2015 (2) TMI 682 - AT - Income Tax

Rectification of mistake - as per assessee a mistake apparent from the record has crept in the order dated 22.08.2014 as the principal submissions of the applicant that having regard to the arbitration award dated 11.04.13, the matter should have been restored to the lower authorities for decision afresh after making a serious attempt to seek compliance from Mr. Karm Sheel Oberoi in terms of the arbitration award, have been overlooked by the Tribunal while deciding the appeals of the assessee Held that - This Tribunal has decided the matter on merits as was deemed to be justified to the prudence of the Members of the Tribunal. Neither any new fact nor any law has been brought by the ld. counsel for the assessee before us, which may be said to be escaped the attention of the Tribunal while deciding the appeal of the assessee on merits vide impugned order. Even the scope of provisions of section 254(2) is very limited and this Tribunal has got no authority to recall or review its entire order passed on merits of the case. If the assessee has any grievance against the impugned order, proper course to agitate the same is by filing an appeal before the next appellate authority i.e. the Hon ble High Court, but, not with the present application under section 254(2) of the Income Tax Act. The Ld. A.R. has not got any right to dictate or contend that why the order has not been passed or relief has not been granted in accordance with his wishes. Since there was no mistake apparent on the record, it was advised to the Ld. A.R. that such type of frivolous applications should be avoided as it not only wastes the precious time of the litigants but also of this Tribunal and also results in financial burden upon the parties. Neither the Ld. A.R. could point out any mistake apparent on the record dated 22.08.2014 nor the Ld. A.R. could not satisfactorily explain as to why a cost should not be imposed for moving such type of frivolous application. Hence we deem it proper to impose a cost of ₹ 10,000/- each on the assessee for moving the above stated two miscellaneous applications. Decided against assessee.

Summary

Issues involved:
- Rectification of order based on arbitration award
- Mistake apparent on record in the order dated 22.08.2014
- Consideration of internal dispute between directors
- Scope of provisions of section 254(2) of the Income Tax Act
- Imposition of costs for frivolous applications

Detailed Analysis:

1. The judgment pertains to two miscellaneous applications filed by the assessee regarding a common order dated 22.08.2014 by the Tribunal for assessment years 2007-08 & 2008-09. The applications sought rectification of the order based on an arbitration award dated 11.04.13. The contention was that the matter should be restored to the lower authorities for decision afresh in light of the arbitration award.

2. The assessee argued that a mistake apparent on record existed in the order as the Tribunal overlooked the significance of the arbitration award, which would impact the tax liability. The Revenue opposed the applications, asserting no error in the Tribunal's order. The Tribunal examined the contentions of both parties and reviewed the records to make a decision.

3. The Tribunal noted that the arbitration award and internal dispute between the directors were considered during the proceedings. The Tribunal pointed out specific paragraphs in the order where the contentions related to the arbitration award were discussed and rejected. It was emphasized that the Revenue was not concerned with internal disputes between directors and that the duty to furnish correct details lay with the assessee.

4. The Tribunal clarified that the scope of provisions under section 254(2) was limited and did not allow for a review of the entire order passed on merits. It was advised that dissatisfaction with the order should be addressed through an appeal to the higher authority. The Tribunal discouraged the practice of re-contesting matters through frivolous rectification applications, highlighting the burden it places on the parties and the Tribunal.

5. As the assessee failed to demonstrate any apparent mistake in the order and could not justify the need to avoid imposing costs for frivolous applications, the Tribunal decided to dismiss both applications and imposed a cost of Rs. 10,000 each on the assessee to discourage such practices. The assessee was directed to deposit the costs with the Revenue Authorities within 30 days, failing which recovery would be pursued.

6. The judgment underscores the importance of adhering to legal procedures, discouraging frivolous applications, and upholding the integrity of the Tribunal's decisions. It highlights the responsibility of parties to present relevant evidence and arguments effectively during proceedings and the limited scope for rectification under the law.