TMI Blog1998 (3) TMI 120X X X X Extracts X X X X X X X X Extracts X X X X ..... f manufacturing sagol, lime, clay and other allied items. The petitioner firm owns a plant situated at Barwaha, where its manufacturing process is being carried on. The petitioner maintains accounts from Diwali to Diwali. The petitioner commenced its business in the accounting year relevant to the assessment year 1978-79. In the said accounting year, the petitioner filed its return for the year 1978-79. The petitioner claimed deductions under sections 80HH, 80J and 32A of the Income-tax Act (hereinafter referred to as "the Act"). The aforesaid deductions claimed by the petitioner were allowed by the Income-tax Officer, vide order dated January 30, 1980, for the assessment year 1978-79. The petitioner continued to carry on its business and filed its return in time for the next assessment years 1979-80 and 1980-81 and claimed similar deductions. These deductions were also allowed by the Income-tax Officer on March 30, 1982, and March 18, 1983, respectively. Just after the expiry of two months from the date of passing of the said order, notice under section 154 of the Act, was issued to the petitioner on May 11, 1983, calling upon the petitioner to file a reply to it. Even though no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orders, issued under section 154 of the Act, which was wholly illegal and impermissible under law. According to him, the impugned orders deserve to be quashed, as the same do not show any application of mind. To advance the contention in this regard, the petitioner has placed reliance on the following judgments reported in Master Construction Co. (P.) Ltd. v. State of Orissa [1966] 17 STC 360 (SC) ; CTO v. Sri Venkateswara Oil Mills [1973] 32 STC 660 (SC) ; Balaram (T. S.), ITO v. Volkart Brothers [1971] 82 ITR 50 (SC) ; CIT v. Steel Tubes of India P. Ltd. [1982] 138 ITR 619 (MP) ; Abhinendra Kumar v. CIT [1984] 150 ITR 189 (MP) ; Travancore Rayons Ltd. v. ITO [1977] 109 ITR 43 (Ker) ; CIT v. Indian Institute of Public Opinion Co. P. Ltd. [1982] 134 ITR 23 (Delhi) and CWT v. Ginni Devi Jalan [1990] 186 ITR 168 (Patna). The respondents have submitted reply in oppugnation. It has not been disputed that for earlier financial years, deductions as claimed by the petitioner, under sections 80HH, 80J and 32A of the Act were allowed. It has been submitted that the petitioner has sought time to file a reply to the notice, under section 154 of the Act, but did not file any reply. It ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommodation in the nature of a guest house ; (b) any office appliances or road transport vehicles; (c) any ship, machinery or plant in respect of which the deduction by way of development rebate is allowable under section 33 ; and (d) any machinery or plant, the whole of the actual cost of which is allowed as a deduction (whether by way of depreciation or otherwise) in computing the income chargeable under the head 'Profits and gains of business or profession' of any one previous year. Explanation.---For the purposes of this sub-section, 'actual cost' means the actual cost of the ship, aircraft, machinery or plant to the assessee as reduced by that part of such cost which has been met out of the amount released to the assessee under sub-section (6) of section 32AB. (2) The ship or aircraft or machinery or plant referred to in sub-section (1) shall be the following, namely:--- (a) a new ship or new aircraft acquired after the 31st day of March, 1976, by an assessee engaged in the business of operation of ships or aircraft; (b) any new machinery or plant installed after the 31st day of March, 1976--- (i) for the purposes of business of generation or distribution of ele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is referred to in section 33B, in the circumstances and within the period specified in that section ; (iii) it is not formed by the transfer to a new business of machinery or plant previously used for any purpose in any backward area ; (iv) it employs ten or more workers in a manufacturing process carried on with the aid of power, or employs twenty or more workers in a manufacturing process carried on without the aid of power." Now, coming to the deduction as claimed under section 80J, the relevant part of the section is reproduced hereinunder : "80J. (1) Where the gross total income of an assessee includes any profits and gains derived from an industrial undertaking or a ship or the business of a hotel, to which this section applies, there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction from such profits and gains (reduced by the deduction, if any, admissible to the assessee under section 80HH or section 80HHA) of so much of the amount thereof as does not exceed the amount calculated at the rate of six per cent. per annum on the capital employed in the industrial undertaking o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) With a view to rectifying any mistake apparent from the record--- (a) the Income-tax Officer may amend any order of assessment or of refund or any other order passed by him ;..." From a plain reading of the aforesaid provision, it is crystal clear that for invoking jurisdiction conferred on the authorities by this section, a mistake has to be apparent from the record. Thus, all mistakes that might be committed by the authorities in passing the orders, shall not amount to mistakes apparent from the record. From a long catena of cases, which have been cited by the respective parties, it is now too well settled that any question which can be said to be debatable would not fall in the category of mistake apparent from the record. In view of the fact that this legal position is no more in dispute, it is not necessary for me to deal with each and every authority individually, cited by the respective parties. In fact, the question involved in this petition has been answered recently by the apex court in CIT v. Hero Cycles Pvt. Ltd. [1997] 228 ITR 463. The Supreme Court has held, that for invoking the jurisdiction under section 154 of the Act, for exercising power of rectifica ..... X X X X Extracts X X X X X X X X Extracts X X X X
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