Shri Vijayakumar Gauhar, CHENNAI v. ACIT, CHENNAI

MA 128/CHNY/2010 | 2001-2002
Pronouncement Date: 30-07-2010 | Result: Dismissed

Appeal Details

RSA Number 12821724 RSA 2010
Assessee PAN AADPG3022B
Bench Chennai
Appeal Number MA 128/CHNY/2010
Duration Of Justice 1 month(s) 5 day(s)
Appellant Shri Vijayakumar Gauhar, CHENNAI
Respondent ACIT, CHENNAI
Appeal Type Miscellaneous Application
Pronouncement Date 30-07-2010
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 30-07-2010
Date Of Final Hearing 30-07-2010
Next Hearing Date 30-07-2010
Assessment Year 2001-2002
Appeal Filed On 25-06-2010
Judgment Text
IN THE INCOME-TAX APPELLATE TRIBUNAL: D- BENCH : CHENNAI (BEFORE SHRI ABRAHAM P GEORGE & SH RI GEORGE MATHAN) M.A NO. 128/MDS/2010 IN ITA NO.1404/MDS/09 & CO NO.165/MDS/09 ASSESSMENT YEAR 2001-02 SHRI VIJAYKUMAR GAUHAR VS. THE ACIT 273 VIJAYBHAGYAM CONSTRUCTIONS CIR.V 403A VELACHERY MAIN RD. VELACHERY CHENNAI CHENNAI-600042 (PAN AADPG 3022B) (APPLICANT) (RESPONDENT) APPLICANT BY: SHRI T.N. SEETHARAMAN RESPONDENT BY: SHRI B.SRINIVASAN ORDER PER ABRAHAM P.GEORGE ACCOUNTANT MEMBER IN THIS MISC. APPLICATION GRIEVANCE OF THE ASSESSE E IS THAT THE TRIBUNAL DID NOT TAKE NOTE OF THE FACTS SET OUT IN REVENUES GROUNDS OF APPEAL AND IN THE ASSESSEES CROSS-OBJECTIONS. 2. ACCORDING TO THE ASSESSEE REVENUE HAD IN ITS AP PEAL NEVER SUGGESTED EXISTENCE OF ANY POWER OF ATTORNEY FOR EXECUTION OF SALE DEED S TO THE DEVELOPER. ASSESSEE IS ALSO AGGRIEVED THAT THE REVENUE ITSELF CONCEDED HANDING OVER POSSESSION OF THE LAND WAS NOT DONE ON 23-2-2000 THE DATE OF EXECUTION OF DEV ELOPMENT AGREEMENT BUT THIS WAS NOT CONSIDERED BY THIS TRIBUNAL. FURTHER ACCORDING TO IT LICENCE TO ENTER THE PROPERTY ALONE WAS GIVEN TO THE DEVELOPER AND THERE WAS NO P OSSESSION GIVEN SINCE PARTIAL MP NO.128/MDS/10 2 POSSESSION COULD NOT BE GIVEN OF UNDIVIDED SHARE OF LAND. SUM AND SUBSTANCE OF THE SUBMISSION OF THE ASSESSEE IN THE PETITION IS THAT THIS TRIBUNAL COMMITTED A GRIEVOUS ERROR IN HOLDING THAT PROVISIONS OF SEC. 2(47)/53A WERE SATISFIED. 3. LD. COUNSEL FOR THE ASSESSEE STRONGLY SUBMITTED THAT THE TRIBUNAL HAD WENT AHEAD WITH THE ADJUDICATION WITHOUT VERIFYING THE P OWER OF ATTORNEY. PER CONTRA LD. D.R. SUBMITTED THAT ASSESSEE WAS SEEKING THE REVIE W OF AN ORDER OF THIS TRIBUNAL WHICH WAS GIVEN AFTER CONSIDERING ALL THE RELEVANT FACTS. 4. THE ISSUE BEFORE THIS TRIBUNAL WAS REGARDING TRA NSFER OF LAND AT DOOR NO.34A VELACHERY MAIN ROAD CHENNAI MEASURING 25 630 SQ. FT. AS PER THE ASSESSEE THERE WAS NO HANDING OVER OF POSSESSION OF LAND AT THE TIME O F EXECUTION OF DEVELOPMENT AGREEMENT WITH M/S. BHAGYAM CONSTRUCTIONS. CLAUSE ( 16) OF THE JOINT DEVELOPMENT DEED WAS RELIED ON BY THE ASSESSEE FOR ARGUING THAT FOR POSSESSION OF LAND WAS WITH THE ASSESSEE TILL COMPLETION OF THE CONSTRUCTION. ON TH E OTHER HAND CASE OF THE REVENUE WAS THAT ASSESSEE HAD EXECUTED POWER OF ATTORNEY IN FAVOUR OF THE PARTNER OF THE DEVELOPER FOR MAKING APPLICATION FOR APPROVAL OF CO NSTRUCTION AND SUCH APPLICATION WAS GIVEN ON 13-9-2000 AND THE APPROVAL ISSUED BY THE C OMPETENT AUTHORITY ON 20-11-2000. ON THE BASIS OF THE DEVELOPMENT AGREEMENT IT WAS H ELD BY THE TRIBUNAL THAT THERE WAS AN INTENTION TO TRANSFER 57% OF THE LAND BY THE ASS ESSEE IN FAVOUR OF THE DEVELOPER. PARAS 2.5 TO 2.7 OF THE TRIBUNAL ORDER REPRODUCED H EREUNDER WOULD CLEARLY SHOW THAT THIS TRIBUNAL HAD CONSIDERED ALL THE ASPECTS OF THE CASE: 2.5 WE HAVE CONSIDERED THE RIVAL CONTENTIONS A ND RELEVANT RECORDS. THE ASSESSEE HAS ENTERED INTO AN AGREEMENT FOR DEVELOPMENT OF THE PR OPERTY IN QUESTION WITH M/S BHAGYAM MP NO.128/MDS/10 3 CONSTRUCTIONS A PARTNERSHIP FIRM. AS PER THE TERMS OF THE AGREEMENT THE DEVELOPER HAD TO CONSTRUCT THE ENTIRE PROPERTY AS PER THE PLAN TO BE APPROVED. THE PARTIES AGREED THAT THE ENTIRE EXPENDITURE FOR DEVELOPMENT OF THE PROPERTY SHALL BE BORNE BY THE DEVELOPER AND THE CONSTRUCTED PROPERTY WILL BE DIVIDED IN THE SHA RE OF 43 AND 57 PER CENT BETWEEN THE ASSESSEE AND THE DEVELOPER. THEREFORE THE ASSESSEE HAS GIVEN 57 PER CENT OF THE LAND TO THE DEVELOPER AND IN CONSIDERATION THE ASSESSEE W OULD GET 43 PER CENT OF THE CONSTRUCTED PROPERTY ON HIS SHARE OF LAND. THE COST OF THE CONS TRUCTION OF 43 PER CENT IS VALUED AT RS.1 24 00 000/- AS PER CL. (14A) OF THE AGREEMENT. AS PER THE TERMS OF THE AGREEMENT THE ASSESSEE HAS TO EXECUTE THE SALE DEED OR OTHER TRANSFER DOCUMENTS IN RESPECT OF 57 PER CENT SHARE IN THE LAND EARMARKED FOR DEVELOPMEN T IN FAVOUR OF THE DEVELOPER OR HIS NOMINEE AS AND WHEN THE ASSESSEE WAS CALLED UPON T O DO SO. IT WAS ALSO AGREED BETWEEN THE PARTIES THAT THE ASSESSEE HAS TO GIVE A POSER O F ATTORNEY IN FAVOUR OF THE NOMINEE OF THE DEVELOPER EMPOWERING HIM TO EXECUTE THE SALE DE ED IN RESPECT OF THE UNDIVIDED SHARE OUT OF 57 PER CENT EARMARKED FOR THE DEVELOPER. AS PER CL. (23) OF THE AGREEMENT THE DEVELOPER WAS PERMITTED TO SALE NEGOTIATE FOR SALE BOOK THE FLATS ENTER INTO AGREEMENT FOR SALE AND RECEIVE ADVANCE IN RESPECT OF 57 PER C ENT UNDIVIDED SHARE OF THE LAND EARMARKED FOR THE DEVELOPER AND ALSO PLINTH AREA W HERE ENTITLED AS PER AGREEMENT. FROM THE TERMS AND CONDITIONS OF THE AGREEMENT IT IS CL EAR THAT THE ASSESSEE HAS AGREED TO TRANSFER 57 PERCENT OF THE LAND IN FAVOUR OF THE DE VELOPER OR NOMINEES OF THE DEVELOPER. THE ASSESSEE WAS TO RECEIVE THE CONSIDERATION IN TH E FORM OF CONSTRUCTION OF FLATS ON THE REMAINING 43 PER CENT OF HIS LAND. THERE IS NO DISP UTE ABOUT THIS CONSIDERATION FIXED IN THE AGREEMENT AT RS.1 24 00 000/-. 2.6 FROM THE AGREEMENT IT IS CLEAR THAT THE I NTENTION OF THE PARTIES TO THE AGREEMENT WAS TO TRANSFER 57 PER CENT OF THE LAND BY THE ASSE SSEE IN FAVOUR OF THE DEVELOPER AND REMAINING 43 PER CENT WAS RETAINED BY THE ASSESSEE. AS PER THE PROVISIONS OF SEC. 2(47)(V) A CAPITAL ASSET IS DEEMED TO HAVE BEEN TRANSFERRED WHEN THE CONDITIONS PROVIDED U/S 53A OF THE TRANSFER OF PROPERTY ACT ARE SATISFIED. THUS SEC. 2(47) PROVIDES FOR A DEEMING TRANSFER WHEN THE CONDITIONS PRESCRIBED U/S 53A OF TRANSFER OF PROPERTY ACT ARE SATISFIED. SEC. 53A OF THE TRANSFER OF PROPERTY ACT DOES NOT P ROVIDE FOR ANY TRANSFER BUT IT PROVIDES PROTECTION TO THE TRANSFEREE/BUYER OF ANY IMMOVABLE PROPERTY UNDER A WRITTEN AGREEMENT/CONTRACT AND WHEN THE TRANSFEREE AS PART PERFORMANCE OF THE CONTRACT HAS TAKEN POSSESSION OF THE PROPERTY AND HAS PERFORMED OR WILLING TO PERFORM HIS PART OF THE CONTRACT THEN EVEN IF THE OTHER CONDITIONS OF TRA NSFER ARE NOT SATISFIED AS PRESCRIBED UNDER LAW THE TRANSFEROR IS BARRED FROM ENFORCING AGAIN ST THE TRANSFEREE ANY RIGHT IN RESPECT OF THE PROPERTY OTHER THAN THE RIGHTS EXPRESSLY PROVID ED BY THE TERMS OF THE CONTRACT. AS FAR AS THE SHARE OF THE ASSESSEE EARMARKED TO THE EXTEN T OF 43 PER CENT OF THE LAND THE SAME WAS NEVER INTENDED TO BE TRANSFERRED TO THE DEVELOP ER AND POSSESSION IN RESPECT OF THAT SHARE WAS HANDED OVER ONLY FOR THE PURPOSE OF CONST RUCTION OF RESIDENTIAL FLATS. THE REMAINING 57 PER CENT OF THE LAND EARMARKED FOR THE DEVELOPER WAS CLEARLY GIVEN TO THE DEVELOPER FOR DEVELOPMENT AND FURTHER SALE TO THE E ND PURCHASERS. THE ASSESSEE HAS TO EXECUTE THE SALE DEED IF THE DEVELOPER SO DESIRES I N FAVOUR OF THE PURCHASER. THIS MUTUAL OBLIGATION BETWEEN THE PARTIES AS PER THE AGREEMENT WAS ONLY FOR THE SAKE OF CONVENIENCE AND TO AVOID STAMP DUTY ON MULTIPLE TRANSACTIONS. T HEREFORE THERE IS NO AMBIGUITY OR ANY DOUBT THAT THE PARTIES WERE FULLY AWARE THAT THE DE VELOPER HAD THE RIGHT TO SALE AND TRANSFER 57 PER CENT OF THE PROPERTY DEVELOPED UNDE R THE AGREEMENT. 2.7 AS PER THE AGREEMENT THE ASSESSEE AGREED FOR E XECUTION OF POWER OF ATTORNEY FOR TAKING APPROVAL FROM THE AUTHORITIES AS WELL AS FOR SALE OF THE FLATS BY THE DEVELOPER IN RESPECT OF 57 PER CENT SHARE EARMARKED FOR THE DEVE LOPER. ONCE THE DEVELOPER HAS AGREED AND PERFORMED HIS PART AS PER THE AGREEMENT BY OBT AINING THE APPROVAL OF THE PLAN AND OTHER PERMISSIONS FOR DEVELOPMENT OF THE PROPERTY A ND STARTED EXECUTION OF THE DEVELOPMENT WORK THE CONDITIONS PRESCRIBED U/S 53 A OF THE TRANSFER OF PROPERTY ACT ARE MP NO.128/MDS/10 4 FULFILLED. ACCORDINGLY THE TRANSFER WAS DEEMED TO HAVE TAKEN PLACE AS PER THE PROVISIONS OF SEC. 2(47)(V) OF THE INCOME-TAX ACT ON THE POINT WH EN THE DEVELOPER PERFORMED HIS PART OF THE CONTRACT BY COMMENCING THE EXECUTION OF DEVELOP MENT WORK. IT IS AN UNDISPUTED FACT THAT THE ASSESSEE EXECUTED A POWER OF ATTORNEY IN F AVOUR OF THE DEVELOPER BUT SINCE THE POWER OF ATTORNEY HAS NOT BEEN PLACED BEFORE US BY EITHER OF THE PARTIES FOR EXAMINATION OF THE CONTENTS OF THE POWER OF ATTORNEY AND EVEN THE LOWER AUTHORITIES HAVE ALSO NOT DISCUSSED ABOUT ANY TERMS AND CONDITIONS OF THE POW ER OF ATTORNEY THEN WE ARE UNABLE TO COMMENT ABOUT THE POWER TRANSFERRED BY THE ASSESEE UNDER THE SAID POWER OF ATTORNEY. HOWEVER FROM THE TERMS AND CONDITIONS OF THE AGREE MENT IT IS CLEAR THAT THE POWER OF ATTORNEY WAS EXECUTED BY THE ASSESSEE FOR TWO PURPO SES (I) FOR OBTAINING THE NECESSARY APPROVALS AND SANCTIONS FROM THE AUTHORITIES FOR CO NSTRUCTION OF THE FLATS AND (II) FOR EXECUTION OF SALE DEED BY THE DEVELOPER IN RESPECT OF THE FLATS CONSTRUCTED OVER 57 PER CENT OF THE LAND EARMARKED FOR THE DEVELOPER. THUS WE FIND THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAS TAKEN A VIEW WITHOUT CONSI DERING THE SUBSEQUENT POWER OF ATTORNEY EXECUTED BY THE ASSESSEE ENABLING THE DEVE LOPER TO EXECUTE THE DEVELOPMENT WORK AND THE ACTUAL PERFORMANCE ON THE PART OF THE DEVELOPER WHEN HE STARTED THE CONSTRUCTION WORK. ACCORDINGLY WE SET ASIDE THE OR DER OF THE COMMISSIONER OF INCOME TAX (APPEALS) AND RESTORE THE ORDER OF THE ASSESSING OF FICER AND HOLD THAT THE CAPITAL GAIN ARISING OUT OF THE TRANSACTION OF DEVELOPMENT OF TH E PROPERTY IN QUESTION IS ASSESSABLE FOR THE ASSESSMENT YEAR 2001-02. 5. IN THE CROSS-OBJECTION OF THE ASSESSEE ALSO THE ISSUE WAS REGARDING ASSESSABILITY TO CAPITAL GAINS AND IT WAS DECIDED BY THIS TRIBUNA L THAT TRANSACTION OF TRANSFER WAS COMPLETED DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2001-02. IT WAS SPECIFICALLY NOTED BY THE TRIBUNAL THAT POWER OF ATTORNEY WAS NOT PLACED BEFORE THE BENCH BY EITHER PARTIES FOR EXAMINATION OF ITS CONT ENTS. THUS IT IS CLEAR THAT THE TRIBUNAL HAD COME TO A CONSCIOUS DECISION AFTER CONSIDERING ALL THE AVERMENTS OF BOTH THE PARTIES. THROUGH THIS MISC. PETITION THE ASSESSEE I S EFFECTIVELY SEEKING REVIEW OF THE ORDER OF THE TRIBUNAL AND THIS TRIBUNAL HAS NO POWE R OF REVIEW U/S 254(2) OF THE ACT. 6. THE CRUCIAL EXPRESSION MISTAKE APPARENT FROM TH E RECORD CAME UP FOR ADJUDICATION BEFORE THE HON'BLE SUPREME COURT IN TH E CELEBRATED CASE OF T.S. BALARAM ITO V. VOKART BR. (1971) 82 ITR 50. IN THIS CASE I T WAS HELD THAT: A MISTAKE APPARENT ON THE RECORD MUST BE AN OBVIOUS AND PATENT MISTAKE AND NOT SOMETHING WHICH CAN BE ESTABLISHED BY A LONG DRAWN PROCESS OF REASONING ON POINTS ON WHICH THERE MAY BE MP NO.128/MDS/10 5 CONCEIVABLY TWO OPINIONS. A DECISION ON DEBATABLE POINT OF LAW IS NOT A MISTAKE APPARENT FROM THE RECORD. THE HON'BLE SUPREME COU RT IN THE CASE OF CIT V. HERO CYCLES (P.) LTD. (1997) 228 ITR 463 (1) CONSIDERED THE SCOPE OF RECTIFICATION PROCEEDINGS. IN THIS CASE THE CLAIM FOR DEDUCTION U/S 35B WAS NOT ORIGINALLY ALLOWED AT ALL. AN ORDER WAS PASSED BY THE CIT(A) ON ASSESSEE S APPLICATION DIRECTING CERTAIN ALLOWANCE TO BE GIVEN ON PROPORTIONATE BASIS AFTER VERIFICATION OF THE ASSESSEES CLAIM U/S 35B. THE ITO THEREAFTER ENTERTAINED THE ASSESS EES PRAYER FOR RECTIFICATION OF THE ORDER AND ALLOWED THE ASSESSEES CLAIM IN RESPECT O F MATTERS LIKE COLOURED ALBUMS EXPORT STAFF TRAVELLING EXPENSES EXPORT SALES COMM ISSION ETC. WHEN THE MATTER TRAVELLED TO THE HON'BLE SUMMIT COURT REITERATING THE WELL SETTLED POSITION IN LAW IT WAS HELD THAT : RECTIFICATION IS NOT POSSIBLE IF THE QUESTION IS DEBATABLE. MOREOVER THE POINT WHICH WAS NOT EXAMINED ON FACTS OR IN LAW CAN NOT BE DEALT AS MISTAKE APPARENT ON THE RECORD. MORE RECENTLY THE HON'BLE SUPREME COURT IN THE CASE OF ACIT V. SAURASHTRA KUTCH STOCK EXCHANGE LTD. (305 ITR 227) C AME TO HOLD AS UNDER:- A PATENT MANIFEST AND SELF-EVIDENT ERROR WHICH DOE S NOT REQUIRE ELABORATE DISCUSSION OF EVIDENCE OR ARGUMENT TO ESTABLISH IT CAN BE SAID TO BE AN ERROR APPARENT ON THE FACE OF THE RECORD AND CAN BE CORRECTED WHILE EXERCISING CERTIORARI JURISDICTION. AN ERROR CANNO T BE SAID TO BE APPARENT ON THE FACE OF THE RECORD IF ONE HAS TO TRAVEL BEYOND THE RECORD TO SEE WHETHER THE JUDGEMENT IS CORRECT OR NOT. AN ERROR APPARENT ON THE RECORD MEANS AN ERROR WHICH STRIKES ON MERE LOOKING AND DO ES NOT NEED A LONG DRAWN OUT PROCESS OF REASONING ON POINTS ON WHICH T HERE MAY BE CONCEIVABLY TWO OPINIONS. SUCH ERROR SHOULD NOT RE QUIRE ANY EXTRANEOUS MATTER TO SHOW ITS INCORRECTNESS. TO PUT IT DIFFER ENTLY IT SHOULD BE SO MANIFEST AND CLEAR THAT NO COURT WOULD PERMIT IT TO REMAIN ON RECORD. IF THE VIEW ACCEPTED BY THE COURT IN THE ORIGINAL JUDG EMENT IS ONE OF POSSIBLE VIEWS THE CASE CANNOT BE SAID TO BE COVERED BY AN ERROR APPARENT ON THE FACE OF THE RECORD MP NO.128/MDS/10 6 7. A SURVEY OF THE AFORE-NOTED THREE JUDGEMENTS OF THE HON'BLE APEX COURT MAKES IT CLEAR THAT THE SCOPE OF PROCEEDINGS U/S 254(2) I S CONFINED TO RECTIFYING ANY MISTAKE WHICH IS APPARENT ON THE VERY FACE OF IT. IF THE P OINT NEEDS TO BE PROVED ON THE STRENGTH OF DIFFERENT FACETS OF REASONING THE SAME WOULD BECOME DEBATABLE. ONCE A PARTICULAR POINT FALLS IN THE REALM OF DEBATABLE I SSUE THAT AUTOMATICALLY GOES OUT OF THE DOMAIN OF SUB-SECTION (2) OF SECTION 254. THUS THE ERROR CAPABLE OF RECTIFICATION UNDER THIS SUB-SECTION MUST BE ONE WHICH IS APPARENT ON THE FACE OR ORDER ITSELF. FURTHER IF TWO VIEWS ARE POSSIBLE ON A PARTICULAR POINT AND TH E TRIBUNAL HAS PREFERRED ONE VIEW OVER THE OTHER NO RECTIFICATION APPLICATION LIES F OR IMPRESSING UPON THE TRIBUNAL TO CHOOSE THE OTHER POSSIBLE VIEW IN PREFERENCE OVER T HE ONE ALREADY ADOPTED BY IT. IF HOWEVER THE ORDER PASSED BY THE TRIBUNAL IS NOT IN CONFORMITY WITH THE JUDGEMENT OF THE HON'BLE SUPREME COURT OR THAT OF THE JURISDICTI ONAL HIGH COURT RENDERED PRIOR TO OR SUBSEQUENT TO THE IMPUGNED ORDER THE SAME CONSTITU TES A MISTAKE FROM RECORD CAPABLE OF RECTIFICATION U/S 254(2). IN THE SAME BREATH IT WILL BE AN ERROR APPARENT FROM RECORD IF THE ORDER IS NOT IN CONFORMITY WITH THE RETROSPE CTIVE AMENDMENT CARRIED OUT TO THE STATUTORY PROVISION COVERING THE PERIOD AND POINT I N DISPUTE OF COURSE SUBJECT TO THE FULFILLMENT OF OTHER CONDITIONS PRESCRIBED IN THE A CT SUCH AS LIMITATION PERIOD ETC. 8. IT IS THEREFORE CLEAR THAT THE POWER GIVEN TO THE TRIBUNAL U/S 254(2) IS CONFINED TO RECTIFYING ANY MISTAKE WHICH IS APPARENT FROM TH E RECORD. THE TRIBUNAL IS NOT EMPOWERED TO REVIEW ITS ORDER IN THE GARB OF RECTIF ICATION U/S 254(2). THE HON'BLE MUMBAI HIGH COURT IN THE CASE OF RAMESH ELECTRIC & T RADING CO. (203 ITR 497) CONSIDERED A CASE IN WHICH THE TRIBUNAL WAS REQUIRE D TO DECIDE WHETHER THE COMMISSION MP NO.128/MDS/10 7 PAYMENT OF ` 54 000 WAS DEDUCTIBLE U/S 37. AFTER E XAMINING THE CIRCUMSTANCES IT CAME TO THE CONCLUSION THAT THE AMOUNT WAS NOT DEDUCTIBL E. THE ASSESSEE MOVED MISCELLANEOUS APPLICATION U/S 254(2) STATING THAT A LTHOUGH THE APPEAL MEMO CONTAINED FIVE DIFFERENT GROUNDS OF APPEAL BUT THE ORDER OF T HE TRIBUNAL DID NOT MENTION THREE OF THE GROUNDS. IT WAS CONTENDED THAT THE ORDER OF TH E TRIBUNAL DID NOT CONSIDER SOME OF THE ARGUMENTS ADVANCED BY THE ASSESSEE. SUCH APPLI CATION WAS ENTERTAINED BY THE TRIBUNAL. ON RE-HEARING THE MATTER THE ASSESSEE WA S ALLOWED DEDUCTION OF THE COMMISSION PAYMENT BY THE TRIBUNAL. ON APPEAL THE HON'BLE BOMBAY HIGH COURT HELD AS UNDER:- THESE TWO ARGUMENTS ACCORDING TO THE TRIBUNAL WER E OVERLOOKED BY IT WHILE PASSING THE EARLIER ORDER AND HENCE IT PUR PORTED TO EXERCISE ITS POWER OF RECTIFICATION BY RE-EXAMINING ALL THE CIRC UMSTANCES RELATING TO THIS TRANSACTION AND UPHOLDING IT. CLEARLY THIS COULD NOT HAVE BEEN DONE IN THE EXERCISE OF ANY POWER OF RECTIFICATION. IN THE PRE SENT CASE IN THE FIRST ORDER THERE IS NO MISTAKE WHICH IS APPARENT FROM T HE RECORD AT ALL. THE TRIBUNAL WAS REQUIRED TO DECIDE WHETHER THE COMMISS ION PAYMENT OF ` 54 000 WAS DEDUCTIBLE UNDER SECTION 37 OF THE INCOM E-TAX ACT. AFTER EXAMINING THE CIRCUMSTANCES THE TRIBUNAL CAME TO T HE CONCLUSION THAT IT WAS NOT SO DEDUCTIBLE. THE TRIBUNAL CANNOT IN EXE RCISE OF ITS POWER OF RECTIFICATION LOOK INTO SOME OTHER CIRCUMSTANCES W HICH WOULD SUPPORT OR NOT SUPPORT ITS CONCLUSION SO ARRIVED AT. THE MIST AKE WHICH THE TRIBUNAL IS ENTITLED TO CORRECT IS NOT AN ERROR OF JUDGEMENT BU T A MISTAKE WHICH IS APPARENT FROM THE RECORD ITSELF. NO SUCH MISTAKE W AS APPARENT FROM THE RECORD. IN FACT WE DOUBT IF THIS SORT OF AN EXERC ISE COULD HAVE BEEN DONE BY THE TRIBUNAL EVEN IF IT HAD THE POWER OF REVIEW. THE TRIBUNAL HAS PATENTLY FAR EXCEEDED ITS JURISDICTION UNDER SECTI ON 254(2) OF THE INCOME- TAX ACT IN REDECIDING THE ENTIRE DISPUTE WHICH WAS BEFORE IT IN THIS FASHION AND THE TRIBUNAL HAS COMMITTED A GROSS AND INEXPLIC ABLE ERROR FOR REASONS WHICH WE FAIL TO UNDERSTAND. 9. THUS IT IS EVIDENT THAT THE TRIBUNAL HAS ONLY GO T A LIMITED POWER OF RECTIFYING A MISTAKE WHICH IS APPARENT FROM THE RECORD ITSELF AN D EVEN AN ERROR OF JUDGEMENT IS MP NO.128/MDS/10 8 OUTSIDE THE AMBIT OF SECTION 254(2) OF THE ACT. TH E OFT-QUOTED JUDGEMENT OF THE HON'BLE RAJASTHAN HIGH COURT IN CIT V. RAMESH CHAND MODI (2001) 249 ITR 323(2) DISTINGUISHING THE JUDGEMENT OF THE HON'BLE MUMBAI HIGH COURT IN THE CASE OF RAMESH ELECTRIC & TRADING CO. (SUPRA) NEEDS TO BE EXAMINED. IN THE LATTER CASE THE TRIBUNAL OMITTED TO DECIDE SOME OF THE GROUNDS OF THE APPEAL BY OVERSIGHT. THE HON'BLE RAJASTHAN HIGH COURT APPROVED THE VIEW TAKEN BY THE TRIBUNAL IN EXERCISING ITS POWER U/S 254(2) BY RECALLING THE ORDER TO MAKE A FRESH O RDER DECIDING THE ISSUES WHICH WERE LEFT UNDECIDED. THE HON'BLE RAJASTHAN HIGH COURT D ISCUSSED IN PARA 5 THE JUDGEMENT OF THE HON'BLE MUMBAI HIGH COURT IN RAMESH ELECTRIC & T RADING CO. (SUPRA) AND HELD THAT THE ISSUE RAISED BEFORE IT WAS DIFFERENT FROM THE O NE CONSIDERED BY THE HON'BLE BOMBAY HIGH COURT. IT WAS CLARIFIED THAT THE RATIO DECIDE NDI OF RAMESH ELECTRIC & TRADING CO. (SUPRA) WAS THAT WHILE DECIDING AN ISSUE THE TRIBUN AL DID NOT TAKE INTO CONSIDERATION SOME OF THE ARGUMENTS AND IT WAS UNDER THOSE CIRCUM STANCES THAT THE MISCELLANEOUS APPLICATION WAS HELD TO BE NOT MAINTAINABLE. FURTH ER IT WAS CLARIFIED THAT THE CASE BEFORE THE HON'BLE RAJASTHAN HIGH COURT WAS ON THE FAILURE TO DECIDE THE GROUNDS RAISED BY THE ASSESSEE IN APPEAL MEMO. IT IS THER EFORE AXIOMATIC THAT THE JUDGEMENT OF THE HON'BLE MUMBAI HIGH COURT IN THE CASE OF RAM ESH ELECTRIC & TRADING CO. (SUPRA) HAS NOT BEEN DILUTED IN ANY MANNER BY ANY OTHER COU RTS INCLUDING THE RAJASTHAN HIGH COURT IN RAMESH CHAND MODI (SUPRA). STILL RECENTLY IN RAS BIHARI BANSAL V. CIT (2007) 293 ITR 365(3) HON'BLE DELHI HIGH COURT RULED THAT SECTION 254(2) ENABLES THE TRIBUNAL TO RECTIFY ANY MISTAKE WHICH IS ONLY APPARENT FROM THE RECORD THAT AN OVERSIGHT OF A FACT CANNOT CONSTITUTE AN APPARENT MISTAKE RECTIFIA BLE UNDER THIS SECTION. FAILURE OF THE MP NO.128/MDS/10 9 TRIBUNAL TO CONSIDER THE JUDGEMENT OF A NON-JURISDI CTIONAL HIGH COURT CITED BY PARTY BEFORE IT ALSO COULD NOT BE A MISTAKE APPARENT FRO M THE RECORD AMENABLE TO PROCEEDINGS UNDER SECTION 254(2) AS HELD BY THE HON 'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF VISWAS PROMOTERS P. LTD. V. ACIT (2009) 30 DTR 65. SIMILARLY 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 JUDGEMENT. THE MERE FACT THAT THE TRIBUNAL HAD NOT ALLOWED A DEDUC TION WILL BE NO GROUND FOR MOVING AN APPLICATION UNDER SECTION 254(2). AN ERRONEOUS ORDER CAN ONLY BE RECTIFIED OR MODIFIED OR SET ASIDE IN A PROCEDURE KNOWN TO THE L AW AND NOT IN A PROCEEDING UNDER SECTION 254(2) AS HELD BY HON'BLE JURISDICTIONAL H IGH COURT IN THE CASE OF EXPRESS NEWSPAPERS LTD. V. DCIT (320 ITR 12). THUS IN THE GRAB OF AN APPLICATION FOR RECTIFICATION THE ASSESSEE CANNOT BE PERMITTED TO REOPEN AND RE-ARGUE THE WHOLE MATTER WHICH IS BEYOND THE SCOPE OF THE SECTION. HENCE WE FIND NO MERIT IN THE MISC. APPLICATION FILED BY THE ASSESSEE. IT STANDS DISMIS SED. THE ORDER WAS PRONOUNCED IN OPEN COURT SOON AFTER HEARING ON 30-07-2010. . SD/- (GEORGE MATHAN) SD/- (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI: 30 TH JULY 2010 NBR CC: THE ASSESSEE 2)THE ASSESSING OFFICER 3)THE C IT(A) 4) THE CIT 5)THE D.R 6)GUARD FILE.