TMI Blog1993 (3) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... al order is relevant and not the date on which the rectification orders were passed. The following table abstracts the various dates which have a bearing on the issue involved: --------------------------------------------------------------------------------------------------------------------------------------------------- Assessment Date of initial Date of order Date of order Date of order year assessment under section under section under section order 154 154 251 --------------------------------------------------------------------------------------------------------------------------------------------------- (1) (2) (3) (4) (5) --------------------------------------------------------------------------------------------------------------------------------------------------- 1976-77 21-9-1979 12-7-1982 1-9-1984 25-10-1984 1977-78 21-9-1979 12-7-1982 1-9-1984 25-10-1984, 4-9-1986 1978-79 12-8-1980 12-7-1982 1-9-1984 25-10-1984, 4-9-1986 1979-80 25-5-1981 12-7-1982 1-9-1984 25-10-1984, 4-9-1986 1980-81 8-1-1982 12-7-1982 25-10-1984 ----------------------------------------------------------------------------------------------------------- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egal position, the Commissioner of Income-tax (Appeals) dismissed the assessee's appeals. Thereupon, the assessee approached the Tribunal. On an examination of the facts and circumstances of the case and following the decision of the Patna High Court in the case of Bihar State Road Transport Corporation v. CIT [1986] 162 ITR 114, the Tribunal held that the assessee was entitled to succeed. It may here be highlighted that the Tribunal distinguished the decision of the Calcutta High Court in the case of Bengal Assam Steamship Co. Ltd. v. CIT [1978] 114 ITR 327. Learned counsel for the parties reiterated before us their respective submissions before the Tribunal. Learned counsel for the assessee submitted that the period of limitation in the facts of the case should start running from July 12, 1982, the date on which the Income-tax Officer had passed the rectification orders under section 154. According to him, the original assessment order got merged with the rectification orders of the said later date, viz., July 12, 1982. Further, depreciation itself was one of the matters that fell for consideration in the orders under section 154 passed on that date, and it is immaterial that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... original order unless the rectification arises from the appellate order. It is of course patent that this rule does not hold good where the rectification sought for is in respect of mistake arising from the appellate order or from the rectification order itself but in the present case obviously it is not that the assessee seeks to have rectified a mistake which the Assessing Officer committed while passing the rectification order. According to the Revenue, it is only in such contingency the period of limitation shall commence from the date of the rectification order or the appeal order, as the case may be. Learned counsel for the assessee, however, sought to distinguish the Gujarat decision in Ahmedabad Sarangpur Mills Co. Ltd.'s case [1976] 102 ITR 712, pointing out that the High Court was concerned with the provisions of section 35 of the old Act, materially different from the provisions of section 154 of the new Act. Section 35 of the repealed Act empowered the Income-tax Officer to rectify only an assessment order and not any other order. Therefore, the Gujarat High Court reasonably held that it was not permissible to enlarge the import of the expression " from the date of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12, 1982, also, that date should be taken into account for purposes of computing the period of limitation. As we see it, there is nothing in section 154(7) to suggest that, in a case where the mistake that had earlier occurred in the assessment order gets repeated, either by accident or by design, in a subsequent rectification order, the mistake in question cannot be rectified by reckoning the period of limitation with reference to the date of the rectification order. The position would of course have been different if a certain mistake arose in an assessment order and the subsequent rectification order dealt not with that aspect of the matter in which the mistake had occurred initially, but with some other matters. In such cases, the mistake having occurred in the original order, the period of limitation must be reckoned with reference to the date of the original order. It bears repetition that, in this case, depreciation allowance was one of the items considered in the set of rectification orders passed on July 12, 1982. Under the Income-tax Act, 1961, allowance towards depreciation is a single item of allowance, even though the quantum of the allowance is calculated on di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the subject-matter of the appellate or revisional order and the scope of the appeal or revision contemplated by particular statute, vide State of Madras v. Madurai Mills Co. Ltd. [1967] 19 STC 144 (SC). The same can be also said of the effect of merger or fusion when the original order is rectified in any part. It can be equally said that the original order does not get completely merged or fused in the rectification order. The fusion or merger by virtue of the rectification order passed is only to the extent it relates to the matter considered and decided in the rectificatory order. The other part of the assessment order which relates to items forming the subject-matter of the original assessment order does not merge in the rectification order. This holds good even after an appeal from an order of assessment is decided by the appellate authority. A mistake in that part of the assessment order which was not the subject-matter of review of the appellate authority and was left untouched by him does not merge and the order in such part remains open for rectification by the Assessing Officer under section 154. On this there was some judicial controversy. See Karsandas Bhagwandas Pat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the statute confers on him but such argument does not advance the assessee's case since the limitation under sub-section (7) of section 154 is rigid and there is no power vested in any authority to condone the delay. A rectification order must be passed within the period of limitation prescribed under section 154(7). There is no provision like that in section 5 of the Limitation Act, 1963, for condoning delay even if there is sufficient cause for such delay. This aspect of the matter has been dealt with by the Orissa High Court in CIT v. Gangaram Chapolia and Co. [1991] 187 ITR 594. The court held that there is no help where the rectification is not made within the time. In the present case, it is the admitted position that four years long passed before the assessee sought for rectification in question. It is precisely for that reason that the assessee took the position that the limitation should commence not from the date of the original order of assessment but from the date of the rectification order that was passed on July 12, 1982. The view is urged because if computed from that date, the application is well within the time and there is no impediment to the rectification ..... X X X X Extracts X X X X X X X X Extracts X X X X
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