INCOME TAX ACT, 1961

Section 254(2)

Appeal (Tribunal) - Rectification under section 254(2) - -

Assessee filed an application dated 12-6-2008 before Tribunal for recalling of Order, dated 30-4-2008. In said application, it was contended that addition made by AO in block assessment was deleted by CIT(A) which was affirmed by Tribunal in further appeal by Revenue. This order of Co-ordinate Bench of Tribunal was not considered by Tribunal while passing of Order, dated 30-4-2008. Hence, prayer was made for recall of the said order. The said miscellaneous application was registered as M.A.No.420 /Mumbai/2008. By Order, dated 05-1-2009, Tribunal allowed miscellaneous application by recalling the Order, dated 30-4-2008 and for hearing of appeal afresh. This order was impugned by revenue in the instant writ proceeding. Revenue submitted that as per section 254(2) of Tribunal could only rectify a mistake apparent from record and had no power to recall its order in entirety.Held: Miscellaneous application filed by assessee before Tribunal for recall of its Order, dated 30-4-2008 there was no reference to any provision of law under which it was filed. Be that as it might, it had to be we treated it to be an application under Section 254(2) and not application under Rule 24 of the Income Tax (Appellate Tribunal) Rules, 1963 since admittedly Order, dated 30-4-2008 was not an ex-parte one. That apart, though assessee had referred to the order passed by CIT(A) as well as by Tribunal in block assessment, there was no specific averment that said orders were brought to the notice of Tribunal or argued before Tribunal and that Tribunal did not consider such argument of assessee. All that was stated in the application was that Tribunal did not refer to the order of its Co-ordinate Bench regarding block assessment. Moreover, assessee had merely stated that a mistake had crept in the order of Tribunal for not considering its own order passed by Coordinate Bench. It was not the case of assessee that it was a mistake apparent from the record which was required to be rectified. All mistakes cannot be rectified under section 254(2). Only a mistake which is apparent from record can be rectified under said provision. As regards impugned Order, dated 5-1-2009 passed by the Tribunal it was evident, even according to the Tribunal, decision given by it in appeal was correct but because Coordinate Bench decision was not mentioned or discussed, entire order was recalled and appeal was directed to be heard afresh. When on one hand Tribunal said that its decision was correct, it was beyond understanding to why and how the Tribunal recalled said correct order. Tribunal had come to the conclusion that non-consideration of Co-ordinate Bench decision was a mistake apparent from record. As apparent, there was no averment in miscellaneous application by the assessee that it had pointed out or argued Co-ordinate Bench decision relating to block assessment during hearing of appeal and Tribunal did not consider the same. Thirdly, having regard to the order passed by Tribunal in quantum appeal, no prejudice had been caused to assessee. All that Tribunal had done was to restore the matter to AO for fresh decision in accordance with law in which assessee would have ample opportunity to place all the materials at its command before AO for consideration. In light of all this Tribunal was not justified in passing impugned Order, dated 5-1-2009. Accordingly, said order was hereby set aside and quashed. Rule was made absolute.

REFERRED :

FAVOUR : Against the assessee.

A.Y. :

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