2015 (8) TMI 201 - HC - VAT and Sales Tax

Rectification of mistake - Tax Board changes the order stating it to be rectification - Held that - Tax Board was not justified in passing the impugned order by holding that a mistake apparent on the face of record, was committed by the Tax Board in order dt.08/05/2007 and has corrected the earlier order of the Tax Board dt.08/05/2007 - Tax Board in the impugned order has considered what was not before the Tax Board who decided the appeal vide order dt.08/05/2007. In my view, only a mistake apparent on the face of record can be rectified but I notice in the present order that the Tax Board has reviewed its own order which is impermissible in law. - scope of rectification, in my view, is limited and the matter though can be rectified on a mistake apparent, obvious and glaring but every mistake cannot be corrected/rectified by the Tax Board. Even re-appreciation of same material is not permissible - mistake apparent on record must be an obvious and patent mistake and the mistake should not be such which can be established by a long-drawn process of reasoning. Under the Act Review is impermissible or coming to a totally different conclusion what was reached earlier. Earlier view cannot be changed in the garb of rectification unless there is a glaring and obvious mistake apparent on the face of record - rectification implies the correction of an error or removal of defects or imperfections and could not be used to appreciate the evidence on new facts which were not placed earlier. Rectification implies an error, mistake or defect which after rectification is made right. - Decided in favour of Revenue.

Summary

Issues:
Challenge to rectification application allowed by Tax Board despite debatable issue involved.

Analysis:
The case involved a Sales Tax Revision Petition against an order passed by the Rajasthan Tax Board related to the assessment year 2001-02. The respondent, a contractor, claimed exemption based on a notification but was not satisfied with the Assessing Officer's decision. The DC (A) upheld part of the claim but rejected the rest. The Tax Board later rejected the entire claim. Subsequently, the respondent filed a rectification application, which was allowed by the Tax Board, reversing its earlier decision. The petitioner contended that the Tax Board exceeded its jurisdiction by reviewing its own order, which is impermissible in law. The court observed that rectification is limited to correcting obvious and glaring mistakes and cannot involve re-appreciation of evidence or consideration of new facts. Citing relevant legal precedents, the court emphasized that rectification should only correct patent mistakes and not debatable points or incorrect applications of law.

The court referred to Section 37 of the RST Act, which allows rectification of mistakes apparent from the record. It noted that rectification should be based on obvious and patent mistakes, not debatable points. The court highlighted that rectification cannot involve re-appreciation of evidence or reconsideration of legal views. It further emphasized that rectification should not lead to a different conclusion than the original decision. Quoting legal judgments, the court reiterated that rectification is meant to correct errors or defects, not to review or change previous decisions. The court ultimately allowed the Sales Tax Revision Petition, holding that the Tax Board was unjustified in reviewing the order under the guise of rectification. Consequently, the order of the Tax Board was quashed and set aside in favor of the revenue.