2014 (3) TMI 1126 - HC - Income Tax

Rectification of mistake u/s 154 - Allowing the appeal of the assessee against the order of CIT(A) confirming the order passed by the Assessing Officer u/s.154 - addition u/s 14A - Held that - The applicability of provisions of section 14A was a disputed issue and hence was not rectifiable under section 154 of the Act and secondly, addition made under invocation of section 14A was not held sustainable by the Tribunal, and therefore, such order was not sustainable. Learned counsel has submitted that the order of the Tribunal on the first ground is vulnerable. It could not have sustained considering the details provided by the assessing officer and also keeping in mind the fact that it was a mistake in the computation which was being rectified by the assessing officer. Without opining anything on the first aspect and keeping that issue open, on the second ground that on merit the decision of the Tribunal has been upheld by this Court in Tax Appeal No. 2014 (5) TMI 12 - GUJARAT HIGH COURT , this issue does not deserve any further indulgence.

Summary

Issues:
Challenge to order of Income Tax Appellate Tribunal under section 154 of the Income Tax Act.

Analysis:
The case involved a substantial question of law challenging the order of the Income Tax Appellate Tribunal (the Tribunal) dated 30.8.2013. The primary issue was whether the Tribunal erred in law in allowing the appeal of the assessee against the order of the Commissioner of Income Tax (Appeals) confirming the order passed by the Assessing Officer under section 154 of the Income Tax Act. The assessing officer had initially passed an order under section 154 of the Act on 14.3.2011. The Commissioner of Income Tax (Appeals) upheld the assessing officer's decision, stating that it was based on the correct understanding of the statute and did not require any interference. However, the Tribunal disagreed with the Commissioner's decision on two grounds. Firstly, it considered the applicability of section 14A as a disputed issue, making it not rectifiable under section 154. Secondly, the Tribunal found the addition made under section 14A not sustainable, leading to the order being deemed unsustainable. The Court noted that the Tribunal's decision on the first ground was debatable, but it did not delve into that aspect. However, on the second ground, the Court upheld the Tribunal's decision on merit in a previous case, indicating that no further consideration was necessary. Consequently, the Tax Appeal was dismissed based on the above analysis.