TMI Blog2014 (7) TMI 417X X X X Extracts X X X X X X X X Extracts X X X X ..... e’s appeal against the rectification order would, therefore, stand to be considered only as an appeal against an assessment order. Not doing so would leave the assessee remedy less and for no fault of its’. In-as-much as rectifying a mistake would fall within the inherent powers of the court or tribunal, it could also be contended that the rectification is not constrained on account of the time limitation that attends a rectification u/s 254(2) - if only to cause the removal of the prejudice, apart from other persuasive reasons, it is only proper to conclude that the tribunal had restored the matter qua Adjustment ‘B’ also back to the AO - thus, the matter is remitted back to the TPO and allowance of proper opportunity to the assessee – Decided in favour of Assessee. - I.T.A. No. 1960/Mum/2013 - - - Dated:- 25-6-2014 - Shri Sanjay Arora, AM And Dr. S. T. M. Pavalan, JM,JJ. For the Appellant : Shri M. P. Lohia For the Respondent : Shri Pitambar Das ORDER Per Sanjay Arora, A. M.: This is an Appeal by the Assessee arising out of the Order by the Commissioner of Income Tax (Appeals)-15, Mumbai ( CIT(A) for short) dated 20.12.2012, dismissing the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence that how the amount is received as full rate and not of the rate of idle condition. Nothing has been brought on record that there was some intention between the parties to avoid the tax burden. Therefore, in view of these facts and circumstances and to meet the end of justice we are of the considered view that matter should go back to the file of the Assessing Officer to decide it afresh after affording proper opportunity to the assessee. We order accordingly. 6. The issue with regard to repair expenses is also restored to the file of the Assessing Officer to reconsider afresh after affording proper opportunity to the assessee. We order accordingly. The assessee being in dredging business, earning income through hire of vessels, the principal adjustments made in its case were on account of lease rentals for dredgers Gemini and Multicat Coby (MC), at ₹ 307.29 lacs and ₹ 105.02 lacs respectively, the two vessels having been hired to associate concerns. The matter was accordingly referred by the A.O. to the TPO who, however, revisited the adjustment only with regard to Dredger Gemini (DG), declining to interfere with the adjustment qua MC, as in his view t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 54 is, thus, unwarranted and without jurisdiction. On being questioned by the Bench if the A.O. could possibly transgress the direction by the TPO u/s.92CA(3), the ld. AR would take us to the provision of section 92CA(4) as it stood prior to its substitution by Finance Act, 2007 w.e.f. 01.06.2007, contrasting the change effected. The matter had been considered by the Special Bench of the tribunal in Aztec Software Technology Service Ltd. vs. ACIT [2007] 107 ITD 141 (Bang)(SB) (a copy of the said order, it was submitted, would be placed on record in due course, and which was done by the assessee vide its letter dated 11.06.2014), so that the binding nature (on the A.O.) of the direction by the TPO u/s.92CA(3) is only w.e.f. 01.06.2007, while earlier the A.O. had to frame the assessment only by having regard to the arm s length price as determined by the TPO. On being questioned that while para 5 of the tribunal s order for the current year is in respect of the adjustment qua lease rentals for DG; the assessee admitting to having furnished additional evidence/s only with regard thereto, para 6 thereof is in respect of repairs only, for which a separate adjustment (at ₹ 65.91 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y directed by the TPO vide his order u/s.94CA(3) r/ws. 254 (copy not placed on record by the assessee). The only possible inference that follows therefrom is of the TPO confirming his earlier order qua the said adjustment. The A.O., thus, in allowing relief to the assessee in respect of the said adjustment, had acted without any basis, legal or factual. This also explains the assessee s initial acceptance of the withdrawal of relief in its respect u/s.154 proceedings, and which forms the basis of the dismissal of its objection thereto raised subsequently in appeal, by the ld. CIT(A). The question is not of the binding or otherwise nature of the TPO s direction/s u/s.92CA(3), but of the A.O. having acted de hors and in the absence of any such direction. The TPO having rightly or wrongly not revised his earlier direction u/s.92CA(3) dated 15.02.2005 pursuant to that by the tribunal dated 30.08.2006, the A.O. could not have acted suo motu in firstly disregarding the understanding of the tribunal s order by the TPO and, then, deciding the issue on merits in-as-much as the tribunal had abstained from doing so, and had only, if at all, restored the matter qua the said adjustment (Adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... though mutually reinforcing reasons. Firstly, the Revenue has, for the immediately succeeding year, following the same order, itself considered it as so (vide order u/s. 92CA(3) r/w s. 254 dated 30.10.2009/PB pgs. 122-129). It is, thus, not open for the A.O. to take a contrary view qua the same order. Two, it is not the case of either party that the tribunal had not disposed of the assessee s appeal completely, so that the direction qua repairs also includes that qua Adjustment B in-as-much as the inclusion or exclusion of R + M (repairs and maintenance) component was a relevant aspect in deciding the same. Thirdly, the only implication of non-disposal by the tribunal of the assessee s appeal qua Adjustment B is that a mistake had occurred at the end of the tribunal. It is trite law that a court or tribunal cannot, by its action or non-action, cause prejudice to any party before it. This would be particularly so in the present case as the period of four years (from the end of the relevant financial year) has since lapsed. In fact, in-as-much as rectifying such a mistake would fall within the inherent powers of the court or tribunal, it could also be contended that the rectific ..... X X X X Extracts X X X X X X X X Extracts X X X X
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