2004 (7) TMI 689 - HC - Income Tax

Summary

Issues:
1. Oversight constituting a mistake apparent from record under Section 254(2) of the Act.
2. Refusal to allow benefit of telescoping to the appellant under Section 254(2) of the Act.

Issue 1: Oversight as a Mistake Apparent from Record:
The Tribunal had to determine whether an oversight of the fact could constitute a mistake apparent from the record under Section 254(2) of the Act. The appellant argued that the Tribunal had committed a mistake by not deciding the issue of telescoping, which was raised by them. However, the Tribunal, in its order, held that since no additions were sustained in respect of assets expenditure, the issue of telescoping required no discussion. The Tribunal dismissed the appellant's miscellaneous application, stating that there was no apparent mistake in the order. The appellant contended that the failure to consider and discuss the issue of addition in telescoping amounted to an apparent mistake in the order, justifying the acceptance of their miscellaneous application.

Issue 2: Benefit of Telescoping under Section 254(2) of the Act:
The Tribunal also had to address the issue of whether the benefit of telescoping should be allowed to the appellant under Section 254(2) of the Act. The CIT(A) had reduced the business income addition from Rs. 1,80,000 to Rs. 75,000. The Tribunal, in its order, noted that as no additions were sustained concerning assets expenditure, the addition on account of telescoping required no discussion. The Department argued that since no apparent mistake was found in the appeal order, no correction could be made under Section 254(2) of the Act. The Tribunal concurred, stating that as there was no apparent mistake in the appeal order, the application under Section 254(2) was rightly dismissed. Ultimately, the appeal was dismissed by the Tribunal.

In conclusion, the High Court upheld the Tribunal's decision, emphasizing that in the absence of any apparent mistake in the appeal order, the dismissal of the application under Section 254(2) of the Act was justified. The Court affirmed that the Tribunal's findings regarding the issues of oversight and telescoping were in accordance with the law, leading to the dismissal of the appeal.