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2023 (9) TMI 424 - AT - Income TaxRectification of mistake - Levy penalty u/s 271AAC or u/s 270 - addition applying the GP rate of 26.63% on the declared turnover as against the GP rate of 25.38% declared by the assessee - HELD THAT:- CIT (A) has no power to issue direction in case where “no proceedings are pending” before him and thus in this way pendency of proceedings of proceedings is a sine quo non for passing any order by ld. CIT (A). Therefore, in view of the above legal provision, the action of the ld. CIT (A) for initiation of penalty proceedings under section 270A of the Act is not a rectification of order but a revision of appeal order earlier passed by his predecessor CIT (A) which is not permissible under the provisions of the IT Act. Therefore, the directions given by ld. CIT (A) for initiation of penalty proceedings u/s 270A of the Act and in this regard order passed under section 154 of the Act is palpably wrong, invalid and bad in law and without jurisdiction. There is a difference between rectification of an order and revision of an order. The rectification of any mistake can only be passed in order to put something right. However, revision means, the changing of something in order to correct or improve it. Thus, in our view, any change in the order can only be done by invoking the powers of revision and not by passing order of rectification u/s 154 of the Act. Since in the present case no proceedings are pending before the CIT (A), therefore, the ld. CIT (A) was not right in passing order of rectification by directing to initiate the penalty proceedings under section 270A of the IT Act in place of penalty proceedings u/s 271AAC of the Act when admittedly vide her initial order dated 28.02.2022 has categorically held that addition made on account of alleged unaccounted sale under section 68 is totally unjustified and consequently not covered u/s 115BBE of the Act and there was no income chargeable to tax under section 115BBE. After culmination of proceedings, the ld. CIT (A) was not within jurisdiction to order initiation of penalty proceedings under section 270A of the IT Act by passing rectification order under section 154 of the Act as the said action of CIT (A) is without jurisdiction and out of purview of the provisions of section 154 of the Act. Therefore, the same deserves to be quashed and set aside. Consequently, the appeal filed by the assessee stands allowed.
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