Case Law Details
RELEVANT PARAGRAPH
8. A bare perusal of the ground raised by the assessee, in impugned M. A. reveals that the same pertain to the issues adjudicated by the Bench, on merit, after evaluating the rival submissions, including case laws relied upon by the parties, and the relevant records. The issues considered and decided on merit after due application of mind by the Bench do not constitute obvious, glaring, patent and self evidence mistake of facts or law, within the meaning of the provisions of section 254(2) of the Act. therefore, the ground raised by the assessee in the impugned miscellaneous applications, patently falls beyond the purview of the section 254(2) of the Act. It is well settled legal proposition that an error of judgment and non-consideration of any argument fall beyond the scope of the mistake apparent from record contemplated under the said section. The issues in these miscellaneous applications have been adjudicated by the Bench after consideration of rival submissions and relevant records. Thus, the submissions of the assessee were duly considered. This proposition finds ample supports from a plethora of decisions, rendered by the Hon’ble Apex Court and various High Courts as discussed herein after.
9. The factual and legal matrix of the present Miscellaneous Applications falls under the ratio of the Jurisdictional High Court, in the case of Ramesh Electric and Trading Co.,203 ITR 497 (Bom). Therefore, applying the ratio of the Jurisdictional High Court, on the subject matter of instant Miscellaneous Applications, it is evident that the case of both the assessees namely Shri Adarshveer P. Jain and Shri Savantarvijay P. Jain are not covered under section 254(2) of the Act. The relevant and operative part of the decision is reproduced here under:-
“Under section 254(2) of the Income-tax Act, 1961, the Appellate Tribunal may, “with a view to rectifying any mistake apparent from the record”, amend any order passed by it under sub-section (1) within the time prescribed therein. It is an accepted position that the Appellate Tribunal does not have any power to review its own orders under the provisions of the Act. The only power which the Tribunal possesses is to rectify any mistake in its own order is apparent from the record. This is merely 2 power of amending its The power of rectification under section 254(2) can be exercised only mistake which is sought to be rectified is an obvious and patent which is apparent from the record, and not a mistake which requires. Established by arguments and a long drawn process of reasoning on points on which there may conceivably be two opinions. Failure of the Tribunal to consider, an argument advanced by either party for arriving at a conclusion is not an error apparent on the record, although it may be an error of judgment. The Tribunal cannot, in the exercise of its power of rectification, look into some other circumstances which would support or not support its conclusion.”
9.1 The issues raised in these miscellaneous applications, in respect of both the assessees, have been adjudicated by the Bench, on merit in its order dated 29/9/2008, and the same are highly debatable and contentious and, hence, do not constitute mistake apparent from record u/s. 254(2) of the Act.
9.2. Further, analysis and discussion, on the Jurisdiction of the Tribunal u/s. 254 of the Act would reveal that these two issues of the above said assessees, raised in the said Miscellaneous Applications, as discussed above, do not fall under the statutory phrase ‘any mistake apparent from record’. The Tribunal does not enjoy jurisdiction u/s. 254(2) of the Act, which are in the nature of review and reversal of its decision, taken on merit after appreciation of legal and factual position of the case. No such powers are conferred by the Income-tax Act, 1961, on any authority, wherein at the convenience and arbitrariness of the authority, the decision already taken on merit can be reversed under the guise of rectification. Such plenary power and jurisdiction fall beyond the purview of section 254(2) of the Act. The issues raised by these assessees, in the impugned Miscellaneous Applications, do not fall under the category of mistake apparent from record, as contemplated under section, 254(2) of the Act. A similar expression ‘error apparent on the face of the record came up for consideration before the Hon’ble Supreme Court, in the case of T. S. Baiaram, ITO Vs. Volkart Brothers (1971) 82 ITR 50 (SC), wherein it was observed: ‘
“An error which has to be established by a long drawn process of reasoning on points where there may conceivably be two opinions can be hardly be said to be an error apparent on the fact of the record. As the above discussion of the rival contentions show the alleged error in the present case is far from self evident .and it can be established, it has to be established by lengthy and complicated arguments. We do not think such an error can be cured by a writ of certiorari according to the rule governing the powers of the superior court to issue such a writ.”
9.3 In view of this, the issues raised by these assessee’s in these Miscellaneous Applications are beyond the scope of section 254(2) of the Act as the issues have been decided on merit.
9.4 The expression “any mistake apparent from record” are identical under section 154 and 254 (2) of the Act, hence, the judicial principles laid down by Supreme-Court or High Courts are applicable to both the statutory situations contemplated under these section. The provisions of section 254(2) of the Act have limited application. The Income-tax Authorities or the Tribunal cannot, reconsider, review or revise their order, as held in the case of CIT vs. Sevugan 16 ITR 59; Arulandam Vs. ITO, 47 ITR 229. Similarly, such authorities cannot reconsider their conclusion, on the facts of the case, or sit in appeal, over the decision, as decided in the case(s) of Sidhramappa Vs. CIT, 21 ITR 333; Parameshweran Vs. ITO 28 ITR 885; CIT Vs. Sundram 52 ITR 744; Khorsheed Vs. CED. 122 ITR 21 (SC).
9.5 The Supreme Court has held in the case of Poothundu Planations Pvt. Ltd..Led. Vs. ITO (1996), 221 ITR 557 that only an apparent error of fact or law can be rectified. If the mistake of law has to be established by construing the words of a section, to find its proper meaning, then such an error cannot normally be a rectifiable error. There has to be a mistake apparent from the record. A look at 3rd must show that there has been an error, and that error may be rectified as held by the Supreme Court in CIT vs. Keshri Metal (P) Ltd. (1999) 155 CTR (SC) 531; (1999) 237 ITR 165 (SC). A decision on the debatable points or issue cannot be construed as mistake apparent from the records. The mistake of fact or law floating on the surface of the record falls within the meaning and ambit of this section. Such a power of rectification u/s. 254(2) of the Act cannot be understood to review, revise or reconsider the substantial decisions, taken on merit after due consideration of law and facts. To recall or revise the decision is beyond the purview of the provisions of this section, as it would jeo pardise the fundamental principle of finality of such order. In view of this, the issues raised by the assessees in the miscellaneous applications discussed above are not covered under section 254(2) of the Income-tax Act, 1961.
10. The issues raised by these assessees, in the impugned Miscellaneous Applications have been dealt with, after appreciation of the factual and legal position of the cases and adjudicated on merit. Therefore, these grounds mentioned, in these Miscellaneous Application, do not fall under the purview of the provisions of section 254(2) of the Act. The provisions of the section contemplate to rectify any mistake apparent from record and non-consideration of any argument advanced by either party for arriving at a conclusion is not an error apparent on record, although it may be an error of judgment and the same cannot be rectified u/s. 254(2) of the Act, as held by the Hon’ble Jurisdictional Higb Court in the case of CIT vs. Ramesh Electric & Trading Co. (1993) 203 ITR 497,502 (Bom). In these two miscellaneous applications there doesn’t exist any legal or factual mistake, apparent from record and the assessee has merely sought to rectify the impugned Tribunal’s order, on the of different view conceived by the assessee, and the Id. CIT(A) in respect of the grounds of the said Miscellaneous Applications. It is further added that these grounds of the impugned Miscellaneous Applications are debatable issues and not. The mistake apparent from record and, hence, are not amenable to rectification jurisdiction conferred on the Tribunal u/s. 254(2) of the Act. It is a settled legal proposition that in the garb of Miscellaneous Application for rectification, the assessee cannot be allowed to re-open the whole matter, which is beyond the scope of section 254(2) of the Act, in the absence of any manifest error, which is obvious, clear and self evident. Thus, the Tribunal is not competent to recall its previous order and re-write the same again and reverse the earlier decision taken on merit. What can be rectified under the said section is a mistake apparent from record and not the mistake which needs elaborate reason or inquiry to establish the same. Similarly, where two opinions are possible, such a situation do not fall under the provisions of section 254(2) of the Act, as held by the Hon’ble Punjab & Haryana HighCourt in the case of CIT vs. Vardhaman Spinnings, 226 ITR 296 (P&H). Thus, it is clear that the power so conferred does not contemplate a re-hearing which would have the effect of re-writing an order, affecting the merits of the case, as sought by the assessees, in the present cases. There is a difference between a power to review and a power to rectify a mistake apparent from record. In a nutshell, the scope of such power of rectification, in exercise of jurisdiction u/s. 254(2) of the Act, clearly contemplates what can be corrected is an apparent mistake from record and not to deal with merits of the ca6e and to recall the order, on the basis of asking a second opinion, on the merit, which is not the scope of such rectification. The scope of section 254(2) is very limited and it is only the apparent error, which can be rectified, and the Tribunal can be held to be justified in rejecting the application for rectification raising a matter relating to the merit of the case and not involving an apparent mistake to be rectified as held in the case of Prakash Chand Mehta vs. CIT, 220 ITR 277 (MP).
