1995 (3) TMI 32 - HC - Income Tax

Application For Rectification, Mistake Apparent From Record, Question Of Law, Rectification Of Mistakes

Summary

Issues:
1. Rejection of reference application under section 256(1) of the Income-tax Act, 1961.
2. Disallowance of various expenses by the Tribunal.
3. Rectification order challenged in Civil Rule No. 14(M) of 1992.

Analysis:
1. The judgment dealt with two petitions under section 256(2) of the Income-tax Act, 1961, raising common questions of law. The petitions were disposed of together. The first petition challenged the Tribunal's rejection of a reference application related to the assessment year 1983-84. The petitioner, a limited company, had appealed to the Commissioner of Income-tax (Appeals) and then to the Tribunal. The Tribunal rejected the reference application under section 256(1) of the Act, prompting the petitioner to file a civil rule against it. The Tribunal's decision was based on the lack of referable questions of law arising from the order dated May 7, 1991.

2. The petitioner contested various disallowances made by the Tribunal, including the disallowance of consultancy fees, payment to A. Furniture and Co., expenses for obtaining certified copies, bonus payment disallowance, deduction for borrowing bamboo thatch, and disallowance under section 80VV of the Act. The Tribunal remanded most of these points for fresh enquiry due to insufficient material. The petitioner argued that the Tribunal's findings were perverse, but the court explained that a finding is only perverse if it is altogether against the evidence. The court upheld the Tribunal's decision to remand these points for further examination based on the available facts.

3. In Civil Rule No. 14(M) of 1992, the petitioner challenged a rectification order by the Tribunal. The court clarified that rectification is permissible only for errors apparent on the face of the record and not for revisiting matters already decided. The Tribunal concluded that there was no mistake apparent from the record, leading to the dismissal of the petitioner's challenge against the rectification order. The court found no legitimate ground to fault the Tribunal's decision in this regard.

In conclusion, the court dismissed both civil rules, upholding the Tribunal's decisions regarding the rejection of the reference application and the rectification order. The judgment emphasized the importance of factual evidence in challenging Tribunal decisions and the limited scope of rectification applications in tax matters.