TMI Blog2012 (3) TMI 672X X X X Extracts X X X X X X X X Extracts X X X X ..... has filed an affidavit which reads as under :- 2. In the Memorandum of Appeal and thereafter by way of additional grounds the Revenue had taken following grounds of appeal in ITA Nos. 770 to 774/Kol/2010 (i) That the Ld. CIT (A) erred on facts and in law, that Controlling interest has a separate existence from the shares and is separately tradable. (ii) That the Ld. CIT(A) erred in holding that for the purposes of capital gains only the portion of ₹ 74.20 should be considered as sale value and the balance was non taxable ignoring the judgment of Madras High Court in the case of Venkatesh Minor Vs. CIT 234 ITR 367 where the facts were absolutely identical. (iii) That the Ld. CIT(A) was not justified in upholding the contention of the assessee that consideration amounting to ₹ 28, 45,68,900/- was received for parting with Controlling interest and thus was not taxable. . (iv) That the Ld. CIT(A) erred in holding that the decision of the Bombay High Court in the case of M/s. Vodafone (2009) 311 ITR 46 supports the case of the present assessee, whereas in fact it is the other way round. (v) Without prejudice, the Ld. CIT(A) has further erred in holding th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revenue. As such the Tribunal unilaterally could not enlarge the scope of the appeal. The enlargement of the scope of appeal by the Tribunal was therefore against the powers conferred on it by Sec.254(1) of the Act. (b) The finding or direction of the Tribunal to assess ₹ 15 per share as business income u/s 28(va) of the Act amounted to enhancement by the Tribunal which power the Tribunal did not have. (c) Before issuing direction for assessment of ₹ 15.00 as business income u/s 28(va) the Tribunal had not afforded any opportunity of being heard to the parties and the said finding was recorded in complete breach of principle of natural justice and without considering the merits and facts of the case and therefore the said finding is liable to be vacated and/or recalled by the tribunal since the same is recorded in complete breach of principles of natural justice. 4. On the other hand the ld. DR appearing on behalf of the revenue had also submitted a written submission to counter the arguments of the ld. AR for assesee and further contended that the case laws referred by the ld. AR the High Courts has those said that the Tribunal is not having jurisdiction and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... After taking into consideration of the above, the Tribunal has given its findings at para 22.1. which is as under :- 22.1 At the outset we would like to clarify that even though the revenue has taken various grounds of appeal, the subject matter of appeal before the tribunal is the transactions entered into by the parties as per share purchase agreement dated 28- 01-06. It is very unusual that neither the AO nor the ld.CIT(A) has taken note of article 5 of the said agreement, where has been clearly stated that ₹ 15/- per share is being paid per sale share towards Non-Compete Undertaking, which is included in the sale consideration payable to the sellers in terms of article 2.2 of the agreement. In such peculiar circumstances, we will give our factual findings on the issue of capital gains or any other income arising out of the transactions entered into by the concerned parties as per share purchase agreement dated 28-01-06. Thus, the contention of the assessee that there is no dispute that Controlling Interest was transferred together with shares is not accepted by us. We will give our findings on this basis. Again at para 22.5.the Tribunal supported the acti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e under the head business as per section 28(va). Similarly, at para 25 this Tribunal has observed as under :- b. ₹ 15/- per share is to be assessed as income under the head business as per section 28(va). 5.1 After careful perusal of the written submissions made by both the parties and on perusal of the above observations made by the Tribunal, the contention of the assessee that Tribunal unilaterally could not enlarge the scope of the appeal is not accepted. While dealing this issue this Tribunal itself has observed at para 22.1. which is as under :- 22.1 At the outset we would like to clarify that even though the revenue has taken various grounds of appeal, the subject matter of appeal before the tribunal is the transactions entered into by the parties as per share purchase agreement dated 28- 01-06. It is very unusual that neither the AO nor the ld.CIT(A) has taken note of article 5 of the said agreement, where has been clearly stated that ₹ 15/- per share is being paid per sale share towards Non-Compete Undertaking, which is included in the sale consideration payable to the sellers in terms of article 2.2 of the agreement. In such peculiar c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g aside assessment-While remanding the matter to do assessment on the basis of audited accounts, Tribunal, however, had no jurisdiction, whatsoever, to have further given a direction that the income of the assessee could not be assessed at less than the amount of income returned by it in the returns which were treated to be non est by the AO-Further, the Tribunal could not have given a direction, while disposing of the rectification applications, that the income or fresh assessment should not be assessed at an amount above the income assessed under s. 144-AO shall assess the income afresh without being bound by any lower or upper limit as laid down by the Tribunal 5.4. Keeping in view of the above ratio laid down by Hon ble Himachal Pradesh High Court and the observations made by this Tribunal at paras 5.1. and 5.2. the second contention of the assessee is not acceptable and cannot consider the same as a mistake apparent from record. 5.5. However, as regarding the third contention that the assessee has not been given proper opportunity of being heard, that the Tribunal has not exceeded its jurisdiction. However, we further observe that the Tribunal has given its opinion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... power to review. 5.6. Respectfully following the above proposition of the Hon ble Supreme Court the Hon ble Delhi High Court in the case of Lachman Dass Bhatia Hingwala (P) Ltd. vs ACIT (2011) 330 ITR (Del) 243 has observed that Fundamental principle is that no party appearing before the Tribunal should suffer on account of any mistake committed by the Tribunal and no prejudice is caused to either of the parties before the Tribunal which is attributable to the Tribunal s mistake, omission or commission and if the same error is a manifest error, then the Tribunal would be justified to recall its order- While exercising the power of rectification under s. 254(2), Tribunal can recall its order in entirety if it is satisfied that prejudice has resulted to the party which is attributable to the Tribunal s mistake, error or omission and which error is a manifest error and it has nothing to do with the doctrine or concept of inherent power of review. 5.7. Keeping in view of the above propositions of the Hon ble Apex Court and Hon ble Delhi High Court and the facts of the present case, we are of the view that in this case while deciding the non-compete fee of ₹ 15/- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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