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2019 (9) TMI 258 - AT - Income TaxRectification u/s 154 - non reliance or consideration of binding decisions of the superior court while pronouncing an order / judgement - additional depreciation on plant and machinery was disallowed - whether the assessee is engaged in the business of manufacturing - HELD THAT:- Hon'ble Supreme Court in the case of CIT vs Gem India Mfg. Co. [2000 (12) TMI 7 - SUPREME COURT] has considered and decided this issue in respect of activity of cuttings and polishing of diamonds and it was held that said activity does not result new article or thing which can be held as manufacturing or production Thus once the issue is settled by the Hon'ble Supreme Court then it is a binding law for all the authorities including the AO. This is also an undisputed fact that allowing the claim of additional depreciation while passing the assessment order u/s 143(3), the judgement of Hon'ble Supreme Court was not considered. Therefore, the order passed by the AO without considering the binding of law laid down by the Hon'ble Supreme Court would amount an apparent mistake on record which can be rectified u/s 154 of the Act. The Hon'ble Supreme Court in the case of ACIT vs Saurasthra Katch Stock Exchange Ltd. [2008 (9) TMI 11 - SUPREME COURT] has held that non-consideration of a binding decision would render the Tribunal decision liable for rectification of mistake apparent from record. While considering the issue in the case of ITO vs Arihant Tiles & Marbles (P) Ltd. [2009 (12) TMI 1 - SUPREME COURT] has noted that the assessee in the said case was engaged in the activities which include excavation of marble blocks and processing of such blocks by cutting into tiles and thereafter processing the tiles in different shapes and sizes and polishing was held to be manufacture or production. Thus the process undertaken while manufacturing of tiles from the blocks of marbles is different than cutting and polishing of raw diamonds. Even otherwise the decision in the case of CIT vs Gems India Mfg. Co. ( [2000 (12) TMI 7 - SUPREME COURT was not at all referred or considered in the case of ITO vs Arihant Tiles & Marbles (P) Ltd. (supra), though both the decisions are passed by the same strength of Bench of Three Judges - Decided against assessee.
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