2014 (8) TMI 352 - HC - Income Tax

Rectification of order u/s 154 - Mistake apparent on record Various marketing expenses - Held that - If the Tribunal concludes that some point or issue which may be very debatable, but was not raised or argued before the Tribunal, then it cannot take note of the grievance of the Revenue - That would require it to conduct an exercise of going behind the entire order and record and find out whether it omitted from consideration certain vital factual material or statement or figures therein thus, the conclusion recorded does not suffer from any perversity nor can be termed as vitiated by any error of law apparent on the face of the record enabling us to exercise our writ jurisdiction Decided against Revenue.

Summary

Issues:
Challenge to order of Income Tax Appellate Tribunal under Article 226 of the Constitution of India.

Analysis:
1. The Writ Petition challenges the order passed by the Income Tax Appellate Tribunal on 06.12.2013 in a Miscellaneous Application. The Revenue argued that certain claims related to marketing expenses should have been disallowed, even though part of the expenses had been allowed by the Commissioner of Income Tax (Appeals). The Tribunal's order was criticized for not matching figures provided by the Assessee and for dismissing the Miscellaneous Application with cryptic reasoning. The Court found that all parameters for interference in its Writ jurisdiction were satisfied, allowing the Revenue to question the order.

2. The Court examined the scope of rectification proceedings under Section 154(1A) of the Income Tax Act, 1961. It noted that the Tribunal cannot reopen findings on factual matters considered conclusive unless legality and validity are questioned in a distinct proceeding. The Tribunal's dismissal of the Revenue's application for rectification was based on detailed contentions and submissions by both parties. The Court found that the Tribunal's decision did not suffer from perversity or error of law, thus dismissing the Writ Petition.

3. The Revenue's request for the Tribunal to correct its order based on alleged factual errors was deemed impermissible by the Court. The Assessee relied on the limited scope of powers under Section 154(1A) and argued that the Tribunal cannot consider debatable points not raised during the proceedings. The Court concluded that the Tribunal's decision did not warrant interference through the discretionary and equitable jurisdiction under Article 226 of the Constitution of India. Therefore, the Writ Petition was dismissed without costs.