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2021 (8) TMI 864 - AT - Income TaxRectification u/s 254 - Penalty u/s 271(1)(c) was deleted - HELD THAT - On perusal of the MA filed by the Revenue it is noticed that there is no allegation highlighting the mistake apparent from the record. The sole basis of making the request for recalling of the order is that penalty has been deleted by the ITAT without appreciating the fact that the additional income would have gone tax free, had there not been any search u/s 132 - We find no allegation in the MA preferred by the Revenue that there was an error apparent from the record in the impugned order of the ITAT. Without prejudice to the above, assuming the findings of the ITAT is not correct than it would not amount to a mistake apparent from record which could be rectified under the provision of section 254(2) of the Act. If the decision of the ITAT is wrong than the aggrieved parties can approach to the Higher Judicial forum i.e. Jurisdictional High Court. But such findings cannot be rectified on the reasoning that there is a mistake apparent from the record. If we do so it would amount to review its own order by the ITAT which is not permissible. ITAT has passed this order after making reference to the provisions of explanation 5A to the section 271(1)(c) of the Act, and after relying on the order of ITAT in the case of Ajay Trader V/s DCIT 2016 (6) TMI 422 - ITAT JAIPUR - We hold that the order of the ITAT does not suffer from any infirmity as alleged by the Revenue - MAs filed by Revenue are dismissed.
Issues Involved:
Recall of order by Revenue based on mistake apparent from the record in penalty deletion by ITAT. Analysis: In the present case, the Revenue sought to recall the order passed by the ITAT on the grounds of a mistake apparent from the record. The issue arose from the penalty deletion by the ITAT in relation to additional income disclosed during a search and seizure action. The assessee admitted additional income of ?25,000 during the search, leading to penalty proceedings under explanation 5A to section 271(1)(c) of the Act. The penalty was confirmed by the CIT(A) but subsequently deleted by the ITAT. The Revenue contended that the ITAT's decision was erroneous as the penalty was based on incriminating documents seized during the search. However, the ITAT held that penalty cannot be imposed solely on the addition made under search proceedings without supporting incriminating documents. The ITAT emphasized that the provision of section 254(2) of the Act allows rectification only for a mistake apparent from the record. It noted that the Revenue's request for recalling the order was based on disagreement with the ITAT's decision rather than a mistake in the order. The ITAT clarified that if its decision was incorrect, it could be challenged in a higher judicial forum, but rectification under section 254(2) was not the appropriate remedy. The ITAT's order was made after considering the provisions of explanation 5A to section 271(1)(c) and a precedent case. Ultimately, the ITAT concluded that its order did not suffer from any infirmity alleged by the Revenue, leading to the dismissal of all Miscellaneous Applications filed by the Revenue. Furthermore, similar grounds raised by the Revenue in other cases were also dismissed following the reasoning and decision provided in the lead case. The ITAT maintained consistency in its approach across cases and reiterated that the decision in the lead case applied mutatis mutandis to the related cases. Consequently, all Miscellaneous Applications filed by the Revenue were dismissed collectively in the combined results of the judgment. In conclusion, the judgment addressed the issue of recalling an order based on a mistake apparent from the record in the context of penalty deletion by the ITAT. The ITAT's decision highlighted the limited scope of rectification under section 254(2) and emphasized the need for a genuine mistake in the order for such recall. The judgment demonstrated a thorough analysis of the legal provisions and precedents, leading to the dismissal of the Revenue's applications across multiple cases.
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