| The Tax Publishers2021 TaxPub(DT) 0768 (Pune-Trib) INCOME TAX ACT, 1961
Section 254(2)
Power of rectification under section 254(2) can be exercised only when mistake, which is sought to be rectified, is an obvious and patent mistake, which is apparent from the record and not a mistake, which is required to be established by arguments and long drawn process of reasoning on points, on which there may conceivably be two opinions.
|
Appeal (Tribunal) - Rectification under section 254(2) - No apparent mistake on record -
Revenue filed a miscellaneous application under section 254(2) seeking rectification in an order of Tribunal. Revenue submitted that the Tribunal granted relief to assessee and restricted the disallowance of expenses to the extent of 20% of the total expenses without clarifying the nature of expenses. So, Revenue wanted that disallowance on expenses, which was confirmed to the extent of 20%, should be made to 100%. It was further submitted that the Tribunal did not consider the enhanced amounts in respect of the disallowance made by the AO and confirmed by the CIT (A). Held: It was observed that Tribunal confirmed 20% of the disallowance on total expenses after analyzing all the facts and circumstances involved in the case. It was also observed that while reaching its decision, the Tribunal also considered certain decisions of the High Court. It is settled that power for rectification under section 254(2) can be exercised only when mistake, which is sought to be rectified, is an obvious and patent mistake, which is apparent from the record and not a mistake, which is required to be established by arguments and long drawn process of reasoning on points, on which there may conceivably be two opinions. Further, there was no mistake, much less any apparent mistake that warranted rectification in the order of Tribunal. Tribunal in its own wisdom adjudicated the appeal of the assessee after considering the decisions of the High Court. Thus, the Tribunal rightly adjudicated the issue in confirming 20% of the total expenses and therefore, prayer for making it as 100% of such expenses was not warranted within the scope of power as envisaged under section 254(2). Accordingly, the miscellaneous application filed by Revenue was dismissed.
REFERRED : Asstt. CIT v. Saurashtra Kutch Stock Exchange Ltd (2008) 305 ITR 227 (SC) : 2008 TaxPub(DT) 2300 (SC), Asstt. CIT v. Saurashtra Kutch Stock Exchange Ltd. (2003) 262 ITR 146 (Guj-HC) : 2003 TaxPub(DT) 1165 (Guj-HC) and CIT v. Ramesh Electric & Trading Co. (1993) 203 ITR 497 (Bom-HC) : 1993 TaxPub(DT) 847 (Bom-HC)
FAVOUR : In assessee's favour.
A.Y. :
 SUBSCRIBE FOR FULL CONTENT
|