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2017 (2) TMI 1374 - HC - Income TaxRectification of mistake - application under Section 254(2) - alternate remedy of appeal under Section 260A - Held that:- We find that Court has clearly observed that an appeal under Section 260A does not lie merely on rejection of an application which does not decide substantial issue involved between the parties but pre-condition is that a substantial question of law must have arisen. If no substantial question of law arisen, no appeal would lie under Section 260A of Act, 1961. Referring to a Division Bench judgment of Bombay High Court in Chem Amit vs. Assistant Commissioner of Income Tax (2004 (11) TMI 24 - BOMBAY HIGH COURT), Court observed that if an application under Section 254(2) is allowed mistake is rectified in original order, it amounts to an order passed under Section 254(1) against which appeal would lie. Court, in para 15 of the judgment, in fact, has said that appeal under Section 260A would not lie where application for rectification under Section 254(2) is rejected for the reason that such order cannot be treated to be an order passed in appeal by Tribunal but where order passed in appeal is recalled, it is an order passed in appeal and, therefore, in our view, appeal would be maintainable. Aforesaid judgment of Madras High Court also does not help Assessee in this case. Aforesaid judgment shows that an appeal under Section 260A would lie against an order of Tribunal if a substantial question of law has arisen and for that purpose it would not be material whether it is a judgment deciding appeal or otherwise. Moreover, if an order is passed on an application under Section 254(2) so as to recall the judgment of Tribunal which is otherwise final and referable to Section 254(1) and (4), it would be an order where against appeal would lie under Section 260A but the pre-condition is that there must have been arisen a substantial question of law. In taking the above view we are fortified with some authorities, as may be referred, hereinbelow. In view of above discussion we are of the view that ITA filed against judgment and order dated 05.12.2008 passed under Section 254(2) recalling orders dated 18.07.2008 and 21.09.2007 is maintainable.
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