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2014 (6) TMI 630 - ITAT HYDERABADRectification of order - Allowability of deduction u/s 35(1) - Whether the right of the assessee to challenge the additions on merits can be maintained by the Tribunal despite the fact that the assessee failed to agitate and assert such rights before the Tribunal by filing a cross appeal or cross objection – Held that:- Relying upon CIT v. Rayala Corpn. (P) Ltd. [1995 (1) TMI 42 - MADRAS High Court] - It is the duty of the Tribunal to consider the subject-matter of the appeal and pass 'such orders' as are required to adjudicate the subject-matters before it- If for adjudicating various aspects of the subject-matter or matters incidental thereto, an order or direction is required to be issued, then, 'such order' or 'directions' are legally justified in view of the provisions contained under section 254(1) of the Income Tax Act - where particular issue has been omitted to be considered or has not been adjudicated properly or where perverse findings have been recorded in total disregard of the material on record, the Tribunal is competent enough to set aside the order of the lower appellate authority to that extent, although no specific ground is taken for that purpose by the concerned party - in a given situation, there is an obligation on the part of the Tribunal to consider the subject-matter of appeal and secondly to issue effective directions for adjudicating the subject-matter of appeal, which includes the entire process of assessment and which has been held to be an integrated process. Whether a mistake can be pointed out on the part of ITAT even when the assessee did not seek any relief from the Tribunal – Held that:- It is a mistake apparent from record, so that the order rectifying the mistake is valid- where the Tribunal passes an order taking into account information not disclosed to the assessee, there is a mistake apparent from the order so that Tribunal is duty bound in rectifying the mistake when it is brought to the notice of the Tribunal - while maintaining our order on the main issue with regard to allowability of deduction u/s 35(1) - the Tribunal order is to be amended to that extent and the Registry is directed to post the cases for hearing on 6.10.2014 for the limited purpose of deciding the issue on applicability of provisions of section 35(3) of the Act – Decided partly in favour of Assessee.
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