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TMI Blog1984 (10) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment. 2. The assessee owned three tractors. With regard to two tractors, the assessee had paid interest during the relevant accounting period. In the original assessment, depreciation was allowed only on the written down value of the tractors. The interest paid was not capitalised and added to the WDV and, consequently, no depreciation was allowed on this amount. On 4-3-1976, the assessee applied for rectification of certain mistakes in the original assessment, order. The rectification order was passed by the ITO under section 154 of the Income-tax Act, 1961 (' the Act ') on 17-3-1976, wherein the ITO added the interest paid on the balance of the unpaid purchase price to the WDV and allowed depreciation at 25 per cent on the total a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne was that the order is barred by limitation, as the order has been passed beyond four years of the original assessment. The second was that the issue covered by the second rectification order was a debatable one and that the mistake was not apparent from the records. The first contention was rejected by the Commissioner (Appeals), as the second rectification was within four years of the first rectification order. The Commissioner (Appeals), however, accepted the second contention and cancelled the second rectification order. 4. In its appeal, the department questions the correctness of the finding of the Commissioner (Appeals) that the issue involved in the second rectification order was a debatable one and that the mistake corrected wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion order was available for further rectification and that what could be rectified is only the original assessment order as rectified by an earlier rectification order. 7. We are unable to accept this contention. In our view, the words ' any other order ' in section 154(1)(a) will include an earlier rectification order. The rectification order has an independent existence. Even an appeal has been allowed from the order. There may be cases where the mistake is only in the rectification order and it may not even be reflected in the assessment order as corrected by the rectification order. We are, therefore, of the view that a mistake apparent from the records in an earlier rectification order can be corrected by a subsequent rectification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. In dealing with this matter, the Gujarat High Court observed that : " . . . Even assuming as contended by the learned counsel for the revenue that the limitation should commence to run from the first rectification order of May 21, 1965, even then, what was sought to be rectified was the mistake which was committed by the Income-tax Officer in allowing the set off of the loss of assessment year 1954-55 against the business income of the petitioner-company for the relevant assessment year 1961-62. In the aforesaid first rectification order of May 21,1965, the Income-tax Officer had taken the same amount, namely, Rs. 12,39,626, as loss for assessment year 1954-55. It, therefore, cannot be said that what was sought to be done by the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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