TMI Blog1972 (12) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of the estate of the deceased. The estate duty assessment was made by the Assistant Controller of Estate Duty on January 30, 1961, under section 58(3) of the Act determining the net principal value of the estate at Rs. 4,80,419 and the duty payable at Rs. 48,162. In arriving at this principal value of the estate, a sum of Rs. 1,46,506 was allowed as a deduction on account of the deceased's income-tax and excess profits tax liabilities. The Assistant Controller has also noted at the foot of the order that the correct amount due to the deceased as double income-tax relief was not known and that the assessment would be revised later on this score. This assessment was revised twice under section 61 on April 14, 1961, and October 13, 1964, for reasons which are not relevant for the purpose of these proceedings. On the representations made by the accountable person, which will be dealt with in detail at a later stage, the Income-tax Officer settled the amount due from the deceased at Rs. 30,000 and this amount was accepted by the petitioner and paid in full settlement of the income-tax and excess profits tax and other arrears due from the decesod. Thereupon, the certificate iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iction. The Appellate Controller overruled both the objections. He also held that no appeal lies to him against an order under section 61. The petitioner preferred a further appeal to the Tribunal. By an order dated January 20, 1969, the Tribunal held that section 61 of the Act was properly invoked and section 59 was not applicable. It also hold that the facts disclosed a " mistake apparent from the record " giving jurisdiction to the Assistant Controller to correct the mistake. It further held that there was no appeal against the order of the Assistant Controller made under section 61. The order of the Tribunal concluded by stating that " no other points are pressed before us " and the appeal was dismissed. The petitioner filed an application before the Tribunal to delete the last sentence in the order which stated that "no other points are pressed before us" on certain grounds which will be noted later. That petition was dismissed. Then, at the instance of the petitioner, the Tribunal referred the following question under section 64(1) of the Act : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the appeal was incompetent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icate issued under section 46(2) was withdrawn on May 30, 1963. The contention of the petitioner is that this settlement or reduction of the tax arrears was not one under any statutory provision of the Income-tax Act or the Rules framed thereunder and that it amounted to only an ex gratia reduction with no legal consequences, and that the original liability so to say, could still be enforced as the Government could not be said to be bound by this settlement. In this connection, he relied on the decisions in Commissioner of Income-tax Y. V. MR. P. Firm, Muar H. H. Maharaja Rana Hemant Singh v. Commissioner of Income-tax and Mathra Parshad Sons v. State of Punjab. These decisions do not support the contention of the learned counsel for the petitioner. In Commissioner of Income-tax v. V. MR. P. Firm, Muar, the facts were these. In order to give relief to the Indian nationals who were carrying on business in Malaya and who were put in a peculiar stituation due to the Japanese occupation of that territory from February, 1942, to September, 1945, Government propounded a scheme to which the assessees in that case opted. The scheme allowed set-off of losses incurred by the assessees du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner. This settlement was also given effect to by the petitioner paying a sum of Rs. 30,000 and the department withdrawing the certificates issued under section 46(2). In the foregoing circumstances, we do not think that it would have been open to the department to claim any further sum than that of Rs. 30,000 already received as due from the deceased. We, therefore, do not agree with the learned counsel for the petitioner that the department was under no legal obligation not to enforce their claim for payment of the balance of the amount over and above Rs. 30,000 already received. The learned counsel for the petitioner also relied on the decision of the Supreme Court in Bombay Dyeing and Manufactures Co. Ltd. v. State of Bombay,where the court had pointed out the difference between discharge or extinguishment of a debt and the remedy to recover the debt being barred by limitation. It was pointed out therein that under law a debt subsists notwithstanding its recovery is barred by limitation. We are unable to accept that this principle could be invoked on the facts and circumstances of this case. The settlement or compounding, or whatever it may be called, determined what was the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid above, it is clear that the question whether section 17(1) of the Indian Income-tax Act, 1922, was applicable to the case of the 1st respondent is not free from doubt. Therefore, the Income-tax Officer was not justified in thinking that on that question there can be no two opinions. It was not open to the Income-tax Officer to go into the true scope of the relevant provisions of the Act in a proceedings under section 154 of the Income-tax Act, 1961. A mistake apparent on the record must be an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on Which there may conceivably be two opinions." It was therefore held that the Income-tax Officer was wrong in holding that there was a mistake apparent from the record. A number of cases were cited at the Bar on the question as to the exact content of the words "mistake" and "mistake apparent from the record". In Master Construction Co. (P.) Ltd. v. State of Orissa the Supreme Court observed that an error which is apparent on the face of the record should be one which is not an error which depends for its discovery on elaborate arguments on questions of fact or law. Bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to find it out. But that by itself is not the test to discountenance it as being not a mistake apparent from record. In the ultimate analysis, the conclusion a well equipped and trained judicial mind will reach after scrutinising the record will govern and his finding whether it is a mistake or not has to be accepted . On a fair conspectus of the ratio of the various decisions of this court and the Supreme Court, it is now clear that for a rectification of an error which is said to be apparent from the face of the record, the mere complexity of the problem or that genuine argument is necessary to discover the same may not by themselves be sufficient to oust the jurisdiction of a tribunal to rectify such a mistake. If however it could be discerned with some precision after a fair probe into the assessment records and a reasonable and probable conclusion can be arrived at, that the court's conscience has been shaken, in that there appears an error on record which has to be certainly corrected, then it would appear that the jurisdiction of the Tribunal vesting with power to rectify such mistake arises. As had been repeatedly pointed out, it is very difficult to state where the jur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,506 in the original order of assessment. Therefore, there had been a mistake in the assessment which the Assistant Controller was entitled to rectify under section 61 of the Act. On the question whether the petitioner as accountable person has been given a reasonable opportunity of being heard in the matter as required by the proviso to section 61, the learned counsel advanced two-fold arguments. The first was that his client did not receive any notice in person and the chartered accountants on whom the notice was served had no authority to represent the petitioner in the rectification proceedings. Secondly, even on the assumption that notice was properly served on the chartered accountants of the petitioner, there was no reasonable opportunity given to them for filing the objections. On the first part of the contention, it was submitted by the learned counsel that the authorisation given by the petitioner to the chartered accountants expired and exhausted immediately the original assessment order was made on January 30, 1971, and thereafter they had no authority to represent the petitioner. It is true that normally the authorisation given is only for the purpose of conducting t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner wants to take advantage of that and reagitate the same question. It is also to be remembered that the entire proceedings including the rectification proceedings were before the same authority and not an appellate or different authority and when an authorisation was given in as wide a term as noted by the Appellate Controller it could be easily presumed that the chartered accountants were given authority to represent the petitioner in the rectification proceedings also. This is especially so because the petitioner is a citizen of Ceylon and is a resident of that country. Having regard to these facts we are satisfied that the chartered accountants had the necessary authority to receive the notice and represent the petitioner in the rectification proceedings. The plea of lack of reasonable opportunity also, in our opinion, in the circumstances of the case, could not be accepted. The petitioner knew fully well about the settlement of the amount, due from the deceased at Rs. 30.000. The notice actually was served on the chartered accountants on January 19, 1966. The rectification would have to be made before January 30, 1966, as section 61 has prescribed a period of 5 years ..... X X X X Extracts X X X X X X X X Extracts X X X X
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