TMI Blog2018 (6) TMI 446X X X X Extracts X X X X X X X X Extracts X X X X ..... aspect which has not influenced the decision making processing. Cognizance of the written submission - Held that:- Nothing new is contained in the submissions. It is not something, which if excluded, would change the result or impacted the assessee adversely - thus we are of the view that arguments of the assessee in this respect are devoid of any merit because alleged submissions was one fold of contentions amongst others, and not some discovery of new facts. Failure to take cognizance of various loose papers found at the time of search - Held that:- Assessee is trying to point out very minor apparent error i.e. observation of the Tribunal that diary has a single entry ledger account - we do not see that reference to such small aspects would have bearing on the decision making process - these aspects are not to be looked into in a proceeding u/s 254(2) - we are of the view that the assessee has tried to get the order of the Tribunal reviewed in the garb of pointing out apparent mistake, which is not permissible in law - thus we do not find any apparent mistake in the order of the Tribunal - hence both the MAs. are dismissed. - Misc. Application No.02 and 03 /Ahd/2015 IN IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (b) An order on appeal would consist of an order made unders. 254(1) of the Act or it could be an order made under sub-s. (1) as amended by an order under sub-s. (2) of s. 254 of the Act; (c) The power of rectification is to be exercised to remove an error or correct a mistake and not for disturbing finality, the fundamental principle being that power of rectification is for justice and fair play; (d) That power of rectification can be exercised even if a mistake is committed by the Tribunal or even if a mistake has occurred at the instance of party to the appeal; (e) A mistake apparent from record should be self-evident, should not be a debatable issue, but this test might break down because judicial opinions differ and what is a mistake apparent from the record cannot be defined precisely and must be left to be determined judicially on the facts of each case; (f) Non-consideration of a judgment of the jurisdictional High Court would always constitute a mistake apparent from the record, regardless of the judgment being rendered prior to or subsequent to the order proposed to be rectified; (g) After the mistake is corrected, consequential order must follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d lastly that there should not be any scope of profiteering by the contributors from a fund made by them which could only be extended or returned to themselves. In this way, the Tribunal held that principle of mutuality would not apply in the case of assessee and dismissed its appeal. The assessee thereafter filed MA pointing out apparent error in the order of the Tribunal. This MA was allowed and order of the Tribunal was recalled. Dissatisfied with the order of the Tribunal, the Revenue went in appeal before the Hon ble High Court and the Hon ble High Court set aside the order of recall and restored the original one. It is imperative upon us to take the following finding of the Hon ble High Court: 4. In the present case, as noted the Tribunal had given detailed reasons for coming to the conclusion that the principle of mutuality would not apply. While accepting the assessee's rectification applications, the Tribunal undertook equally painstaking and elaborate consideration of the very same issues and very same facts to come to a contrary conclusion. It is not necessary nor possible for us to hold whether the Tribunal's first view was correct or the subsequent one. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ject matter before us in the present tax appeal. The relevant question is, could the Tribunal have exercised the power of rectification to recall such judgement? The answer being obvious, is in the negative. The powers of rectification flowing from Section 254(2) of the Act are for correcting apparent errors and not for re-examination of the issues already considered and concluded. It is well recognised that the powers of rectification cannot be equated to that of review. The Tribunal thus travelled far beyond its power of rectification in accepting the assessee's various contentions which were not confined to pure factual errors apparent on the record. Some of the contentions of the assessee were highly contentious legal issues. Once the Tribunal had taken a particular view, it was always open for the aggrieved party to challenge such views before the higher court. The Tribunal could not have been persuaded to re-examine the issues on the premise that there was an error apparent on the record. 8. In the MA, the assessee has made reference to the decision of Hon ble Gujarat High Court in the cases of Mercury Metals P.Ltd. Vs. ACIT, and Rameshchandra M. Luthra, 257 ITR 297/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eized records. I have also gone through the remand reports and the submissions of the appellant on the remand report, as reproduced herein above. It is an undisputed fact impugned diary being Annexure A-l has been found during the course of search, from the residence of Shri Arvind Shah, appellant's accountant. Apart from the diary, there are other various loose papers also, which has been found from the residence of Shri Arvind Shah, which has direct link with the notings in the said diary, on the basis of which, the A.O. has made the addition. (v) Conclusion : 1) Hon'ble ITAT has wrongly drawn that Ld.CIT(A) has overlooked the statement recorded u/s 132(4). 2) The presumption u/s 132(4) is applicable in case of Arvind Shah as said diary was found from the possession of Arvind Shah and not from the appellant Jivraj V. Desai. 3) Therefore, Hon'ble ITAT on page 39 in para 8.11 has wrongly drawn the presumption in case of Jivraj V. Desai presuming that the said diary has been found from the possession of Jivraj V. Desai whereas the said diary was found from the possession of Arvind Shah. 2. (i) Issue : No discussion about the amount of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e been filed by D.R. in para No.5.1 was not made available to the A.R. of the appellant. 4. (i) Issue : Finding of the Hon'ble ITAT, is contrary to the findings recorded bv the AO. (ii) Observation of Hon'ble ITAT : The Hon'ble ITAT on page No. 28 in para-8 has observed: The diary has single entry ledger account of various sharafi business related parties . (iii) Observation in Asst. Order : On page 29 of the assessment order in para 2, AO while analyzing the transaction found recorded in the Diary A-l has recorded the following findings: The accounts/transactions in the diary are not purely sharrafi in nature. The same are classified in three categories as under: a) Transactions/accounts pertaining to Thaltej land deal, b) Other Sharafi transactions/accounts with debit balances/entries including miscellaneous accounts. c) Sharafi transactions/accounts with credit balances/entries . (iv) Observation in CIT(A) s Order : (v) Conclusion : The said finding of the Hon'ble ITAT is contrary to the finding of the A.O. as pointed out during the course of appeal argument and specifically vide para No.3.5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 30, 31, 32, 49 to 52 74 A-3 Page 1 A-3 Page 7 8 A-4 Page 91 A-3 Page 2 Conclusion: In this respect, attention is drawn to the elaborate arguments which has taken placed during the course of appeal hearing by the A.R. wherein attention was drawn to the fact that several Remand Reports were sought by the CIT(A) from the A.O. but none of the observation of the A.O. in the Remand Report has been considered by the Hon'ble Tribunal. The only two statements recorded u/s 132(4) and 131 has been considered and reference to various loose papers of Annexure A-3 and A-4 as made by the CIT(A) in para No.5.12 of the Order of the CIT(A) has altogether been ignored. Therefore, the said finding is contrary to the records and findings of the CIT(A) 7. (i) Issue : That the assessee has not discharged onus relating to 9 ledger accounts in the Diary A-l. (ii) Observation of Hon'ble ITAT : Hon'ble ITAT on page 36 in para 8.9 in the beginning part has discussed the issue relating to the 9 ledger accounts of the diary A-l and observed that assessee was granted several opportunities to produce those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orities that Thaltej land has been taken as security by the appellant for his financing business; rather issue before both the lower authorities was that the Diary inter alia includes transactions relating to the Thaltej land in which appellant was not involved as per documentary evidence in the form of MOU dated 5/7/1998. Therefore, the CIT(A) after co- linking the various other seized material with the amount noted in the dairy has deleted the addition, by observing as under in para No.5.12, as considered by ITAT in para No.4.5: 5.12 Therefore, the contention raised by the appellant during the course of appeal hearing was very much available before the Assessing Officer in the statement recorded by, still Assessing Officer in the statement recorded by, still Assessing Officer has preferred to make the addition in the hands of the appellant on the basis of said diary without excluding the transactions pertaining to the said land, which in mv view is not correct as neither during the course of search, not in the post search enquiries, including the remand reports, any evidence has been brought on record by the Assessing Officer indicating any investment by the appellant in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nged this part of deletion. The Tribunal made detailed analysis of the material available on record and reversed the finding of the ld.CIT(A) major error according to the assessee crept in the finding of the Tribunal while dealing with this ground of appeal. It is pertinent to observe that a diary, annexure A/1 was found from the residential premises of one Shri Arvindbhai Shah who happened to be accountant of the assessee. He has disclosed that this diary was being written on the basis of instruction of the assessee. Thus the Tribunal was called upon to make an analysis of the statement of Shri Arvind Shah recorded under section 132(4) of the Act on 20.10.2000. Thereafter, his statement was recorded under section 131 on 19.9.2002. On an analysis of the seized materials as well as finding of the AO, the Tribunal arrived at a conclusion that the ld.CIT(A) has erred in deleting the addition on account of sharafi business partly. 11. Let us revert to the specific objection highlighted by the assessee in his synopsis filed during the course of hearing before the Tribunal. The first issue pointed by the assessee is that ITAT has drawn presumption under section 132(4) on the diary A/1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to its understanding and taken one of the possible opinions. 12. In the next issue it has been pleaded that no discussion was made about the amount of ₹ 23,43,08,700/- deleted by the ld.CIT(A). Again to our mind, it is very minor peripheral issue. At the time of hearing Tribunal took into cognizance bifurcation of ₹ 27,32,38,000/-. While taking cognizance of the statements made by the assessee in para 5.3, the Tribunal has taken into consideration bifurcation of total amounts and as to how ₹ 23,43,08,700/- has been treated by the CIT(A) could be assessable in the hands of Manoj Vadodaria in whose case 153-BD proceedings was allegedly pending. Once the Tribunal has taken into consideration whole amount and appreciated the controversy with that angle, reversed the finding of the ld.CIT(A) then not taking into considering this issue separately, is not an apparent error. It is such a minor aspect which has not influenced the decision making processing. Impliedly, this ground and aspect is embedded in the overall finding of the Tribunal running into first 40 pages. 13. In the next issue, the assessee has pleaded that the Tribunal took cognizance of the writte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal. It is also pertinent to observe that after hearing these MAs., in the last one-and-half months Judicial Member remained either on tour or on leave. Therefore, MAs., could not be disposed within time limit stipulated in Rule 34 of Income Tax (Appellate Tribunal) Rules, 1963. Thus, on account of this cumulative effect i.e. non-adjudication of the MAs., within time limit coupled with fact that the assessee has not filed affidavit supporting allegation that department has not filed written submissions during the course of hearing, we deem it appropriate to hear these MAs. afresh. Therefore, they are released and Registry is directed to list them for hearing on 5th January, 2018. Both parties be informed accordingly. Sd/- Sd/- (PRAMOD KUMAR) (RAJPAL YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER 14. The assessee has filed an affidavit stating therein that copy of the submissions was not supplied. The ld.DR pointed out that original copy of submissions is available with the file of DR. It is also filed on the record of the ITAT. He further pointed out that whenever submissions are being given across the bar, acknowledgements are not being taken. Once the copy of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re of the view that we are not sitting in appeal over the order of the Tribunal. We are required to re- appreciate the evidence. We have to find out whether these aspects have been considered or not by the Tribunal. It is conscious decision after evaluation of all evidences. There is no apparent error as such in the order of the Tribunal. The assessee is trying to point out very minor apparent error i.e. observation of the Tribunal that diary has a single entry ledger account of various sharafi business, whereas according to the AO diary contained accounts/transaction not purely sharafi in nature. The same are classified in three categories. We do not see that reference to such small aspects would have bearing on the decision making process. The Tribunal has analyzed the issue. More so, these aspects are not to be looked into in a proceeding under section 254(2) of the Act. On overall analysis of both the MAs. we are of the view that the assessee has tried to get the order of the Tribunal reviewed in the garb of pointing out apparent mistake, which is not permissible in law. We do not find any apparent mistake in the order of the Tribunal, hence, both the MAs. are rejected. 17. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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