INCOME TAX ACT, 1961

Section 254(2)

Rectification - Under section 254(2) - Debatable point vis-a-vis mistake apparent -

Before Tribunal, hearing was concluded on 23-7-2019 and order was pased on 18-10-2019. Assessee's case was that since tax effect in the appeal filed by revenue was below the limit of Rs. 50,00,000 laid down in CBDT Circular No. 17 of 2019, dated 8-8-2019, therefore, department should have withdrawn or should not have pressed the appeal, instead appeal was duly heard and allowed by the Tribunal. Hence, there was a mistake apparent from the record liable for rectification under section 254(2).Held: A mistake apparent on record must be an obvious mistake and not something which can be established by a long-drawn process of reasoning on points on which there may be conceivably two opinions. A decision on a debatable point of law is not a mistake apparent from record. Admittedly, during the course of hearing before Tribunal on 23-7-2019, neither assessee nor AO made any mention of Circular No. 17 of 2019, dated 18-8-2019. It was not a stand alone Circular; and was to be read in conjunction with CBDT Circular No. 3 of 2018. Circular No. 3 of 2018, dated 11-7-2018 also mentions at para 10 that adverse judgments relating to six issues should be contested on merits, notwithstanding that the tax entailed is less than the monetary limits specified in para 3 therein or there is no tax effect, which obviously requires long drawn process of reasoning. In the impugned order, there was no trace of patent, manifest and self-evident error which could be said to be an error apparent on the face of the record .What assessee desired was a review of order passed by Tribunal, which was not permissible under the Act. Accordingly, miscellaneous applications filed under section 254(2) was dismissed.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2004-05 & 2005-06

SUBSCRIBE FOR FULL CONTENT