INCOME TAX ACT, 1961

Section 254(2)

Rectification - Under section 254(2) - No mistake apparent - Assessee sought review in the garb of section 254(2)

Assessee by way of Miscellaneous Application (MA) sought for recall of the Order passed by ITAT. Assessee stated that Tribunal, in substance had given two fact findings. (a) firstly, assessee had received consideration of Rs. 3,55,45,600 during the year ended 31-3-2011 because payment was expressly cited in the registered agreement dated 19-1-2011; the subsequent addendum dated 20-1-2011 implying the payment was not made was not to be believed as the addendum was not registered, and (b) secondly, assessee had not exercised the option as per Explanation 2 of section 11(1). Assessee had stated in his submission to AO that 'since there was no definite possibility that receipt would be received, the consideration was not taxed in assessment year 2011-12. Assessee submitted that above two findings were contrary to the facts on record on the ground that it had shown to the Tribunal in the course of hearing that the consideration of Rs. 3,55,45,600 was received in the financial year ended 31-3-2015; this receipt was shown to Tribunal from the copy of audited income and expenditure account of assessee for the year ended 31-3-2015; the amount of Rs. 3,55,45,400 was reflected in Note No. 15 [other incomes] to the Accounts -- LeaseHold Rights-Rs. 3,55,45,000. This fact had been lost sight of by Tribunal in its Order, dated 26-6-2019 and accordingly this constitutes a mistake apparent from record deserving rectification action under section 255(2).Held: Assessee had received Rs. 3,55,45,600 during financial year 2010-11 relevant to concerned assessment year. It was crystal clear from following (i) Deed of Assignment dated 19-1-2011 and the Schedule, (ii) Receipt of Rs. 3,55,45,600 by the assessee through cheque No. 889388 dated 18-1-2011 drawn on UBI, Juhu, Tara Road and (iii) The Basis of Accounting & Revenue Recognition followed by assessee during concerned assessment year. In the written submission assessee's main contention was 'since there is no definite possibility that receipt would be received the consideration was not taxed in assessment year 2011-12'. A reading of the said written submission clearly indicates that assessee had not exercised the option under clause (2) of Explanation to section 11(1). It was contention of assessee that ITAT failed to note that amount of Rs. 3,55,45,600 was not factually received during the year under consideration. This premise was not true as evident from the finding above that assessee had received Rs. 3,55,45,600 during the financial year 2010-11 relevant to concerned assessment year. The inference drawn by assessee was not a correct one as it is based on wrong premise. In fact, not a single error in the impugned order was pointed out by assessee. What assessee desired was a review of order passed by ITAT in the garb of section 254(2) which was not permissible.

Supported by:CIT v. Globe Transport Corpn. (1992) 195 ITR 311 (Raj-HC) : 1992 TaxPub(DT) 0290 (Raj-HC), CIT v. Roop Narain Sardar Mal (2004) 267 ITR 601 (Raj-HC) : 2004 TaxPub(DT) 0745 (Raj-HC), CIT v. Devilal Soni (2004) 271 ITR 566 (Raj-HC) : 2004 TaxPub(DT) 0935 (Raj-HC), Jainarain Jeevraj v. CIT (1980) 121 ITR 358 (Raj.-HC) : 1980 TaxPub(DT) 0727 (Raj-HC), Prajatantra Prachar Samiti v. CIT (2003) 264 ITR 160 (Orissa-HC) : 2003 TaxPub(DT) 0915 (Ori-HC), CIT v. Jagabandhu Roul (1984) 145 ITR 153 (Orissa-HC) : 1984 TaxPub(DT) 0355 (Ori-HC), CIT & Anr. v. ITAT & Anr. (1992) 196 ITR 640 (Orissa-HC) : 1992 TaxPub(DT) 0901 (Ori-HC), Shaw Wallace & Co. Ltd. v. ITAT & Ors. (1999) 240 ITR 579 (Cal-HC) : 1999 TaxPub(DT) 1375 (Cal-HC), CIT v. Suman Tea & Plywood Industries Pvt. Ltd. (1997) 226 ITR 34 (Cal-HC) : 1997 TaxPub(DT) 1128 (Cal-HC), ITO v. ITAT & Anr. (1998) 229 ITR 651 (Pat.-HC) : 1998 TaxPub(DT) 0223 (Pat-HC), CIT & Anr. v. ITAT & Anr. (1994) 206 ITR 126 (AP-HC) : 1994 TaxPub(DT) 0263 (AP-HC) and Asstt.CIT v. C.N. Ananthram (2004) 266 ITR 470 (Karn-HC) : 2004 TaxPub(DT) 1211 (Karn-HC).

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