2023 (6) TMI 37 - AT - Income Tax

Rectification of mistake u/s 254 - coordinate bench dismissed ground no.8 raised by the assessee as not pressed - HELD THAT - From the perusal of the record that the issue of the applicability of the rate of tax provided in the DTAA on dividend declared by the assessee was also raised before the learned CIT(A) by way of an application seeking admission of additional ground. CIT(A) though rejected the prayer of admission of additional ground, however, on a without prejudice basis decided this issue against the assessee on merits. Therefore, we find merits in the submissions of the assessee that this issue was specifically raised before the Tribunal and was also pressed in its appeal for the assessment year 2010-11. There is a mistake apparent from the record, which constitutes a rectifiable mistake u/s 254(2) - Accordingly, the order passed by the coordinate bench of the Tribunal in assessee s appeal for assessment year 2010-11 is hereby recalled limited to the extent of adjudication of ground no.8 on merits. Corresponding appeal was taken up for hearing limited to the extent of adjudication of ground no.8 raised by the assessee. Appearing for the parties fairly agreed that the issue arising in ground no.8 is covered in favour of the Revenue by the recent decision of Total Oil India Private Ltd 2023 (4) TMI 988 - ITAT MUMBAI (SB) . Accordingly, respectfully following the aforesaid decision of the Special Bench of the Tribunal, ground no.8 is dismissed.

Summary

Issues Involved:
The issues involved in this legal judgment include the recall/rectification of an order passed under section 254(1) of the Income Tax Act, 1961 regarding the applicability of the rate of tax provided in the India Mauritius Double Taxation Avoidance Agreement (DTAA) to the dividend declared by the assessee.

Summary:
In this case, a Miscellaneous Application was filed under section 254(2) of the Income Tax Act seeking recall/rectification of an order passed by the Tribunal in the assessee's appeal for the assessment year 2010-11, specifically regarding the adjudication of ground no.8 raised by the assessee. The issue raised pertained to the applicability of the rate of tax provided in the India Mauritius DTAA to the dividend declared by the assessee. The coordinate bench of the Tribunal had dismissed the said ground as not pressed, despite similar grounds raised in appeals for subsequent assessment years being remanded for adjudication on merits. The assessee had raised this issue as an additional ground before the first appellate authority, but it was dismissed. The Tribunal found merit in the submissions of the assessee that the issue was specifically raised and pressed in its appeal for the assessment year 2010-11, and therefore, a rectifiable mistake under section 254(2) of the Act was identified. The order was recalled limited to the extent of adjudication of ground no.8 on merits.

Subsequently, with the consent of both parties, the appeal was taken up for hearing limited to the adjudication of ground no.8. It was noted that the issue was covered in favor of the Revenue by a recent decision of the Special Bench of the Tribunal. Following the decision of the Special Bench, ground no.8 was dismissed. The Miscellaneous Application filed by the assessee was allowed, while ground no.8 raised in the appeal for the assessment year 2010-11 was dismissed.