1981 (9) TMI 144 - AT - Income Tax

Summary

Issues:
1. Whether the rejection of the assessee's application under s. 154 was justified.
2. Application of Circulars by tax authorities in assisting the assessee in claiming relief.
3. The duty of the CBDT to condone delays in filing applications for securing refunds.

Detailed Analysis:
1. The judgment dealt with the case where the assessee sold a chassis without debiting the purchase price in the same assessment year. The Income Tax Officer (ITO) included the sale proceeds in the assessee's income without deducting the purchase price. The assessee applied for rectification under s. 154 to reduce the income by the purchase price, which was rejected by the ITO. The Appellate Authority Commissioner (AAC) allowed the appeal, but the Tribunal considered the rejection of the application to determine if it was justified. The Tribunal found that the omission to deduct the purchase price was not a mistake apparent from the record, as there was no evidence to suggest it was omitted.

2. The judgment referred to three authorities where Circulars were discussed in assisting the assessee in claiming relief. In one case, it was held that if the facts were already on record at the time of assessment, the assessee would be entitled to relief. However, in the absence of material on record, the provisions of s. 154 could not be invoked. The High Court emphasized the duty of the ITO to guide the assessee in claiming relief as per Circulars, but noted that without material, it would be impossible for the ITO to assist.

3. The judgment also discussed a case where the CBDT refused to give directions to condone a delay in filing registration applications for securing refunds. The Court observed a contradiction between the Government's intentions and actual practice in condoning delays. It highlighted the moral duty of the Government to intervene in cases where assurances had been given to prevent injustice. However, the judgment clarified that this duty did not require the Government to grant all claims disregarding legal norms and procedures.

In conclusion, the Tribunal held that the assessee could not get the relief claimed, setting aside the AAC's order and allowing the appeal. The judgment emphasized the importance of having clear legal principles and evidence to support claims, rather than relying solely on general moral duties or intentions of the tax authorities or the Government.