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TMI Blog1972 (12) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... lowed 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 issued under section 46(2) was cancelled on May 30, 1963. The Assistant Controller of Estate Duty came to know of this settlement of the amount due from the deceased at Rs. 30,000 some time in January 1966. By that time the Assistant Controller also found that the correct amount of double income-tax relief due to the assessee was Rs. 17,346. Thereupon o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 ? " After the disposal of the appeal by the Tribunal the petitioner filed the writ petition praying for a writ of certiorari on the ground that the Tribunal had held that no appeal lay against the order under section 61 ,and, therefore, the only remedy available for him was to invoke the jurisdiction of this court under article 226 of the Constitution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity 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 during the five years relevant to the assessment years 1942-43 to 1946-47 against the profits of assessment years 1942-43 and 1941-42. While this was so, the Malayan Government, passed an Ordinance in 1948 scaling down the debts incurred during that period. The income-tax department contended that the assessees having, opted to accept the scheme derived ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 amount payable by the deceased and there is no question of any amount being left out of that settlement and kept for enforcement at the option of the Government at a future date. We are of opinion that the Government would be estopped from contending that any further amount was due from the deceased on account of income-tax and excess profit tax. It was nex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevant 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. But it is open to the Income-tax Officer (under section 35 of the Indian Income-tax Act, 1922) to examine the record including the evidence and if he discovers any mistake he is entitled to rectify the error : vide Maharana Mills (Private) Ltd. v. Income-tax Officer. Having laid down these tests, the Supreme Court also struck a note of warning in Satyanarayna Laxmin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous 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 jurisdiction begins and where it ends. One thing, however, emerges from the discussion above. The essence of rectification is to bring the order which was expressed and intended to be in pursuance of the existing law, into harmony with such law. It presupposes a particular state of affairs and it requires proof that by such a mistake the final order fails to give proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l 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 that particular proceeding. But it all depends cn the wording of the particular authorisation given and will have to be decided as a question of fact in each case. In this case we find that the chartered accountants represented the petitioner in the previous two rectification proceedings, and each ended in the revised order, dated April 14, 1961, and October 13, 1974. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 from the date of the original order as the limitation for rectification. It is in those circumstances that the Assistant Controller fixed the date for hearing as January 25, 1966, but the chartered accountants requested for time till February 15, 1966, which certainly could not have been complied with. Having regard, to the time available, the subject-matter of the rect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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