2025 (5) TMI 1370 - AT - Service Tax

Application seeking rectification of mistake - Scope and limits of rectification powers of the Tribunal in relation to errors apparent on record - typographical error regarding the date mentioned in the final order - Whether non-consideration of a decision can be said to be a mistake apparent on record - HELD THAT - We observe that the issue stands decided by Hon ble Apex Court in Assistant Commissioner of Income Tax Vs. Saurashtra Kutch Stock Exchange Ltd.- 2008 (9) TMI 11 - SUPREME COURT wherein it has been held that the non-consideration of a decision is a mistake which can be set to be a mistake apparent from the record which could be rectified. In light of above decisions and perusing that both the decisions as referred in the application were submitted by the appellant additionally on 11.12.2023. However the final order has no mention about those decisions. Both the decisions need to be referred and discussed in the present judgment. In the light of above discussion following is the conclusion (1) Two case laws have been incorporated in para 5 of the Final Order No. 56012 of 2024 dated 10.07.2024; (2) Para 21(A) is added in the said final order incorporating the discussion about two decisions referred by the appellant however with the finding about non-applicability thereof to the fact and circumstances of the present case; (3) Date of final order is 10.07.2024 hence the same is not an error as alleged. The date may be checked in the uploaded order and if required the needful be done by the registry in terms of this order with reference to the application of the appellant seeking correction of date. As a result the present application is allowed partly.

Summary

The core legal questions considered in this judgment are:

(1) Whether the non-consideration of judicial decisions referred to by a party in a final order constitutes a "mistake apparent from the record" that can be rectified by the Tribunal;

(2) Whether a typographical error regarding the date mentioned in the final order amounts to a mistake apparent on record warranting correction;

(3) The applicability and relevance of the two judicial decisions cited by the appellant to the facts of the present case;

(4) The scope and limits of rectification powers of the Tribunal in relation to errors apparent on record.

Issue-wise Detailed Analysis

Issue 1: Non-consideration of judicial decisions as a mistake apparent on record

The Tribunal examined whether omission to consider judicial precedents submitted by the appellant in the final order amounts to a rectifiable mistake apparent on record. The legal framework guiding this issue is derived from the Supreme Court's ruling in the Assistant Commissioner of Income Tax Vs. Saurashtra Kutch Stock Exchange Ltd., which held that non-consideration of a relevant decision is a mistake apparent from the record and can be rectified. This principle was reiterated by the Allahabad Bench of the Tribunal in Schenck Rotech India Ltd. Vs. Commissioner of Customs, where failure to address grounds and decisions relied upon by the appellant without distinguishing them was held to be an error apparent on the face of the record.

In the present case, the appellant had submitted two decisions during the proceedings, but these were not referred to or discussed in the final order. The Tribunal found this omission to be a mistake apparent on record, justifying rectification. The Tribunal accordingly ordered incorporation of references to these decisions in the final order and added a new paragraph discussing their relevance.

Issue 2: Typographical error in the date of the final order

The appellant pointed out that the date mentioned in the final order was incorrectly recorded as 10.07.2014 instead of 10.07.2024. The Tribunal examined the record and found that the date 10.07.2024 was correctly recorded in the title portion of the final order. Hence, the alleged typographical error was not sustainable. However, the Tribunal directed the registry to verify the date in the uploaded order and make corrections if necessary to avoid confusion.

Issue 3: Applicability of the two judicial decisions cited by the appellant

The appellant relied on two decisions:

(i) Express Engineers & Spares Pvt. Ltd. Vs. Commissioner of CGST, which involved the supply of diesel generator sets on hire with transfer of control and possession, held to be a transfer of goods rather than a service;

(ii) SRF Ltd. (Chemical Business) Vs. Commissioner LTU, where contracts for leasing ISO tankers used for transportation of refrigerant gases were held to constitute deemed sale in the course of import, exempting the transaction from sales tax/VAT.

The Tribunal analyzed these precedents in the context of the present case involving transfer of cranes. It observed that unlike the cited cases, the effective control over the cranes was not transferred in the present transaction. The facts did not align with those in the cited decisions. Therefore, the Tribunal held that these decisions were not applicable to the facts and circumstances of the present case.

Additionally, the Tribunal considered two other decisions cited subsequent to the final order-M/s Koperteck Metals (P) Ltd. Vs. Commissioner and VOS Technologies India Pvt. Ltd. Vs. Commissioner-but found them irrelevant for extending any benefit to the appellant. The Tribunal noted that despite the legal issues discussed in those decisions, the appellant bore the onus to prove that the adjudicating authorities could pass the order within prescribed limits, which was not established.

Issue 4: Scope of rectification powers

The Tribunal reaffirmed its power to rectify mistakes apparent on the record, including non-consideration of relevant judicial decisions and typographical errors. The rectification was limited to incorporating references to the omitted decisions and adding a discussion paragraph analyzing their applicability. The Tribunal did not alter any substantive findings or conclusions of the final order beyond correcting these errors.

Significant Holdings

"The non-consideration of a decision is a mistake which can be set to be a 'mistake apparent from the record' which could be rectified."

"Where the grounds and the decisions relied upon by the appellant were not considered by the Tribunal nor there was any finding distinguishing the same, such mistake is held to be an error apparent on the face of the record."

"In Express Engineers (supra) it was the supply of diesel generator set on hire with transfer of control and possession over the said generator set. Accordingly, the activity was held to be transfer of goods as different from the service of supply of tangible goods."

"In SRF Limited (supra) case the appellant therein entered into the contracts with the foreign suppliers for obtaining ISO tankers on lease/rental basis which were used by the appellant for transportation of refrigerant gases via sea route. The transaction was held to be the deemed sale on the ground that the transaction involved sale or purchase of goods in the course of import of goods into India."

"Apparently none is the fact for the present case in the light of discussion arrived at above. It has already been observed that the effective control was not transferred while transferring the cranes."

"Both these decisions have been referred subsequent to pronouncement of the present order. Irrespective the decision talks about a legal issue but the onus was still upon the appellant to prove that it was possible for the adjudicating authorities to pass the order within the prescribed limits. Hence, we do not see any reason of extending any benefit of the said decisions to the appellant."

"The date of decision in the title part of the impugned final order is recorded as 10.07.2024 instead of 10.07.2014 as alleged in the present application. We hold that the error pointed out is not sustainable."

The Tribunal's final determinations were:

(1) The omission to refer to the two judicial decisions cited by the appellant in the final order was a mistake apparent on record and rectified by incorporating references and a detailed discussion paragraph;

(2) The two cited decisions were found not applicable to the facts of the present case, as the critical element of transfer of effective control was absent;

(3) The alleged typographical error in the date of the final order was not established, but registry was directed to verify and correct if necessary;

(4) The application for rectification was allowed partly, limited to the corrections discussed above without disturbing the substantive findings of the final order.