee- company has filed the primary evidences such as Bank statements, copy of ITR, PAN, Balance Sheet and Profit and Loss Account, the onus of the assessee is stood discharged. The grievance raised by the Revenue in these Miscellaneous Applications are reproduced below: “(vi) In the instant case, Hon'ble Tribunal appears to have ignored the detailed findings of the AO from the field enquiry/investigations carried out by AO and findings incorporated in assessment order and appellate order of CIT(A). ITAT has erroneously held that merely because the assessee company had filed the primary evidence, the onus on the assessee stood discharged. Tribunal has failed to appreciate the facts discussed in assessment order/CIT(A) appellate order that onus to establish the identity and credit worthiness of the investor company was not discharged. The entire transaction seemed bogus, and lacked credibility Ratios laid down by Apex Court in the cases discussed above (especially in PCIT vs NRA Iron and Steel), has not been followed by the Tribunal. 4. In view of the above, it is found that there is factual error occurred in the order of the Hon'ble ITAT in ITA No.2980/AHD/2016 and ITA No.3311/AHD/2016 dated 12.04.2021 which may please be rectified after considering the above facts.” Page | 4 MA Nos.09 & 10/SRT/2022 Assessment Year.2012-13 Rachit Industries Pvt . Ltd. 8. On the other hand, Learned Counsel for the assessee submits that there is no mistake apparent from record, the Tribunal has adjudicated the issue on merits, therefore, order of the Tribunal should not be recalled. 9. We have heard both the parties and note that Tribunal has recorded the findings of the Assessing Officer in Para nos. 6 and 7 of the its order. The Tribunal has recorded the arguments made by the Ld. DR for the Revenue in Para No. 9 of its order. Then after, Tribunal has adjudicated the issue involved on merits vide Para Nos. 11 to 27 of its order. Thus, the adjudication done by the Tribunal, on merits, considering both sides arguments cannot be rectified. The review of order is not permitted, only mistake apparent from record may be rectified. 10. Taking into account, the above noted facts, now, the question before us is that whether in this scenario the Tribunal order dated 12.04.2021 contained a mistake apparent which can be rectified under section 254(2) of the Act? Before we proceed to adjudicate this issue, let us first consult the provisions of section 254(2) of the Act, which reads as follows: “Orders of Appellate Tribunal. “254. (2) The Appellate Tribunal may, at any time within [six months from the end of the month in which the order was passed], with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub-section (1), and shall make such amendment if the mistake is brought to its notice by the assessee or the [Assessing] Officer. Provided that an amendment which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this sub-section unless the Appellate Tribunal has given notice to the assessee of its intention to do so and has allowed the assessee a reasonable opportunity of being heard : [Provided further that any application filed by the assessee in this sub-section on or after the 1st day of October, 1998, shall be accompanied by a fee of fifty rupees.]” Having gone through sub-section 2 of section 254 of the Act, as noted above, we observed that “any mistake apparent from the record” can be rectified. Page | 5 MA Nos.09 & 10/SRT/2022 Assessment Year.2012-13 Rachit Industries Pvt . Ltd. 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. Thus, section 254(2) of the Act does not cover any mistake which may be discovered by a complicated process of investigation, argument or proof. Therefore, amendment of an order under section 254(2) of the Act, does not mean entire obliteration of order originally passed by the Tribunal and its substitution by a new order of Tribunal, this is not permissible under section 254(2) of the Act. Power to rectify an order, under section 254(2) of the Act is extremely limited and it does not extend to correcting errors of law, or re-appreciating factual findings. Thus, it is abundantly clear that there is no mistake apparent from record; hence we dismiss both the Miscellaneous Applications. 11. In the result, both Miscellaneous Applications filed by the Revenue are dismissed. Registry is directed to place one copy of this order in all appeals folder / case file(s). Order is pronounced in the open court on 20/06/2022 by placing the result on the Notice Board as per Rule 34(5) of the Income Tax (Appellate Tribunal) Rule 1963. Sd/- Sd/- (PAWAN SINGH) (Dr. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER lwjr /Surat Ǒदनांक/ Date: 20/06/2022 SAMANTA Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. Pr.CIT 5. DR/AR, ITAT, Surat 6. Guard File By Order // TRUE COPY // Assistant Registrar/Sr. PS/PS ITAT, Surat