TMI Blog1997 (9) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... lication which is the third in the series and was registered as M.A. No. 121/Mum./96 was filed along with an affidavit of Mr. D.M. Harish, Advocate, who had argued the assessee's appeal; on a stamp paper dated 15-7-1996 and executed on 15-7-1996. In the first part of the covering letter dated 15-7-1996 which is reproduced here as under: "In the case of the above applicant, hearing of the Miscellaneous Application No. 63/13/96 was fixed on 12-7-1996. Mr. Y.P. Trivedi, Senior Counsel had appeared on the aforesaid day and had withdrawn the said Application No. 63/13/96 with a liberty to file a fresh M.A. Accordingly, we are filing a fresh M.A. along with the Exhibit 'A', 'B' 'C'." 4. (i) We have heard the learned assessee's counsel as well as the learned departmental representative. The assessee's counsel has first of au submitted that M.A. filed on 16-7-1996 and registered as M.A. No. 121 /B/96 is a fresh M.A. because the M.A., filed on 8-7-1996, i.e., before the date of hearing of M.A. No. 63/13/96, which was heard on 12-7-1996; was inadvertently mentioned as revised M.A. by the assessee and M.A. No. 63/M/96 was withdrawn with a liberty to file a fresh M.A. and hence, the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r comments either to the assessee or to the department. (ii) Assessee's counsel has further submitted that another mistake has been committed in the Tribunal's order while deciding the assessee's plea based on existence of account of M/s. Lohia Agricultural Farm in the books of Jalan Trading Co. because existence of this account amply proves the genuineness of the credits taken from M/s. LAF. He has further submitted that the Tribunal has filed to consider the facts that the amounts were later on distributed amount the beneficiaries, who were members of Jalan Family, which is another mistake. (iii) Another alleged mistake in the eyes of the assessee's counsel was on account of Tribunal's finding on para 27 of its order where it has been observed that no evidence was filed to show that the applicant had actually, (Cultivated the land because, according to the assessee's counsel, the Assessing Officer as well-is the CIT (Appeals) had accepted the fact of availability of agricultural land with the creditor, M/s. LAF The assessee's counsel further submitted that another mistake which has been crept in para 27 at page 35 of the Tribunal's order wherein though the number of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ese loans out of agriculture income earned by the creditor; and (ii) that since the availability of agriculture income in the hands of the creditor f firm (M/s. LAF) had been accepted by the CIT while considering the assessee's disclosure petition for the years 1951-52 to 1971-72, and has allowed the credit to the tune of Rs. 97.75 lacs on account of availability of funds from agricultural income in the hands of M/s. LAF; the revenue now cannot dispute the availability of agriculture income in the hands of M/s. LAF in later years, i.e., during the periods relevant to assessment years 1976-77 to 1980-81. According to the assessee the revenue was barred f from considering the issue relating to availability of agriculture income in the hands of creditor, M/s. LAF during the periods relevant to assessment years 1976-77 to 1980-81 as a result of applicability of doctrine of res judicata. (ii) As observed by the lower authorities, the assessee, in spite of various opportunities given to it as per various letters including letter dated 18-3-1984 detailed in parts 11A, B, C and D of the Tribunal's order; and also an opportunity given by the Tribunal as recorded in para 26 of the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en on record. Thanking you, Yours faithfully, For M/s. Ramkumar Jalan Sd/- Partner." The assessee's plea of claiming the M.A. filed on 16-7-1996 (the present M.A.) to be a fresh M.A. on the plea that in M.A. filed on 8-7-1996, the assessee had inadvertently mentioned the same as 'revised application' and that the M.A. No. 63/Mum./96 was withdrawn with liberty to file a fresh M.A., in our opinion, is not factually correct, because, there is nothing on record which may suggest that M.A. No. 63/Mum./96 was withdrawn with the liberty to file a fresh M.A. or the Tribunal had allowed s such liberty because when the assessee's counsel Shri Y.P. Trivedi had made a request on 12-7-1996 for withdrawal of M.A. No. 63/Mum./96 on the ground that the assessee had filed a fresh M.A. on 8th July, 1996, the Bench had pointed out that M.A. filed on 8th July, 1996 is not fresh one, but a revised one and will stand withdrawn automatically after withdrawn of M.A. No. 63/Mum./96. On Tribunal's observation, as above, the learned Senior Advocate had preferred to end his innings with a smile on his face. In view of these facts and circumstances, we are of the opinion that the present M.A. is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on record. (ii) The Deponents statement in para 3 of the affidavit that Vols. IV and V of the paper books contain the case law relied upon by him on behalf of the assessee is also found to be incorrect because (i) five cases have been duly recorded and considered and (ii) the counsel had referred and relied only on five decisions duly recorded by the Tribunal in para 14 of the Tribunal order and not to any other case law. (iii) The Deponents statement that he had not withdrawn Ground Nos. 6 to 21 is also found to be incorrect because the Tribunal has nowhere stated so. The Tribunal has stated that these grounds were 'not pressed' or 'not argued'. There is lot of difference between the 'withdrawal of ground' and "non-pressing" or 'non-arguing of grounds', because in the former case the ground stands dismissed automatically whereas in the later case it is deemed to have been dismissed. (iv) The Deponents, in para 8 of the affidavit, has mentioned that the case laws, as per the list enclosed with the affidavits and copies of which were placed in Vols. IV and V of the paper book; were cited by him but have not been considered by the Tribunal is also found to be incorrect because ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Tribunal, being a creature of law, is debarred from reviewing its own decision. It can rectify only a mistake apparent from the records-either on its own motion or on an application by any of the parties. (ii) It is also settled law that the decision of the Tribunal should not be scrutinised sentence by sentence or word by word, merely to find out whether all facts have been set out in detail by the Tribunal or whether some incidental facts which may appear on the records or may have been stated during the course or arguments have not been noticed by the Tribunal in its order. If, on a bare reading of the order of the Tribunal as a whole, it is found that it has taken into account all relevant material as has also not based its decision on any irrelevant material, the order of the Tribunal is not to be interfered with. It is neither required nor it is necessary by the Tribunal to state in its order in express words or in specific terms that it has taken into the cumulative effect of the circumstances or has considered the totality of the facts as if that is a magic formula. It is to be persued to be so. On the other hand, if the Tribunal's order shows that it has taken into a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oing through the TO the assessee's submission is found to be correct and, therefore, the typographical error in para 18 and para 26 to the TO is rectified with the observation that the number of grounds mentioned in para 18 at page 20 and para 26 at page 35 of the TO may be read, instead of "7 to 21"; as "6 to 21". (ii) The next part of the assessee's submission was that its counsel had not withdrawn ground Nos. 6 to 21 at the time of hearing of the appeal and the Tribunal's observation to this effect is a mistake apparent from the records, which may be set at right by hearing the assessee with regard to ground Nos. 6 to 21. After considering the submissions advanced by the assessee's counsel as well as all the facts and circumstances of the case, first of all, we would like to mention that the assessee's statement is factually incorrect because the Tribunal has nowhere stated that ground Nos. 6 to 21 were withdrawn. The Tribunal was observed in para 1 and 18 of its order these grounds "were not pressed" whereas in para No. 36, the Tribunal has observed that these grounds "were not argued" and therefore, the assessee's grievance is not maintainable. On the contrary, the Tribunal' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he T.O., which states that "all the partners of the assessee firm were partners in capacity of kartas of the respective HUFs in the firm of M/s. LAF in whose name credit appears in the books of account of the assessee", we are of the opinion that there is no mistake in the Tribunal's observation in deciding this issue in these appeals, the Tribunal was not concerned with the constitution of M/s. LAF rather was concerned with the constitution of the assessee-firm, and the control of the assessee's partners over the affairs of M/s. LAF It was, therefore, in this context, that this fact, which is not correct at all as the Tribunal has nowhere stated that these were the only partners of M/s. LAF was extracted. Moreover, in para 8 of the T.O., the complete constitution of creditor firm M/s. LAF, including the names of two partners pointed out by the assessee, has been duly recorded and stands considered. There being no mistake in the T.O. as suggested by the assessee's counsel, the assessee's this plea, therefore, fails. (iv) The next grievance of the assessee as per the arguments advanced by the assessee's counsel and Para 4 of the application is that the Tribunal while agreeing with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uce the relevant extracts from the documents relied upon by the assessee's counsel. Extract from note on disclosure in Jalan's cases: (Page Nos. 621, 627-628 634) "Exhibit-I" Para No. 3.6 This was the main important issue. The details discussion by the IAC with the assessee could not consult in any agreed figures regarding the three important aspects to be considered in this regard, namely: (a) 200 acres were held by as per allotment in the year 1951 by the Dy. Commissioner as per evidence filed (placed on record) (b) All were ready for cultivation from 1951, and (c) The income was about Rs. 5,000 per acre. After discussion with the assessee, the Commissioner fixed the amount available for set off, after considering the investment of Rs. 70,00,000 at Rs. 97,75,000. The detail working shown in Annexure 'E' to this report. It was also pointed out at that time to the assessee that suitable action should be taken by him in regard to Wealth-tax payable in regard to these agricultural estates (whose value will be estimated on the basis of income fixed) and the amounts available for year after 1972. The assessee said that he would take suitable action. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r from the certified copy filed by you in para 'a' and 'c'. In para 'b' of your letter, you state that you have filed a certified copy of Khatauni in respect of 418.020 and 367.240 acres of land in village Majhaon. It is seen that you have not properly read the certified copy obtained by you. This certified copy submitted by you does not show any land in the name of Shri U.S. Lohia. This certified copy is simply a total acreage of land of class I to class IV as per the Khatauni register of Majhaon village, 367.240 acres of land mentioned by you in para 'b' of your letter is also not of Uma Shankar of land which is already included in the total of 418.020 acres. It is, therefore, your claim of para 'b' in respect of 418.020 and 367.240 acres of land in village Majhaon is absolutely incorrect. In para 'd', 'e', 'f' 'g' the certified copy given by you is found correct. In para 'h' you have stated that the certified copy of Khatauni in respect of 325.215 acres of land in the name of Shri Uma Shankar Lohia is exclusive of 158.465 acres of land is also incorrect. Because as per the certified copy the total land in the name of Shri U.S. Lohia is shown at 325.215 acres of land, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... form: "I visited Baharich personally as planned and intimated to the assessee. Nobody attended from assessee's side and it was clear that the assessee was not interested in giving any evidence whatsoever. It was noticed that Revenue authorities have taken up consolidation proceedings in villages, Majhao Gangapur during 1975-80 and had maintained consolidation Khasra in the Form CH 2A. These records shows various details including ownership and possession in respect of every plot of land in these villages. The assessee had completely failed to provide me any evidence relating to the possession of agricultural land belonging to other by LAF. On the other hand, it was noticed that there was certain acres of land in villages, Majhao and Gangapur only in the names of the Shankar Lohia, Shyamsunder Lohia, Jagnnath Lohia others. More than 95 per cent of such land was under the adverse possession of the other villagers since years, whose names appeared in consolidation khasara. It was also ascertained that part of the land belonging to Uma Shankar Lohia was sold for loan taken by him from Sadhan Sahakari Samiti which he could not discharge. The loan amounted to only few thousand rup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... affidavit of Shri D.M. Harish, is factually incorrect because out of 18 cases listed in it, the case laws at Sr. No. 2, 5, 6 and 10 have been duly taken note of by the Tribunal in para No. 14 and the other cases were not cited at all. The learned D.R. after referring erring to paras 16, 24, 25 and 26 further pleaded that even otherwise the order having been passed by the Tribunal by observing that it has gone through the records available before it, the rest of the case laws also stands considered. (a) After considering the rival submissions and having gone through the records available before us, first of all we would like to observe that the assessee's claim is factually incorrect because the cases at Sr. Nos. 2, 5, 6 and 10 of Annexure B attached with the affidavit have been duly noted in para 14 of the T.O. and therefore, the assessee's statement stands belied. Even otherwise, the Tribunal had proceeded to adjudicate upon the issue of genuineness of the cash credits after considering the whole of the records, which, naturally was inclusive of the list of cases included in the assessee's paper book though these were not cited; as is evident from the Tribunal's observation in p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income from undisclosed sources in the relevant assessment years. (b) As regards the assessee's grievance that the Tribunal has taken cognizance of case laws not cited before it at the time of hearing, we, after considering the rival submissions, are of the view that what the assessee's counsel seems to suggest is that the Members of the Tribunal were supposed to know only that much of law or facts or the application of law to the facts of a case as was told to them either by the members of the Bar or by the Departmental representative. It appeared to be the substance of the arguments and pleadings on behalf of the assessee that even if the members of the Tribunal knew some law they should first get the correctness of their understanding approved by the members of the Bar and unless they did so, their order on the basis of their understanding of law laid down by the Supreme Court or the jurisdictional High Court if it was referred to In the order of the Tribunal, would be a mistake apparent from record which the Tribunal was bound to rectify. It is not possible to subscribe to this view. The law requires that the Tribunal should hear both the parties in an appeal and should there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... members of Jalan Family and on account of non-consideration of these facts by the Tribunal, the Tribunal has failed to ascertain that these amounts were not belonging to the firm, M/s. Ramkumar Jalan. We have considered the facts and circumstances of the case and arguments advanced by the assessee's counsel. A bare reading of the part of the Tribunal's order where this piece of evidence has been considered. (Para 19) will show that this piece of evidence, which was claimed by the assessee as sufficient evidence for proving the genuineness of the credits appealing in the assessee's books of account in the name of creditor M/s. LAF; was rejected by the Tribunal not because of its authentication by way of signature on it, rather was rejected because of the fact that assessee had not prove the genuineness of the transaction and the capacity of the creditor to advance such loan. Such an evidence can be accepted as a sufficient evidence for genuineness of the cash credit and the transaction only if the other two ingredients, viz., identity and capacity of the creditor has been established. The genuineness of the transaction comes after establishing the identity and the capacity of cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT (Appeals) as well as ITO's letter dated 18-1-1984 have found that none of them has any where accepted the existence of agricultural land with the creditor or in the hands of Shri Uma Shankar Lohia during the periods relevant to assessment years 1976-77 to 1980-81. On the contrary the Assessing Officer has categorically observed in the last para of his letter dated 18-1-1984 reproduced at pages 12 and 13 of the T.O. that "the consolidation proceedings leave no doubt that practically the entire land was in the adverse possession". This conclusion was based on authenticated revenue record in Form No. CH2A, a copy of which was supplied to the assessee and the fact that the land belonging to Uma Shanker Lohia had been sold out. (c) If the conclusion arrived at by the Assessing Officer, which was duly communicated to the assessee as per letter and the assessee was specifically called upon to refute this evidence-as per last para of this letter ; was considered to be erroneous then the assessee should have filed evidence either before the Assessing Officer or before the CIT (Appeals) or before the Tribunal but in spite of ample opportunity more than required; having been allowed to e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only 5 appeals were decided and not six appeals. We, therefore, rectify the typographical mistake and hold that in the second line of para 27 of the T.O. the words "6 appeals" shall stand substituted by words "5 appeals". 12. Before parting with this matter, we would like to observe once again that though the assessee's M.A. is liable to be dismissed, on the ground of misuse/abuse of process of law as well as on the ground of being based on incorrect facts, but still in the interest of justice, we have preferred to decide the various alleged mistakes, claimed to have been crept in the Tribunal's order in the guise of mistakes rectifiable under section 254(2) of the Income-tax Act, on merits and have come to the conclusion that there is no mistake in the Tribunal's order as suggested and claimed by the assessee, which can be termed mistake apparent from the record and rectifiable under the provisions of section 254(2), though, of course, subject to our clarifications relating to the narration regarding number of grounds clarified in para 1 of this order and para 11(viii). The present M.A. is nothing but an attempt to argue the already decided appeals afresh in the guise of pointi ..... 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