TMI Blog2012 (11) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... f the mistake is brought to its notice'. Clearly, if there is a mistake, then an amendment is required to be carried out in the original order to correct that particular mistake. The provision does not indicate that the Tribunal can recall the entire order and pass a fresh decision - The power to rectify a mistake under s. 254(2) cannot be used for recalling the entire order. No power of review has been given to the Tribunal under the IT Act. Thus, what it could not do directly could not be allowed to be done indirectly - no infirmity in the order of the Tribunal and the petition filed by the assessee cannot be said to be falls under the purview of section 254 - against assessee. - IT APPEAL NOs. 1220 TO 1236 (HYD.) OF 2009, M.A. NOs. 139 TO 155 (HYD.) OF 2010 - - - Dated:- 21-9-2012 - CHANDRA POOJARI AND SMT. ASHA VIJAYARAGHAVAN, JJ. A.V. Raghuram for the Appellant. Smt. Amisha S. Gupt for the Respondent. ORDER Chandra Poojari, Accountant Member - All these miscellaneous applications filed by different assessees are seeking rectification in the order of the Tribunal dated 30th April 2010 wherein the Tribunal confirmed that there is valid service of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... behalf. Therefore, the notice served on the person who is a GPA holder of the assessee and who has actually received the notice cannot be said to be invalid." 5. Further he submitted that having observed thus the Tribunal holds that there should be valid service of notice and it should be served in terms of code of CPC, and the mere fact that the recipient representing the assessee would not be sufficient to hold that he was authorised to receive notice. The observations of the Tribunal extracted above are contrary to each other. Another mistake is not considering the submission that the address mentioned in the notice cannot be said to be that of non-residence, since it is business address and not residential address. 6. On the other hand, the learned DR submitted that there is no mistake apparent on record which warrants recall of the order of the Tribunal. She relied on the decision in the case of V.T. Somasundaram v. ITO [1999] 70 ITD 398 (Chennai) wherein it was held as follows: "Held, It was not the case of the assessee that there had been glaring and patent mistake either of facts or law committed by this Tribunal. The grievance of the assessee was that each and every ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... settled and a trite law that power to review is a specific power which has to be conferred specifically by the legislature and it cannot be inferred as ancillary or inherent to the appellate jurisdiction. The Tribunal is a creature of the Income-tax Act, and it is well-settled legal proposition that the Tribunal has no inherent power of reviewing its order on merits though it has incidental or ancillary powers which can be exercised in order to make the appeal effective. But such power cannot be invoked to re-hear a case on merits. Once an order is passed under section 245(1), the Tribunal become functus officio subject to the provisions of section 256(1). It can hear an application under section 254(2) only to rectify a mistake apparent on record and not for review of its order. The Supreme Court in the famous case of Patel Narshi Thakershi v. Pradyumansinghji Arjunsinghji AIR 1970 SC 1273 have laid down that the power to review is not an inherent power but has to be conferred by law either specifically or by necessary implications. It, there/ore, does not stand to reason that if the power of review is not with the Tribunal, it can nonetheless exercise such a power indirectly i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e power of review unless such power is expressly conferred. There was no express power of review conferred on the Tribunal. Even otherwise, the scope of review did not extent to rehearing a case on the merits. Neither by invoking inherent power nor the principle of mistake of court not prejudicing a litigant nor by involving doctrine of incidental power, could the Tribunal reverse a decision on the merits. The Tribunal was not justified in recalling its previous finding restoring the addition, more so when an application for the same relief had been earlier dismissed." 9. The scope and ambit of application of section 254(2) is very limited. The same is restricted to rectification of mistakes apparent from the record. We shall first deal with the question of the power of the Tribunal to recall an order in its entirety. Recalling the entire order obviously would mean passing of a fresh order. That does not appear to be the legislative intent. The order passed by the Tribunal under s. 254(1) is the effective order so far as the appeal is concerned. Any order passed under s. 254(2) either allowing the amendment or refusing to amend gets merged with the original order passed. The orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es apparent from the record. (b) Secondly, that no party appearing before the Tribunal should suffer on account of any mistake committed by the Tribunal and if the prejudice has resulted to the party, which prejudice is attributable to the Tribunal's mistake/error or omission, and which an error is a manifest error, then the Tribunal would be justified in rectifying its mistake. The "rule of precedent" is an important aspect of legal certainty in the rule of law and that principle is not obliterated by s. 254(2) of the Act and non-consideration of precedent by the Tribunal causes a prejudice to the assessee. (c) Thirdly, power to rectify a mistake is not equivalent to a power to review or recall the order sought to be rectified. (d) Fourthly, under s. 254(2) an oversight of a fact cannot constitute an apparent mistake rectifiable under the section. (e) Fifthly, failure on the part of the Tribunal to consider an argument advanced by either party for arriving at a conclusion is not an error apparent on record, although it may be an error of judgement. (f) Sixthly, even if on the basis of a wrong conclusion the Tribunal has not allowed a claim of the party it will not b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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