TMI Blog2010 (2) TMI 261X X X X Extracts X X X X X X X X Extracts X X X X ..... J.P. DEVADHAR JJ. Suresh Kumar for the appellant. Vikas Singh with Sashi Tulsiyam, Ms. Amrita Narayan, instructed by M/s. Sutapa Saha, for the respondent. JUDGMENT The judgment of the court was delivered by 1. Dr. D. Y. Chandrachud J.-Admit. 2. In exercise of its power under section 254(2) of the Income-tax Act, 1961, the Income-tax Appellate Tribunal has by its order dated January 15, 2007, recalled its earlier order dated August 31, 2006 and set aside an order passed by the Commissioner of Income-tax under section 263. The substantial question of law which arises before the court, in this appeal filed by the Revenue, is whether in the circumstances of the case, the impugned order falls within the parameters of the jurisdiction under section 254(2) of the Act ? 3. During the course of the assessment proceedings pertaining to the assessment year 2000-01, the assessee made a claim of deduction under section 80HHC. The Assessing Officer by an order dated March 25, 2003 computed the gross total income of the assessee at Rs. 32.19 crores, allowed a deduction under section 80HHC in the amount of Rs. 32.17 crores and computed the taxable income at Rs. 1.25 lakh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose of section 80HHC. The Tribunal noted that the decision of its Ahmedabad Bench in the case of Pratibha Syntex Ltd. v. Joint CIT [2002] 81 ITD 118 was cited before it. For the reasons which the Tribunal indicated in its judgment, it came to the conclusion that the aforesaid decision which was relied upon by the assessee was not relevant and that it could not be held that the Assessing Officer could have come to a conclusion in favour of the assessee on the basis of the decision. The Tribunal also held that the decision of the Mumbai Bench in the case of Pink Star v. Deputy CIT [2000] 72 ITD 137 did not directly pertain to the issue in question involving a DEPB licence and was, therefore, not relevant. 5. The assessee thereupon filed a miscellaneous application under section 254(2) for rectification. The Tribunal by its impugned order dated January 15, 2007, allowed the application and recalled its earlier decision dated August 31, 2006. While allowing the appeal filed by the assessee, the Tribunal set aside the revisional order passed by the Commissioner of Income-tax under section 263. The Tribunal held that when the assessment order was passed, there was no dispute as to w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initial proceedings of the appeal against the order under section 263, the decision was not dealt with and consequently, that could form the subject-matter of an application under section 254(2). 8. Section 254(2) empowers the Tribunal to rectify a mistake apparent from the record and for that purpose to amend any order passed by it. The Supreme Court has held in its judgment in Honda Siel Power Products Ltd. v. CIT [2007] 295 ITR 466 that the underlying purpose of section 254(2) is based on the fundamental principle that a party appearing before the Tribunal should not suffer on account of a mistake committed by the Tribunal. When prejudice results from an order attributable to the Tribunal's mistake, error or omission, it is the duty of the Tribunal to set it right and it has nothing to do with the concept of the inherent power to review. The Supreme Court held that the Tribunal would be regarded as having committed a mistake in not considering the material which is already on record. In that case, a decision of the Tribunal which was cited before it, had by oversight been overlooked in the judgment dismissing the appeal filed by the assessee on the question of the admissib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 254(2) is not a carte blanche for the Tribunal to change its own view by substituting a view which it believes should have been taken in the first instance. Section 254(2) is not a mandate to unsettle decisions taken after due reflection. The provision empowers the Tribunal to correct mistakes, errors and omissions apparent on the face. The section is not an avenue to revive a proceeding by recourse to a disingenuous argument nor does it contemplate a fresh look at a decision recorded on the merits, however appealing an alternate view may seem. Unless a sense of restraint is observed, judicial discipline would be the casualty. That is not what Parliament envisaged. 11. The Tribunal has also dealt with the decision of the Mumbai Bench in Crown Frozen Foods [2005] 93 TTJ 485 which does not materially place the matter beyond the earlier decision in Pratibha Syntex. In fact, the decision in Crown Frozen Foods records the submission of the assessee as having relied upon the decision of the Ahmedabad Bench in Pratibha Syntex. That apart, in Crown Frozen Foods, the Tribunal held that "on the given facts and circumstances of the case, it cannot be said that the order of the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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