2018 (8) TMI 1860 - AT - Income Tax

Rectification u/s 254 - whether assessee cannot be treated as a co-operative society meant only for its members and providing credit facilities to its members and hence they are not entitled to the benefit of section 80P(2)(A)(i) - HELD THAT - From the various judgements of the Supreme Court and other High Courts, it is clear, that the Tribunal s power u/s. 254(2) is not to review its earlier order, but only to amend it with a view to rectify any mistake apparent from the record. An error apparent on the record means an error which strikes one on mere looking and does not need a long drawn out process of reasoning on points on which there may be conceivably two opinions. The error should not require any extraneous matter to show its incorrectness. If the view accepted by the Tribunal in the impugned orders are one of possible views, these cases cannot be said to be covered by an error apparent on the face of the record. Since the assessee are not able to exactly point out the mistake apparent from the record the MP filed by them are dismissed. Miscellaneous Petitions filed by the assessee are dismissed.

Summary

Issues:
1. Interpretation of section 80P(4) for eligibility of tax benefits.
2. Scope of Tribunal's power under section 254(2) to rectify mistakes in orders.

Analysis:
1. The judgment pertains to Miscellaneous Petitions filed by assessees against the tribunal's orders denying them tax benefits under section 80P(2)(A)(i) for assessment years 2011-12 & 2014-15. The tribunal found that the assessees, engaged in commercial banking activities, did not qualify as cooperative societies providing credit facilities exclusively to members, as mandated by section 80P(4). Citing the Supreme Court's decision in a similar case, the tribunal held that the assessees were not entitled to the tax benefits. The assessees contended that the tribunal erred in its interpretation of the law.

2. The tribunal, in its order, emphasized that its power under section 254(2) is limited to rectifying mistakes apparent from the record and not for reviewing its earlier decisions. It clarified that an error apparent on the record should be one that is evident at first glance and does not require extensive reasoning. Since the assessees failed to demonstrate any such clear mistake in the tribunal's orders, their Miscellaneous Petitions were dismissed. The tribunal's decision was based on the principle that if a decision is based on a possible interpretation of the law, it cannot be considered a mistake apparent on the face of the record.

In conclusion, the tribunal dismissed the Miscellaneous Petitions filed by the assessees, upholding its earlier orders denying tax benefits under section 80P(2)(A)(i). The judgment highlights the importance of adhering to the statutory requirements for claiming tax benefits and the limited scope of the tribunal's power to rectify mistakes in its orders.