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2023 (8) TMI 154 - AT - Income TaxPower of the AO to rectify mistake of his super senior officer - hierarchy of the Departmental structure - AO by way of invoking provisions of section 154 passed impugned order rectifying the tax calculation error in the form 5 issued by ld. PCIT - HELD THAT - On being asked by the bench Senior DR could not assist us as to under which provision the AO was empowered to invoke provisions of sec 154 of the Act to rectify the order passed by his super senior officer i.e. ld. PCIT. In our humble view form no. 5 dated 13.01.2021 under VSVS scheme was issued by the ld. PCIT, Ghaziabad and the Assessing Officer rectified tax calculation mistake in the same form by invoking provisions of sec 154 of the Act on 20.09.2022. AO is not validly entitled and empowered to rectify mistake of his super senior officer therefore we are inclined to hold that impugned rectification order u/s. 154 is without jurisdiction, invalid and bad in law thus the same is not sustainable and we set aside the same. Sole grievance of assessee is allowed.
Issues involved:
The issues involved in the judgment are the competency of the Assessing Officer to rectify the order of Principal CIT, Ghaziabad, the acceptance of declaration forms by the Pr. CIT, Ghaziabad, and the validity of the rectification order passed by the Assessing Officer under section 154 of the Act. Competency of Assessing Officer: The appellant contended that the Assessing Officer was not competent to rectify the order of Principal CIT, Ghaziabad, as any mistake pointed out by the A.O. should be rectified by the Principal CIT. The appellant argued that the declaration filed and accepted by the Pr. CIT, Ghaziabad, through Form No. 2 and Form No. 3, respectively, should not have been rectified by the A.O. The Senior DR supported the action of the Assessing Officer, citing a clarification from CBDT allowing the A.O. to amend the order under clause 5 to rectify apparent errors. However, the tribunal found that the Assessing Officer was not validly empowered to rectify the order issued by the Principal CIT, Ghaziabad, and held the rectification order as without jurisdiction and invalid. The appeal of the assessee was allowed on this ground. Validity of Rectification Order: The tribunal noted that the form under the VSVS scheme was issued by the Principal CIT, Ghaziabad, and the Assessing Officer rectified a tax calculation mistake in the same form by invoking section 154 of the Act. The tribunal held that the Assessing Officer was not entitled to rectify the mistake of his superior officer, and thus, the rectification order was deemed without jurisdiction, invalid, and bad in law. Consequently, the tribunal set aside the rectification order and allowed the sole grievance of the assessee. This judgment highlights the importance of the hierarchy within the Departmental structure and the limitations on the powers of Assessing Officers to rectify orders issued by higher-ranking officers. It emphasizes the need for proper authorization and jurisdiction when making rectifications under the provisions of the Act.
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