1993 (10) TMI 313 - AT - Income Tax

Summary

Issues Involved:

1. Mistakes of Law
2. Mistakes of Fact
3. Consideration of Additional Evidence
4. Jurisdiction and Powers of the Tribunal under Section 254(2)
5. Application of Supreme Court and High Court Judgments

Issue-wise Detailed Analysis:

1. Mistakes of Law:
The assessee contended that the Tribunal considered additional evidence after the Commissioner of Income-tax (Appeals) passed his order on November 11, 1987, violating Rule 29 of the Appellate Tribunal Rules, 1963. Specifically, the statements of Bahadur Singh, Prithvi Raj, and Ved Pal recorded on April 29, 1988, and November 22, 1989, were cited. The Revenue responded that these statements were cited by the assessee in his favor and not by the Revenue. Since neither party objected to the use of these statements during the hearing, no rule was violated.

2. Mistakes of Fact:
The assessee pointed out several factual inaccuracies in the Tribunal's order, such as the incorrect interpretation of Bahadur Singh's statement regarding crop production and savings, and the misrepresentation of Baldev Singh's loan repayment details. The Revenue argued that these were not mistakes apparent from the record and that the Tribunal's appreciation of evidence was correct.

3. Consideration of Additional Evidence:
The Tribunal's order dated September 27, 1990, relied on statements recorded after the Commissioner of Income-tax (Appeals)'s order. The assessee argued that these statements were not part of the original record and were considered without proper opportunity. The Revenue countered that the assessee had introduced these statements in the paper book, and thus, could not claim a lack of opportunity.

4. Jurisdiction and Powers of the Tribunal under Section 254(2):
The Tribunal examined whether it had the power to recall its order based on the alleged mistakes. The Delhi High Court in CIT v. K. L. Bhatia held that the Tribunal has no inherent powers to review its order on merits, but only incidental or ancillary powers. The Tribunal can rehear a matter under Section 254(2) only to rectify mistakes apparent from the record, not to reconsider the merits.

5. Application of Supreme Court and High Court Judgments:
The Tribunal considered the Supreme Court's decision in Omar Salay Mohamed Sait v. CIT, which held that appellate authorities must consider evidence collected after the assessment if it is relevant and the parties are given an opportunity to explain it. The Calcutta High Court in CIT v. Nopany Education Trust held that the Tribunal has inherent powers to rehear an appeal if it decided a point of law based on wrong facts. The Tribunal found that it had improperly relied on evidence collected after the Commissioner of Income-tax (Appeals)'s order without clear reasons.

Separate Judgments Delivered:

Judicial Member's Judgment:
The Judicial Member opined that the Tribunal should recall its order and rehear the case to allow both parties to clarify their stands on the additional evidence. The Judicial Member emphasized that the Tribunal's reliance on post-appeal evidence without proper consideration was a mistake that needed rectification.

Accountant Member's Judgment:
The Accountant Member disagreed, stating that the Tribunal was justified in considering the additional statements as they were part of the record and filed by the assessee. He cited the Supreme Court's decision in Omar Salay Mohamed Sait v. CIT, which supported the consideration of post-assessment evidence. The Accountant Member concluded that there was no mistake apparent from the record warranting the recall of the order.

Third Member's Judgment:
The Third Member agreed with the Accountant Member, stating that the Tribunal's consideration of the additional evidence did not cause any injustice. The Third Member emphasized that the evidence was introduced by the assessee and not objected to by the Revenue. He concluded that the miscellaneous applications filed by the assessee should be dismissed, as there was no mistake apparent from the record.

Conclusion:
The Tribunal decided, by majority opinion, to dismiss the assessee's miscellaneous applications, upholding the original order and confirming the addition of Rs. 9,49,000 representing the cash credits. The decision was based on the view that the Tribunal's consideration of additional evidence was justified and did not constitute a mistake apparent from the record.