2013 (1) TMI 262 - AT - Income Tax

Seeking rectification of the order of the Tribunal - the ratio laid down by the Hon ble AP High Court in the case of Rajlaxmi Trading Co. v. CIT 2001 (2) TMI 84 - ANDHRA PRADESH HIGH COURT is not applicable to the facts of the assessee s case as the same is not concerned with stock-in-trade, but deals with capital assets valuation on dissolution of the firm - Held that - As seen from the arguments of the assessee s counsel, the assessee wants to re-argue the issue before the Tribunal once again which is not permitted u/s. 254(2). The Tribunal while adjudicating the issue on earlier occasion considered the entire arguments of the assessee s case and given the finding, incidentally, not in favour of the assessee. As the issue is decided against the assessee, now the assessee finds that there is mistake apparent on record which is actually not so. It is well settled that statutory authority cannot exercise power of review unless such power is expressly conferred. There is no express power of review conferred on this Tribunal. Even otherwise, the scope of review does not extent to re-hearing of the case on merit as decided in CIT v. Pearl Woolen Mills 2009 (11) TMI 48 - PUNJAB AND HARYANA HIGH COURT The words used in Section in 254(2) are shall make such amendment, if the mistake is brought to its notice . Clearly, if there is a mistake, then an amendment is required to be carried out in the original order to correct that particular mistake. The provision does not indicate that the Tribunal can recall the entire order and pass a fresh decision. Thus the argument of the assessee s holds no merit and deserves to be rejected.

Summary

Issues:
1. Rectification of order by Appellate Tribunal ITAT Hyderabad regarding valuation of stock-in-trade.
2. Application of precedents set by Supreme Court and High Court in similar cases.
3. Interpretation of Section 254(2) of the Income Tax Act for rectification of mistakes apparent from the record.

Issue 1:
The appellant filed a Miscellaneous Application seeking rectification of the Appellate Tribunal's order regarding the valuation of stock-in-trade for the assessment year 2005-06. The appellant argued that the judgment of the Hon'ble Jurisdictional High Court in a previous case was not applicable to their case as it concerned capital assets, not stock-in-trade. The appellant contended that the Supreme Court's judgment in a subsequent case was more relevant to their circumstances. However, the Tribunal found that the appellant's request to re-argue the issue was not permitted under Section 254(2) of the Act. The Tribunal held that there was no mistake apparent on record, and the issue had already been considered and decided against the appellant.

Issue 2:
The appellant relied on precedents set by the Supreme Court and the High Court in similar cases to support their argument. The appellant highlighted the differences in the facts and issues addressed in the judgments of the Supreme Court and the High Court. The Tribunal emphasized that the scope of the Tribunal's power to recall an order was limited to rectifying mistakes apparent from the record. The Tribunal discussed the application of Section 254(2) of the Act and reiterated that the power to rectify a mistake did not extend to recalling the entire order or re-hearing the case on merit. The Tribunal concluded that the appellant's argument based on the Supreme Court's judgment was not valid within the scope of Section 254(2) and therefore rejected the appellant's plea for reconsideration.

Issue 3:
The Tribunal provided a detailed analysis of the scope and application of Section 254(2) of the Income Tax Act. The Tribunal clarified that the power to rectify a mistake under this section was limited to correcting mistakes apparent from the record and did not include the power to review or recall the entire order. The Tribunal cited relevant case law to support their interpretation of the statutory provision. It was emphasized that the Tribunal could not allow the appellant to reopen or reargue the entire matter under the guise of a rectification application. The Tribunal concluded that the appellant's argument did not have merit within the framework of Section 254(2) and dismissed the Miscellaneous Application filed by the appellant.