TMI Blog2011 (12) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... 2010 passed by the Income Tax Appellate Tribunal, "D" Bench, Chennai in M.P.No.20/Mds/2010 in I.T.A.No.1343/Mds/2008 and C.O.No.158/Mds/2008 in I.T.A.No.1343/Mds/2008 respectively. 2. The assessee is a charitable trust created vide Registered Trust Deed dated 10.09.1991. The trust is engaged in the activity of running educational institutions and it has been granted registration under section 12AA of the Income Tax Act by the Commissioner of Income Tax. For the assessment year 2003-04, the assessee trust filed its return of income on 15.12.2003 admitting "NIL" income, after availing income exemptions under section 10(23C) of the Act. The case was taken up for scrutiny and a notice under section 143(2) of the Act was issued to the assessee. The assessee was 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 ITR 280 relied upon by the Tribunal in the original order was very much on the issue raised? (c) Whether on the facts and circumstances of the case, the Tribunal was right in holding that there was no violation of the provisions of section 13(1)(c)(ii) of the Act by the assessee trust?" 4. We have heard the learned counsel appearing on either side and perused the entire materials available on record. 5. It is not in dispute that the assessee filed its return of income for the assessment year 2003-04 admitting "NIL" income, after availing exemptions under section 10(23C) of the Act. However, during the assessment proceedings, the Assessing Officer found that the assessee had advanced a sum of Rs.25 lakhs to Shri.P.V.Ravi, the Managing Trustee 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 indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d section, since no interest was charged and no security was obtained from the Managing Trustee, to whom the money was given for the so-called purchase of the property. The Tribunal also found that, even assuming for a moment that such transaction was genuine, the money was given without any agreement between the Trust and the Managing Trustee and so-called sellers and no interest was charged from the Managing Trustee. But, on the other hand, the assessee trust was paying heavy interest on its borrowings. On the basis of the above findings, the Tribunal, in its order dated 19.06.2009, while holding that the assessee had violated the provisions of section 13(1)(c)(ii) of the Act, set aside the order passed by the Commissioner of Income Tax (Appeals). 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 adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nar Educational Institution (supra) for adjudicating the issue regarding violation of section 13 of the Act. Whether non-consideration of the decision of the Hon'ble Supreme Court of India would constitute a rectifiable mistake, has been decided by the Supreme Court in the case reported in Asstt CIT v. Saurashtra Kutch Stock Exchange Ltd. [2008] 305 ITR 227/[2008] 173 Taxman 322. In that case, the Supreme Court has held as follows: "The core issue, therefore, is whether non-consideration of a decision of jurisdictional court (in this case a decision of the High Court of Gujarat) or of the Supreme Court can be said to be a "mistake apparent from the record"? In our opinion, both 'the Tribunal and the High Court' were right in holding that such a mistake can 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2011. It is submitted by the learned counsel appearing for the Revenue that the order passed by the Tribunal in the rectification petition amounts to re-opening the case once again and the miscellaneous petition itself is not maintainable and if at all the assessee is aggrieved, it should have filed an appeal before the High Court, instead of filing the miscellaneous petition under section 254(2) of the Act. In support of the said submission, learned counsel appearing for the Revenue relied upon the decision reported in Express Newspapers Ltd. v. Dy. CIT [2010] 320 ITR 12/186 Taxman 111 (Mad.). In that judgment, a Division Bench of this court, following the decision of the Hon'ble Supreme Court of India in the case reported in Saurashtra Kutch Stock Exchange 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 elab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent from the record is brought to the notice of the Tribunal, is based on the fundamental principle that no party appearing before the Tribunal, be it an assessee or the Department, should suffer on account of any mistake committed by the Tribunal. This fundamental principle has nothing to do with the inherent power of the Tribunal. If prejudice has resulted to the party, which prejudice is attributable to the Tribunal's mistake, error or omission and which error is a manifest error, then the Tribunal would be justified in rectifying its mistake. Rectification can be made only when a glaring mistake of fact or law committed by the officer passing the order becomes apparent from the record. The rectification is not possible if the question is debatable. A point 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 n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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