2019 (3) TMI 1759 - AT - Income Tax

Rectification u/s 254 - Tribunal has wrongly mentioned that the AO has estimated the profit ratio at 12.5% whereas the AO has applied profit ratio of 25% - According to the learned counsel for the assessee the Tribunal has wrongly assumed the profit ratio and accordingly estimated the profit ratio at 12.5% on wrong premises - HELD THAT - We have gone through the order of the Tribunal and noted that this mistake has crept in the order of the Tribunal. Hence, we recall the order of the Tribunal and Direct the Registry to fix these appeals in regular course. In the result, the miscellaneous applications filed by the assessee are allowed.

Summary

Issues: Recalling of Tribunal order due to incorrect profit ratio mentioned.

Analysis:
The judgment by the Appellate Tribunal ITAT Mumbai dealt with the recalling of the Tribunal's order in two Miscellaneous Applications filed by the assessee. The assessee requested the recalling of the order in ITA No. 3434/Mum/2016 for A.Y. 2009-10 and ITA No. 3435/Mum/2016 for A.Y. 2010-11, dated 04.08.2017. The main contention raised by the assessee was regarding the incorrect profit ratio mentioned in the Tribunal's order. The Tribunal had mistakenly noted that the Assessing Officer (AO) estimated the profit ratio at 12.5%, whereas the actual profit ratio applied by the AO was 25%. The Counsel for the assessee pointed out that the Commissioner of Income Tax (Appeals) had restricted the profit ratio at 25% and not 12.5% as mentioned by the Tribunal. The Tribunal had wrongly assumed the profit ratio based on incorrect premises. The Senior Departmental Representative supported the Tribunal's order despite the error being pointed out.

Upon reviewing the order of the Tribunal, it was acknowledged that a mistake had indeed crept into the Tribunal's order regarding the profit ratio. Consequently, the Tribunal decided to recall its earlier order and directed the Registry to schedule these appeals in the regular course. As a result, the miscellaneous applications filed by the assessee were allowed, and the order was pronounced in the open court on 1st March 2019. This judgment underscores the importance of accurate recording of facts and figures in judicial orders to ensure fairness and justice in tax matters.