2009 (2) TMI 64 - HC - Income Tax

Tribunal in impugned order rejected the Rectification Application - applicability of Section 249(4)(a) - while passing the impugned order, the Tribunal has categorically recorded that ground was not raised by revenue before us at the time of hearing of the stay petition, therefore, there is no mistake apparent from record and on the short ground itself, the department s petition u/s. 254(2) can be dismissed held that there is no legal infirmity in the impugned order of Tribunal

Summary

Issues involved:
Interpretation of Sec. 249(4) applicability to Tribunal by implication, Rectification Application under section 254(2) challenge, Mistake apparent on record for Rectification Application rejection.

Analysis:

Interpretation of Sec. 249(4) applicability to Tribunal by implication:
The dispute revolved around the application of Sec. 249(4) to the Tribunal by implication. The Tribunal, in the case under consideration, had granted partial stay against recovery of demand and imposed certain conditions. The Revenue challenged this decision through a Rectification Application under section 254(2) of the Act, citing Sec. 249(4)(a) to argue that the Appeal was not admissible until the tax duty on the returned income was paid. The Tribunal rejected the Rectification Application on grounds of no apparent mistake on record and the merits of the controversy regarding the applicability of Sec. 249(4)(a). Ultimately, the Tribunal held that the Rectification Application was not maintainable primarily due to no ground being raised, leading to rejection solely on that basis.

Rectification Application under section 254(2) challenge:
The Rectification Application under section 254(2) was challenged by the Revenue concerning the applicability of Sec. 249(4)(a) to the Appeal process. The Tribunal, in its order, highlighted that the Revenue did not raise the specific ground during the hearing of the stay petition, leading to the rejection of the Rectification Application. The Tribunal emphasized that since no mistake was apparent from the record, the Rectification Application could be dismissed. The Tribunal's decision was based on the lack of any ground raised by the Revenue, making the Rectification Application not maintainable.

Mistake apparent on record for Rectification Application rejection:
The Tribunal based its rejection of the Rectification Application on the absence of any mistake apparent on record. The Tribunal noted that the Revenue did not raise the specific ground regarding the applicability of Sec. 249(4)(a) during the relevant proceedings. Therefore, the Tribunal concluded that there was no legal infirmity in the impugned order, as there was no apparent mistake necessitating rectification. Consequently, the Rectification Application under section 254(2) was rejected solely on the ground of no identifiable mistake on record, without delving into the merits of the controversy.

In conclusion, the Tribunal's decision to reject the Rectification Application was primarily based on the lack of any apparent mistake on record and the failure of the Revenue to raise relevant grounds during the proceedings. The judgment emphasized the importance of maintaining procedural requirements and grounds for challenging decisions, ultimately leading to the disposal of the Reference without costs.