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TMI Blog2011 (12) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... represented by an authorised Chartered Accountant. During the course of assessment proceedings, the Assessing Officer found that the assessee had advanced a sum of Rs.25 lakhs to the Shri.P.V.Ravi, who is the Managing Trustee of the assessee trust. Since this amounted to violation of section 13 of the Act, the assessee was asked to explain as to why the exemption claimed under section 11 of the Act should not be denied. It was explained that advance was made by the assessee for the purpose of purchase of property for the trust and hence, there was no violation of the provisions of section 13 of the Act. However, the Assessing Officer, was not persuaded with the explanation offered. Therefore, he denied the exemption under section 11 of the Act to the assessee and thus completed the assessment on 31.03.2006. Challenging the said assessment order, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) in I.T.A.No.45/06-07 and the Commissioner, by order dated 31.03.2008, allowed the appeal filed by the assessee and directed the Assessing Officer to grant exemption under section 11 of the Act to the assessee. As against the same, the Revenue filed an appeal before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee trust, which was in violation of section 13 of the Act. Therefore, the assessee was asked to explain as to why the exemption claimed under section 11 of the Act should not be denied to the assessee. The assessee explained that in the current year no funds were given by the trust to Shri.P.V.Ravi; the transaction related to the previous year; Shri.P.V.Ravi gave a sum of Rs. 25 lakhs to Shri.S.K.Senthilkumar from his individual account during the financial year ending 31.03.2002 for purchasing a property for the trust; since property could not be purchased before the end of that year, a journal entry was made in the books of the trust by showing it as a debit balance and by crediting the account of Shri.P.V.Ravi on 31.03.2002; due to litigation in the property, it could not be purchased and the amount of advance was returned back by Shri.S.K.Senthilkumar to Shri.P.V.Ravi during the year 2003-04; as Shri.P.V.Ravi received back his money during the current year from Shri.S.K.Senthilkumar, a reverse entry was made in the books of accounts of the trust on 31.03.2003 and therefore, there was no outflow of cash from the trust. On the basis of the above materials available ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. The assessee trust filed a petition before the Tribunal under section 254(2) of the Act to rectify the mistake committed by the Tribunal in passing the order dated 19.06.2009 on the ground that, the Tribunal, while deciding the appeal filed by the Revenue, did not consider the decision of the Hon'ble Supreme Court of India in the case reported in Aditanar Educational Institution v. Addl. CIT [1997] 224 ITR 310/90 Taxman 528 for adjudicating the issue regarding violation of section 13 of the Act. According to the learned counsel appearing for the Revenue, the Tribunal ought not to have reviewed the original order passed by it that the assessee had violated the provisions of section 13(1)(c)(ii) of the Act and as per the provisions of section 254(2) of the Act, the conclusion arrived at by the Tribunal cannot be reviewed, especially when the Assessing Officer had found that though the transaction took place in the previous year relevant to the assessment year 2002-03, the advance amount of Rs. 25 lakhs was shown as outstanding vide Schedule 14 to the balance sheet in the name of the trustee as on 31.03.2003 and as per section 13(2)(a) of the Act, if any part of the income or prope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an be said to be a "mistake apparent from the record", which could be rectified under section 254(2)." 9. From the above, it is clear that if there is a mistake apparent on record, the Tribunal has the power to rectify the said mistake in the petition filed under section 254(2) of the Act. In this case, admittedly while passing the earlier order, the Tribunal did not consider the decision of the Hon'ble Supreme Court of India in the case reported in Aditanar Educational Institution (supra) for adjudicating the issue regarding violation of section 13 of the Act. Therefore, in the petition filed by the assessee for rectification of the said mistake, the Tribunal, after taking into account the fact that the claim of the assessee was on the basis that during the current year no part of income of the trust was utilised or applied either directly or indirectly for the benefit of any specific person; the earlier order was passed on the basis that advance of Rs.25 lakhs was given during the period 01.04.2001 to 31.03.2002, which was not the previous year relevant to the assessment year in question and also taking into account the decision of the Hon'ble Supreme Court of India in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ltd. (supra) as well as various other decisions of the Supreme Court and other courts, has held as follows: "The scope and amplitude of section 254(2) and the analogous provision of section 154 of the Act have been considered by a catena of decisions of the Apex Court and other High Courts. The uniform opinion of the courts of superior jurisdiction is that a patent, manifest and self-evident error which does not require elaborate discussion of evidence or argument to establish it, can be said to be an error apparent on the face of the record and can be corrected under section 254(2). An error cannot be said to be apparent on the face of the record if one has to travel beyond the record to see whether the judgment is correct or not. An error apparent on the record means an error which strikes one on mere looking and does not need a long drawn out process of reasoning on points on which there may be conceivably two opinions. The error should not require any extraneous matter to show its incorrectness. To put it differently, it should be so manifest and clear that no court would permit it to remain on record. If the view accepted by the court in the original judgment is one of poss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t which was not examined on facts or in law cannot be dealt with as a mistake apparent from the record. No error can be said to be apparent on the face of the record if it is not manifest or self-evident and requires an examination or argument to establish it. Where without any elaborate argument one could point to the error and say here is a substantial point of law which stares one in the face, and there could reasonably be no two opinions entertained about it, is a clear case of error apparent on the face of the record." 11. In view of the said submissions made by the learned counsel appearing on either side, once again, we perused the entire materials available on record, in the light of the decisions of the Hon'ble Supreme Court of India referred to above and also the other decisions of the Hon'ble Supreme Court and referred to by the Division Bench of this Court in the case reported in Express Newspapers Ltd. (supra), to find out whether the Tribunal has committed any error in rectifying the earlier order passed by it on the ground that there was an error apparent on the face of the record and we found none. Section 254(2) of the Act has been enacted not only to safeguard th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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