TMI Blog2022 (10) TMI 723X X X X Extracts X X X X X X X X Extracts X X X X ..... nder sub-section (1) of Section 206CB of the Act. In the facts of that case, this Court held that subsequent decision can validly form the basis for rectifying an order of assessment under Section 154 of the Act. We respectfully agree with the reasonings given by a coordinate Bench of this Court in B.V.K.Seshavataram (supra); rather we are bound by it. If this position is applicable to Section 154 of the Act, we are of the view that it is equally applicable to Section 254(2) of the Act. Summation of our above discussion is that the Tribunal was not justified in rejecting the rectification application of the appellant. We answer question No.1 so framed above in the negative and in favour of the assessee. Resultantly, we set aside the order. - I.T.T.A. No.103 of 2001 - - - Dated:- 7-9-2022 - Hon ble The Chief Justice Ujjal Bhuyan And Hon ble Sri Justice C.V.Bhaskar Reddy For the Appellant : Mr. Karthik Ramana Puttam Reddy For the Respondent : Ms. K.Mamata Chowdary (Standing Counsel for Income Tax Department) JUDGMENT: PER THE HON BLE THE CHIEF JUSTICE UJJAL BHUYAN Heard Mr. Karthik Ramana Puttam Reddy, learned counsel for the appellant and Ms. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the file of the assessing officer for quantification of the interest to be chargeable vide the order dated 22.10.1997. 7. After the aforesaid decision was rendered by the Tribunal on 22.10.1997, assessee filed a miscellaneous petition before the Tribunal stating that the above two decisions of the Supreme Court in State Bank of Travancore (supra) and Kerala Financial Corporation (supra) have since been overruled by the Supreme Court in the case of UCO Bank v. CIT (1999) 237 ITR 889 . Therefore, Tribunal was requested to rectify the order dated 22.10.1997 under Section 254(2) of the Act. 8. By the order dated 23.02.2001, Tribunal held that decision rendered by the Supreme Court in UCO Bank (supra) was subsequent to the order of the Tribunal dated 22.10.1997. The said decision was not available at the time of decision rendered by the Tribunal. Therefore, there is no mistake apparent from the record in the order of the Tribunal, scope of rectification being very limited. If the prayer for rectification was allowed, it would amount to review of the decision of the Tribunal which is impermissible. Therefore the miscellaneous petition for rectification was dismissed. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 154 of the Act. Elaborating on this aspect, he submits that while Section 154 of the Act applies to rectification by an assessing officer, similar principle is applicable to the Tribunal under Section 254(2) of the Act, provisions being pari materia. 14. Ms. K.Mamata Chowdary, learned counsel for the respondent has raised an objection that the appeal is not maintainable. She has referred to Section 260A of the Act, more particularly to sub-section (1) thereof, and submits that an appeal under Section 260A of the Act shall lie to the High Court from every order passed in appeal . An order rejecting the application seeking rectification under Section 254(2) of the Act is not an order passed in appeal. Therefore, an appeal under Section 260A of the Act to the High Court against an order rejecting prayer for rectification would not be maintainable. In support of such contention, she has placed reliance on a decision of the High Court of Bombay in Chem Amit v. Assistant Commissioner of Income Tax (2005) 272 ITR 397 (Bombay) . Thereafter, she submits that the decision of the Supreme Court in Saurashtra Kutch Stock Exchange Ltd. (supra) was based on the fact that at the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstrued to be an order within the ambit of the expression every order passed in appeal appearing in sub-section (1) of Section 260A of the Act. 19. There is one more reason why we are unable to accept the submission made by learned counsel for the respondent. As we have already noticed above, the appeal was admitted way back on 20.09.2001. Twenty one years have gone by since then. After admission of the appeal and after such long lapse of time, it would not at all be justified to dismiss the appeal on the point of maintainability. 20. At this stage, we may also refer to sub-section (4) of Section 260A of the Act which says that the appeal shall be heard only on the question so formulated and the respondent shall at the hearing of the appeal, be allowed to argue that the case does not involve such question. As per the proviso, nothing in sub-section (4) of Section 260A of the Act shall be deemed to take away or abridge the power of the Court to hear for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question. Therefore, it is open to the respondent to argue before the High Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions which formed the substratum of the decision of the Tribunal can be the basis of rectification under sub-section (2) of Section 254 of the Act. 26. In Saurashtra Kutch Stock Exchange Ltd. s case (supra) the facts before the Supreme Court were that while deciding the appeal by the Tribunal, the decision of the jurisdictional High Court i.e., High Court of Gujarat was not brought to the notice of the Tribunal. Assessee contended that there was thus a mistake apparent from the record which required rectification. Supreme Court considered as to whether non-consideration of the decision of the jurisdictional Court or of the Supreme Court could be said to be a mistake apparent from the record. Supreme Court answered the above issue in the affirmative holding that such a mistake can be said to be a mistake apparent from the record which can be rectified under Section 254(2) of the Act. Supreme Court thereafter analysed the situation from a jurisprudential perspective and thereafter held that if a subsequent decision alters an earlier one, it does not make any new law; it only discovers the correct principles of law which has to be applied retrospectively. Overruling is retrospec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rectifying an earlier order in exercise of the powers under section 154 of the Income-tax Act? Although the opening words of section 154(1) - with a view to rectifying any mistake apparent from the record, the income-tax authority. . . . may give the impression that a judgment which came subsequently, not being part of the record at the time when the assessment was finalised, could not be the basis for rectification of any mistake under section 154, the legal position is no longer in doubt in view of the authoritative pronouncement of the Supreme Court in S. A. L. Narayana Row, CIT v. Model Mills Nagpur Ltd. MANU/SC/0168/1966 : [1967] 64 ITR 67 (SC). In that case, the assessing authority subjected excess dividends to income-tax. Subsequently, the Bombay High Court in Khatau Makanji Spinning and Weaving Co. Ltd. v. CIT MANU/MH/0348/1956 : [1956] 30 ITR 841 (Bom), held that levy of tax on excess dividends was illegal. On the basis of that decision, a claim for refund was made by the assessee requesting the assessing authority to rectify the earlier order mistakenly made. That plea was rejected by the assessing authority and also by the Commissioner of Income-tax when a revisi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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