2012 (10) TMI 717 - AT - Income Tax

Rectification application - Mistake apparent from the record - date of letter of first letter of the assessee in the re-assessment proceedings is 28.9.2004 and not 28.2.2004 - Held that - In order to attract the application of section 254(2), a mistake must exist and the same must be apparent from the record. The power to rectify the mistake, however, does not cover cases where a revision or review of the order is intended. A mistake which can be rectified under section 254(2) is one which is patent, which is obvious and whose discovery is not dependent on argument or elaboration. Recalling of the order is not permissible under Section 254(2). As decided in Ras Bihari Bansal Vs. Commissioner of Income Tax 2007 (4) TMI 47 - HIGH COURT, NEW DELHI it is well settled that an oversight of a fact cannot constitute an apparent mistake rectifiable under this section. Similarly, failure of the Tribunal to consider an argument advanced by either party for arriving at a conclusion, is not an error apparent on the record, although it may be an error of judgment. The mere fact that the Tribunal had not allowed a deduction, even if the conclusion is wrong, will be no ground for moving an application under section 254(2). Further, in the garb of an application for rectification, the assessee cannot be permitted to reopen and re-argue the whole matter, which is beyond the scope of the section - dismissal of application of the assessee being devoid of any merits as the assessee has not been able to point out any apparent mistake in the order passed by the Tribunal and in case application of the assessee is accepted, it would tantamount to review of the order of the Tribunal which is not permissible - against assessee.

Summary

Issues Involved:
1. Mistake in the date of the letter mentioned in the reassessment proceedings.
2. Validity and jurisdiction of the reassessment proceedings.
3. Applicability and scope of rectification under section 254(2) of the Income Tax Act, 1961.

Issue-wise Detailed Analysis:

1. Mistake in the date of the letter mentioned in the reassessment proceedings:
The assessee contended that the Tribunal erroneously noted the date of their letter as 28.2.2004 instead of the correct date, 28.9.2004. This mistake purportedly vitiated the reassessment proceedings, rendering them beyond the six-year limitation period. The Tribunal, however, found no apparent mistake in its order, as the date was correctly recorded by the Assessing Officer in the assessment order. The Tribunal emphasized that a mistake must be apparent from the record and not one that requires elaborate argument or investigation.

2. Validity and jurisdiction of the reassessment proceedings:
The assessee argued that the reassessment proceedings were invalid due to the incorrect date and affixture on the wrong address. However, the Tribunal noted that the reassessment proceedings were initiated correctly within the prescribed time limit by serving notice under section 148 of the Act through affixture on 1.10.2003. The Tribunal reiterated that the reply to the notice under section 142(1) dated 6.9.2004 did not confer jurisdiction for the initiation of reassessment proceedings. The Tribunal concluded that there was no jurisdictional error in the reassessment proceedings.

3. Applicability and scope of rectification under section 254(2) of the Income Tax Act, 1961:
The Tribunal examined the scope of section 254(2), which allows rectification of "mistake apparent from the record." The Tribunal clarified that this power does not extend to revising or reviewing an order. A mistake must be patent, obvious, and not dependent on argument or elaboration. The Tribunal cited several judicial precedents, including decisions from the Hon'ble Calcutta High Court (CIT vs Gokul Chand Agarwal), Andhra Pradesh High Court (CIT vs. I.T.A.T), and the Supreme Court (CIT vs Karam Chand Thapar and Br.P.Ltd.), to emphasize that rectification cannot be used to re-argue or review a matter. The Tribunal found that the assessee's application did not point out any apparent mistake but sought a review, which is not permissible under section 254(2).

The Tribunal concluded that the assessee's application lacked merit and dismissed it, reaffirming that rectification under section 254(2) is limited to correcting obvious and patent mistakes apparent from the record. The Tribunal's decision aligns with the established legal principles that rectification cannot be used as a means to review or re-argue a case.