ACIT vs. Saurashtra Kutch SE (Supreme Court)

Where the Tribunal had dismissed the appeal filed by the assessee by holding that it was not entitled to exemption u/s 11 and subsequently, on an application filed by the assessee u/s 254(2), recalled the said order on the ground that it had not considered a judgement of the jurisdictional High Court and that there was a mistake apparent from the record and the question arose whether such recall was justified, HELD, upholding the order of the Tribunal:

(i) A mistake apparent from the record is one that is patent, manifest and self-evident and which does not require elaborate discussion of evidence or argument to establish it;

(ii) The non-consideration of a decision of jurisdictional Court or of the Supreme Court is a “mistake apparent from the record” irrespective of whether such decision was rendered prior or subsequent to the rectification;

(iiii) A judicial decision acts retrospectively because it is not the function of the Court to pronounce a `new rule’ but to maintain and expound the `old one’. Judges do not make law; they only discover or find the correct law. A subsequent decision which alters the earlier one has to be applied retrospectively;

(iv) Rectification of an order stems from the fundamental principle that justice is above all. It is exercised to remove the error and to disturb the finality.

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January 2021