Shri M.Alagesan, Tiruvannamalai v. ITO, CHENNAI

IN THE INCOME-TAX APPELLATE TRIBUNAL CHENNAI C BENCH CHENNAI. BEFORE SHRI.U.B.S. BEDI J.M. & SHRI.ABRAHAM P. GEORGE A.M. M.P. NO.153/MDS/2010 [IN ITA NO. 338/MDS/2008] ASSESSMENT YEAR: 2003-04 SHRI M. ALAGESAN PROP: MANIKANDAN RICE MILL PALVARTHUVENDAN VILLA GE POLUR TALUK THIRUVANNAMALAI DISTRICT. [PAN:AGITA7815G] VS. THE INCOME TAX OFFICER WARD I (4) VELLORE. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S. SRIDHAR REVENUE BY : SHRI P.B. SEKHARAN ORDER PER U.B.S. BEDI J.M . BY MEANS OF PRESENT MISCE LLANEOUS PETITION THE ASSESSEE SEEKS TO GET RECALLED THE ORDER OF THE TRIBUNAL IN ITA NO. 338/MDS/2008 DATED 23.10. 2008 MAINLY ON THE GROUND THAT THE ASSESSEE HAD SENT ADJOURNMENT REQUEST WHICH REACHED THE REGISTRY OF THE BENCH BELATEDLY I.E. BEYOND THE HEARING DATE AND PASSING OF THE EX-PARTE ORDER OVERLOOKING SUCH REQUEST WOULD BE VIOLATIVE OF PRINCIPLES OF LEGITIMATE EXPECTATION AS WELL AS DOCTRINE OF FAIR PROCEDURE. IT WAS T HUS SUBMITTED THAT RU LE 25 THOUGH ENVISAGES THE DISPOSAL OF THE DEPARTMENT AL APPEAL EX-PARTE THE PROVIS O TO THE SAID RULE GIVES DISCRETION TO THE BENCH TO RECALL THE EX-PAR TE ORDER IF THE PETITIONER/APPLICANT SHOWS SUFFICIENT CAUSE FOR HIS NON-APPEARANCE LATER. SINCE THERE IS SUFFICIENT CAUSE FOR THE PETITIONER FOR NON-APPEARANCE BEFORE THE BENCH ON THE LAST DATE OF HEARING AND FAULT OF NON-DELIVERY OF ADJOURNMENT PETITION AT THE TIME OF HEARI NG OF THE APPEAL IS BEYOND THE CONTROL OF THE PETITIONER WHICH IS NEITHER W ILLFUL NOR DELIBERATE T HEREFORE IT WAS PRAYED MP NO.153/MDS/10 2 FOR RECALLING THE ORDER IN THE INTEREST OF JUST ICE WITH A VIEW TO GIVE AN OPPORTUNITY OF HEARING TO THE ASSESSEE. 2. THE LD. DR STRONGLY OPPOSED THE PLEA OF THE ASSESSEE AND SUBMITTED THAT THE PLEA RAISED BY THE ASSESSEE IS UNTENABLE IN AS MUCH AS NO MATERIAL OR EVIDENCE HAS BEEN PRODUCED WHETHER ANY REQUEST FOR ADJOUR NMENT WAS SENT AND W HAT WAS THE DATE OF THE REQUEST THROUGH WHICH MODE THE SAME HAS BEEN SUBMITTED AND SINCE NONE OF THE PARTICULARS HAS BEEN PLACED ON RECORD AND OTHERWISE EX-PARTE ORDER HAS BEEN PASSED ON MERITS AFTER DISCUSSING EACH AND EVERY POINTS RAISED IN THE APPEAL OF THE DEPARTMENT AND THE ASSESSEE HAS NOT BEEN ABLE TO POINT OUT ANY MISTAKE IN THE ORDER IN HIS PETITION OR DEMONSTRATED BY THE LD. COUNSEL FOR THE ASSESSEE AT THE TIME OF HEARING OF THE PETITION THEREFORE NO CASE HAS BEEN MADE OUT BY THE ASSESSEE EVEN IN TERMS OF PROVISO TO RULE 25 OR OTHERWISE RELIANCE WAS PLACED ON B BENCH IN MP NO. 310/MDS/2009 ETC. DATED 09.11.2010 (COPY OF THE ORDER FILED) . IT WAS FURTHER SUBMITTED THAT IF THE APPLICATION OF THE ASSESSEE IS A CCEPTED THAT WOULD AMOUNT TO REVIEW OF THE ORDER WHICH IS NOT PERMISSIBLE UNDER LAW THEREFOR E THE PETITION OF THE ASSESSEE SHOULD BE DISMISSED. 3. WE HAVE HEARD BOTH THE SI DES CONSIDERED THE MATERIAL ON RECORD AND FIND THAT DESPITE RECEIVING THE NOTICE (AS ADMITTED) THE ASSESSEE HAS NOT APPEARED ON THE DATE OF HEARING NOR ANY REQUEST FOR ADJOURNMENT HAS BEEN RECEIVED. THE PLEA RAISED THAT THE ASSESSEE HAS SENT SOME ADJ OURNMENT REQUEST THE ASSESS EE HAS NOT BEEN ABLE TO SUBSTANTIATE SUCH CLAIM BY FURNISHING ANY MATERIAL OR EVIDENCE IN THIS REGARD AND OTHERWISE APPEAL OF THE DEPA RTMENT HAS BEEN DECIDED ON MERIT WHILE DISCUSSING AND CONSIDERING EACH AND EVERY POINTS RAISED BY THE DEPARTMENT AND THE ASSESSEE HAS NOT MP NO.153/MDS/10 3 BEEN ABLE TO POINT OUT ANY APPAREN T MISTAKE IN THE SAID ORDER. THEREFORE WE ARE OF THE VIEW THAT THE ASSESSEE HAS NOT BEEN ABLE TO MAKE OUT A CASE TO INVOKE THE PROVISO TO RULE 25 OF ITAT RULES OTHERWISE NO MIST AKE HAS BEEN POINTED OR FOUND IN THE ORDER PASSED BY THE BENCH AND IN CASE PETITION OF THE ASSESSEE IS ACCEPTED IT WOULD AMOUNT TO REVIEW OF THE ORDER WHICH IS NOT PERMISSI BLE AND THE TRIBUNAL IS NOT EMPOWERED TO REVIEW THE ORDER PASSED EITHER AND SUPPOR T CAN BE TAKEN FROM THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS GOKUL CHAND AGARWAL (202 ITR 14) WHICH HAS DEALT WITH THE SIMILA R POINT AND OPINED AS UNDER: SECTION 254(2) OF THE INCOME TAX ACT 1961 EMPOWERS THE TRIBUNAL TO AMEND ITS ORDER PASSED UNDER SECTION 254(1) TO RECTIF Y ANY MISTAKE APPARENT FROM THE RECORD EITHER SUO MOTO OR ON AN APPLICATION. THE JURISDICTION OF THE TRIBUNAL TO AMEND ITS ORDER THUS DEPENDS ON WHETHER OR NOT THERE IS A MISTAK E APPARENT FROM THE RECORD. IF IN ITS ORDER THERE IS NO MISTAKE WHICH IS PATENT AND OBVIOUS ON THE BASIS OF THE RECORD THE EXERCISE OF THE JURISDICTION BY THE TRIBUNAL UNDER SECTION 254(2) WILL BE ILLEGAL AND IMPROPER. AN OVERSIGHT OF A FACT CANNOT CONSTITUTE AN APPARENT MISTAKE RECTIFIABLE UNDER SECTION 254( 2). THIS MIGHT AT THE WORST LEAD TO PERVERSITY OF THE ORDER FOR WHICH THE REMEDY AVAILABLE TO THE ASSESSEE IS NOT UNDER SECTION 254(2) BUT A REFERENCE PROCEEDING UNDER SECTION 256. THE NORMAL RULE IS THAT THE REMEDY BY WAY OF REVIEW IS A CREATURE OF THE STATUTE AND UNLESS CLOTHED WITH SUCH POWER BY THE STATUTE NO AUTHORITY CAN EXERCISE THE POWER. REVIEW PROCEEDINGS IMPLY PR OCEEDINGS WHERE A PARTY AS OF RIGHT CAN APPLY FOR RECONSIDERATION OF THE MATTER ALREADY DECIDED UPON AFTER A FRESH HEARING ON THE MERITS O THE CONTROVERSY BETWEEN THE PARTIES. SUCH REMEDY IS CERTAINLY NOT PROVIDED BY THE INCOME TAX ACT 1961 IN RESPECT OF PROCEEDINGS BEFORE THE TRIBUNAL. 4.1 IN SIMILAR SITUATION WHILE DEALING WITH THE RECTIFIC ATION THE HON'BLE ANDHRA PRADESH HIGH COURT IN THE CASE OF CIT AND ANOR VS. I.T.A.T AND ANOR (206 ITR 126 HAS HELD AS UNDER: THE APPELLATE TRIBUNAL BEING A CREATURE OF THE STATUTE HAS TO CONFINE ITSELF IN THE EXERCISE OF ITS JURISDICTION TO THE ENAB LING OR EMPOWERING TERM S OF THE STATUTE. IT HAS NO INHERENT POWER. EVEN OTHERW ISE IN CASES WHERE SPECIFIC PROVISION DELINEATES THE POWERS OF THE COURT OR TRIBUNAL IT CANNOT DRAW UPON ITS ASSUMED INHERENT JURISDICTION AND PASS ORDERS AS IT PLEASES. THE POWER OF RECTIFICATION WHICH IS SPECIFICALLY CONFERRED ON THE TRI BUNAL HAS TO BE EXERCISE D IN TERMS OF THAT MP NO.153/MDS/10 4 PROVISION. IT CANNOT BE EN LARGED ON ANY ASSUMPTION TH AT THE TRIBUNAL HAS GOT AN INHERENT POWER OF RECTIFICA TION OR REVIEW OR REVISION. IT IS AXIOMATIC THAT SUCH POWER OF REVIEW OR REVISION HAS TO BE SPECI FICALLY CONFERRED IT CANNOT BE INFERRED. UNLESS THERE IS A MISTAKE APPARENT FROM THE RECORD IN THE SENSE OF PATENT OBVIOUS AND CLEAR ERROR OR MISTAKE THE TRIBUNAL C ANNOT RECALL ITS PREVIOUS ORDER. IF THE ERROR OR MISTAKE IS ONE WHICH COULD BE ESTABLISHED ONLY BY LONG DRAWN ARGUMENTS OR BY A PROCESS OF INVESTIGATION AND RESEARCH IT IS NOT A MISTAKE APPARENT FROM THE RECORD. 4.2 FURTHER THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS KARAM CHAND THAPAR AND BR.P.LTD. (176 ITR 535) HAS HELD AS UNDER: APPELLATE TRIBUNAL DUTY TO CONSIDER CUMULATIVE EFFECT OF CIRCUMSTANCES AND TOTALITY OF FACTS NO NEED TO STATE SO IN APPELLATE ORDER SPECIFICALLY INCOME TAX ACT 1961 SEC. 254 FURTHER IT WAS HELD AS UNDER: IT IS EQUALLY WELL SETTLED THAT THE DE CISION OF THE TRIB UNAL HAS NOT TO BE SCRUTINIZED SENTENCE BY SENTENCE MERELY TO FIND OUT WHETHER ALL FACTS HAVE BEEN SET OUT IN DETAIL BY THE TRIBUNAL OR WHETHER SOME INCIDENTAL FACT WHICH APPEARS ON THE RECORD HAS NOT BEEN NOTICED BY THE TRIBUNAL IN ITS JUDGMENT. IF THE COURT ON A FAIR READING OF THE JUDGMENT OF THE TRIBUNAL FINDS THAT IT HAS TAKEN INTO ACCOUNT ALL RELEVANT MATERIAL AND HAS NOT TAKEN INTO A CCOUNT ANY IRRELEVANT MATERIAL IN BASING ITS CONCLUSIONS THE DECISION OF THE TRIBUNAL IS NOT LIABL E TO BE INTERFERED WITH UNLESS OF COURSE THE CONCLUSIONS ARRI VED AT BY THE TRIBUNAL ARE PERVERSE. IT IS NOT NECESSARY FOR THE TRIBUNAL TO ST ATE IN ITS JUDGEMENT SPECIFICALLY OR IN EXPRESS WORDS THAT IT HAS TAKEN INTO ACCOUNT THE CUMULATIVE EFFECT OF THE CIRCUMSTANCES OR HAS CONSIDER ED THE TOTALITY OF THE FACTS AS IF THAT WERE A MAGIC FORMULA; IF THE JUDGMENT OF THE TRIBUNAL S HOWS THAT IT HAS IN FACT DONE SO THERE IS NO REASON TO INTERFERE WITH THE DECISION OF THE TRIBUNAL. SIMILARLY THE BOMBAY HIGH COURT IN THE CASE OF CIT-VS- RAMESH ELECTRIC AND TRADING CO. (203 ITR 497) .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 WHICH IS APPARENT FROM THE RECORD.. THE POWER OF RECTIFICATION UNDER SECTION 254(2) CAN BE EXERCISED ONLY WHEN THE MISTAK E WHICH IS SOUGHT TO BE RECTIFIED S AN OBVIOUS AND PATENT MISTAKE WHICH IS APPARENT FROM THE RECORD AND NOT A MISTAKE WHICH REQUIRED TO BE ESTABLISHED BY ARGUMENTS AND A LONG DRAWN PROCESS OF REASONING ON POINTS ON WHICH THERE MAY C ONCEIVABLY BE TWO OPINION. FAILURE OF MP NO.153/MDS/10 5 THE TRIBUNAL TO CONSIDER AN ARGUMENT ADVAN CED BY EITHER PARTY FOR ARRIVING AT A CONCLUSION IS NOT AN ERROR APPARENT ON THE RECORD ALTHOUGH IT MA Y BE AN ERROR OF JUDGMENTS 4.3 WE ALSO DRAW SUPPORT HERE FROM HONBLE MADRAS HIGH COURT DECISION IN T.C.(A) NO. 156 OF 2006 DATED 21.08.2007 IN THE CASE OF CIT VS. TAMIL NADU SMALL INDUSTRIES DEVELOPMENT CORPORATION LTD. WHEREIN THE HONBLE HIGH COURT HELD AS UNDER:- THE TRIBUNAL HAS NO POWER TO REVIEW ITS ORDER. WHEN THE TRIBUNAL HAS ALREADY DECIDED AN ISSUE BY APPLYING ITS MIND AGAI NST THE ASSESSEE THE SAME CANNOT BE RECTIFIED UNDER SECTION 254 (2) OF THE ACT. THERE WAS NO NECESSITY WHATSOEVER ON THE PART OF THE TRIBUNAL TO REVIEW ITS OWN ORDER. EVEN AFTER THE EXAMINATION OF THE JUDGMENTS OF THE TRIBUNAL WE COULD NOT FIND A SINGLE REASON IN THE WHOLE ORDER AS TO HOW THE TRIBUNAL IS JUSTIFIED AND FOR W HAT REASONS. THERE IS NO APPARENT ERROR ON THE FACE OF THE RECORD AND THEREBY TH E TRIBUNAL SAT AS AN APPELLATE AUTHORITY OVER ITS OWN ORDER. IT IS COMPLETELY IMPERMISSIBLE AND THE TRIBUNAL HAS TRAVELED OUT OF ITS JURISDICTION TO ALLOW A MISCE LLANEOUS PETITION IN THE NAME OF REVIEWING ITS OWN ORDER. IN THE PRESENT CASE IN THE GUISE OF RECT IFICATION THE TRIBUNAL REVIEWED ITS EARLIER ORDER AND ALLOWED THE MISCELLANEOUS PETI TION WHICH IS NOT IN ACCORDANCE WITH LAW. SECTION 254(2) OF THE ACT DOES NOT CONTEMPLATE REHE ARING OF THE APPEAL FOR A FRESH DISPOSAL AND DOING SO WOULD OBLITERAT E THE DISTINCTION BETWEEN THE POWER TO RECTIFY MISTAKES AND POWER TO REVIEW THE ORDER MADE BY THE TRIBUNAL. THE SCOPE AND AMBIT OF THE APPLICATION OF SECTION 254(2) IS LIMITED AND NARROW. IT IS RESTRICTED TO RECTIFICATION OF MISTAK ES APPARENT FROM THE RECORD. RECALLING THE ORDER OBVIOUSLY WOULD MEAN PASSING OF A FRESH ORDER. RECALLING OF THE ORDER IS NOT PERMISSIBLE UNDER SECTION 254(2) OF THE ACT. ONLY GLARING AND ANY MISTAKE APPARENT ON THE FACE OF TH E RECORD ALONE CAN BE RE CTIFIED AND HENCE ANYTHING DEBATABLE CANNOT BE A SUBJECT MATTER OF RECTIFICATION. 4.4 FURTHER WE PLACE RELIANCE UPON HON BLE DELHI HIGH COURT EXPOSITION ON THE SCOPE OF RECTIFICATION U/S 254(2) AS REPORT ED IN THE CASE OF RA S BIHARI BANSAL VS. COMMISSIONER OF INCOME TAX (2007) 293 ITR 365:- SECTION 254 OF THE INCOME TAX ACT 1961 ENABLES THE CONCER NED AUTHORITY TO RECTIFY ANY MISTAKE APPARENT FROM THE R ECORD. IT IS WE LL SETTLED THAT AN OVERSIGHT OF A FACT CANNOT CONSTITUTE AN APPARENT MISTAKE RECTIFIABLE UNDER THIS SECTION. SIMILARLY FAILURE OF THE TRI BUNAL TO CONSIDER AN ARGUMENT ADVANCED BY EITHER PARTY FOR ARRIVING AT A CONCLUSION IS NOT AN E RROR APPARENT ON THE RECORD ALTHOUGH IT MAY BE AN ERROR OF JUDGMENT. THE MERE FACT THAT THE TRIBUNAL HAD NOT ALLOWED A DEDUCTION EVEN IF THE CONC LUSION IS WRONG WILL BE NO GROUND FOR MP NO.153/MDS/10 6 MOVING AN APPLICATION UNDER SECTION 254(2) OF THE ACT. FURTHER IN THE GARB OF AN APPLICATION FOR RECTIF ICATION THE ASSESSEE CANNOT BE PERMITTED TO REOPEN AND RE- ARGUE THE WHOLE MATTER WHICH IS BEYOND THE SCOPE OF THE SECTION. 5. THEREFORE IN VIEW OF T HE FACTS CIRCUMSTANCES IN THE LIGHT OF RATIO OF DECISIONS CITED AND DISCUSSION AS HELD ABOVE WE DO NOT FIND ANY SUBSTANCE IN THE PETITION OF THE ASSESSEE AND DISMISS THE SAME BEING DEVOID OF ANY MERITS. 6. IN THE RESULT THE MISCELLANEOUS PE TITION OF THE ASSESSEE GETS DISMISSED. ORDER PRONOUNCED ON 11.02.2011. SD/- SD/- (ABRAHAM P. GEORGE) ACCOUNTANT MEMBER (U.B.S. BEDI) JUDICIAL MEMBER CHENNAI DATED THE 11.02.2011 VM/- TO:THE ASSESSEE//A.O./CIT(A)/CIT/D.R.