TMI Blog1998 (2) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... x Act ? 2. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is right in holding that the decision of the Supreme Court in Indian and Eastern Newspaper Society v. CIT [1979] 119 ITR 996, could not be followed in view of the earlier decision of the Supreme Court in R. K. Malhotra, ITO v. Kasturbhai Lalbhai [1977] 109 ITR 537 ? 3. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is justified in holding that rectification of their earlier order dated July 9, 1979, following the decision of the Supreme Court in Indian and Eastern Newspaper Society v. CIT [1979] 119 ITR 996, would have the effect of escapement of taxation and hence their order could not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion in the case of Indian and Eastern Newspaper Society v. CIT [1979] 119 ITR 996. That decision was rendered within a period of four years from the date of the order of the Tribunal in the assessee's case. The assessee approached the Tribunal once again with a n application for rectification which was filed on April 15, 1983. The Tribunal rejected that application on the ground that the law which it had applied at the time it made the order on the appeal was the law which then prevailed, and was binding on it and then the subsequent decision of the Supreme Court in the case of Indian and Eastern Newspaper Society [1979] 119 ITR 996, holding that the audit party could not interpret the law for the Assessing Officer but could only draw his a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nclusion that the Tribunal deciding a case on certain debatable issues, could not be deemed to have made a mistake because subsequent to the decision of the Tribunal a judgment has been rendered by the jurisdictional High Court. Counsel submitted that the Tribunal had rightly declined to entertain the application for rectification of mistake as there was in fact no mistake in the earlier order which needed rectification that order having been made in conformity with the law declared by the Supreme Court as on the date. Rectification should be of a mistake in the original order. The mistake can occur on account of omission to notice relevant facts or stating facts wrongly or omitting to take into account the law or applying the law in a ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowed or refused. If the result of allowing the application is to bring about a result which is manifestly unjust or contrary to the substantive provision of the Act, the Tribunal can in its discretion, decline to allow such an application for rectification of mistake. If, on the other hand, by allowing such an application, the Tribunal brings about the result which would be in accordance with the substantive charging provisions of the Act, such an exercise will have to be regarded as One which is a permissible exercise of power to rectify the mistake under' section 254(2) of the Act. The decision relied upon by counsel for the Revenue rests on the availability of the decision rendered by the jurisdictional High Court at the point of time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not entitled had been allowed. The effect of the reopening and the order made on the reassessment was in accordance with the provisions of the Act. The Tribunal had upheld the order of reassessment. If the effect of allowing the application for rectification of the Tribunal's order is to bring about the result which would not be in conformity with the requirements of section 57(iii) of the Act, the Tribunal, under the circumstances, cannot be held to have committed any error by declining to entertain the application for rectification of mistake in its own order. Our answer to the questions referred to us, therefore, is (i) that on the facts of this case, the Tribunal was right in rejecting the miscellaneous application filed by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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