TMI Blog1985 (4) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... ner, the claim for exemption cannot be considered. The assessee came before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner by his order dated October 3, 1974, accepted the contention of the assessee by holding that there is a glaring and obvious mistake of law in this case as the income of the assessee from warehousing was exempt. Aggrieved by the said order of the Appellate Assistant Commissioner, the Revenue came up in appeal before the Income-tax Appellate Tribunal. The Tribunal considered the respective submissions and held that for claiming exemption under section 83 of the Income-tax Act, 1961, as it then existed, it will be necessary to prove in the first place that the assessee was constituted under the law for the marketing of commodities and the exemption will be limited only to income derived from the letting of godowns or warehouses for storage, processing or facilitating the marketing of commodities, The printed accounts of the assessee show that apart from the receipt of Rs. 5,72,323, there were other receipts which cannot be said to be obviously from the letting of godowns, etc., in respect of which exemption would automatically be ava ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner can ask for the exemption in a proceeding under section 154 of the Act. Section 154 of the Act provides that the Income-tax Officer may amend the order of assessment if there is a mistake apparent from the records. The mistake in such a case should be glaring and obvious. If there is any debatable question or if only upon construction of a statute the mistake has to be ascertained, then it will not be a mistake apparent from the records. The Appellate Assistant Commissioner held that "there are no two opinions that the income of the Warehousing Corporation established under the statute is exempt." The assessee-corporation was established under the Agricultural Produce (Development and Warehousing) Corporation Act, 1956, replaced by the Warehousing Corporations Act, 1962. The assessee was being assessed as a company under section 39 of the Warehousing Corporations Act, 1962. Section 39 of the Act provides that for the purpose of income-tax a warehousing corporation shall be deemed to be a company within the meaning of the said Act and shall be liable to income-tax and super-tax accordingly on its income, profits and gains. The assessee is a statutory corporation created to per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntrary to public interest. In that case, the Allahabad High Court observed that coinciding with the enactment of the Agricultural Produce (Development and Warehousing) Corporation Act of 1956 (which was later replaced by the Warehousing Corporations Act of 1962), Parliament amended the Indian Income-tax Act, 1922, by introducing sub-section (5) to section 14 of that Act (corresponding to section 10(29) of the 1961 Act). With the establishment of warehousing corporations and co-operative societies for marketing of commodities, Parliament, by way of giving incentive to these newly created business institutions, granted exemption in respect of income derived from the letting of godowns or warehouses for storage, processing or facilitating the marketing of commodities. Evidently, the legislative intent was to encourage the warehousing industry by granting substantial tax exemptions. Dr. Pal also relied on a decision in the case of India Woollen Textile Mills (Pvt.) Ltd. v. CIT [1978] 111 ITR 205, where the Punjab and Haryana High Court held that where a statutory provision was completely lost sight of, the matter could be treated as an error apparent from record and rectified under s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat we are concerned with is whether there was an error apparent from the record. In view of the findings of fact by the Tribunal regarding the absence of materials necessary for granting the relief under section 80J and in view of the finding of the Tribunal that none of the conditions laid down by section 80J(4) was satisfied in the present case, it is obvious that there was no error apparent from the record so far as the original proceedings were concerned. It is only on this limited aspect that we want to base our decision in the instant case." Mr. Bagchi has relied on a decision in the case of M. P. Warehousing Corporation v. CIT [1982] 133 ITR 158 (MP). There, it was held that to claim exemption under section 10(29) (corresponding to section 83 since deleted by the Finance (No. 2) Act, 1967 with effect from April 1, 1968), it must be proved that the income derived by an authority constituted for the marketing of commodities is income which is derived from letting of godowns or warehouses for the purpose specified in section 10(29), which are storage, processing or facilitating the marketing of commodities. If the letting of godowns or warehouses is for any other purpose, or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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