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TMI Blog2013 (2) TMI 327X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner of Income Tax (Appeals) ? 2. Whether on the facts and in the circumstances of the case the Tribunal was right in upholding the order of rectification passed by the assessing officer which in effect nullifies the order of the Commissioner of Income Tax (Appeals) which has become final ? 3. Whether on the facts and in the circumstances of the case, the Appellate Tribunal was right in not holding that rectification under Section 154 of the Income Tax Act, 1956 cannot be done when there are two possible interpretations ? 3. The case of the Assessee was that the Assessee firm is having Manufacturing Division and Commission Agency Division. The assessee filed assessment for the years 1993-94 and 1994-95. The said returns were processed under Section 431(1)(a) of the Income Tax Act, 1961 and the Income declared by the assessee was accepted. Subsequent to the conclusion of the assessment, the assessee claimed commission payments in the manufacturing division as well as in the agency division. Even in the assessment submitted, the assessee claimed set-off against the commission receipts. The plea of the assessee was considered and the Assessing Officer chose t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer passed orders under the guise of rectification and claimed total tax payable at Rs.9,29,939/- for the assessment year 1993-1994 and Rs.19,65,438/- for the assessment year 1994-1995. The assessee preferred appeals before the Commissioner of Income Tax (Appeals) in ITA Nos.113/01-02 and 114/01-02. The said appeals were allowed by the Commissioner of Income Tax (Appeals) by order dated 9.7.2002, against which the Revenue filed ITA Nos.1515/2002 and 1516/2002 and the said appeals were allowed on 6.9.2005 in favour of the Revenue and restored the orders of the Assessing Officer. As against the said orders, these appeals are preferred. 6. The contention of the Assessee is that only the net commission be excluded and the said issue having been considered and final order having been passed, there is no error apparent on the face of the record to initiate rectification proceedings. The course adopted by the Assessing Officer was to nullify the specific direction given by the Commissioner of Income Tax (Appeals) and the proceedings initiated under Section 154 of the Income Tax Act, 1961 on the facts and circumstances of the case is illegal. 7. The learned counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be exercised' was already considered by the Hon'ble Supreme Court as well as by this Court in the following decisions. (a) In the decision reported in (1971) 82 ITR 51 (SC) : (1971) 2 SCC 526 (T.S.Balaram, Income-tax Officer v. Volkart Brothers), wherein in paragraphs 5 (in SCC) it is held thus, "5. .......... A mistake apparent on the record must be an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on which there may conceivably be two opinions. As seen earlier, the High Court of Bombay opined that the original assessments were in accordance with law though in our opinion the High Court was not justified in going into that question. In Satyanarayan Laxminarayan Hegde v. Millikarjun Bhavanappa Tirumale ((1960) 1 SCR 890) this Court while spelling out the scope of the power of a High Court under Article 226 of the Constitution ruled that an error which has to be established by a long drawn process of reasoning on points where there may conceivably be two opinions cannot be said to be an error apparent on the face of the record. A decision on a debatable point of law is not a mistake apparent from the rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee and the Revenue will continue to be governed by the order of the Tribunal. There is no justification for the action of the Inspecting Assistant Commissioner in interfering with the order of the Income-tax Officer giving effect to the order of the Tribunal in his order under section 154. The proposition that the order of the Income-tax Officer merely gives effect to the relief as directed by the Income-tax Tribunal cannot be doubted. But even then, what is important is that the source of that order is the order of the Tribunal which still remains final between the Revenue and the assessee. So far as the order of the Appellate Assistant Commissioner is concerned, even there, by parity of reasoning, the only authority which will be entitled to interfere with the order of the Appellate Assistant Commissioner by way of rectification is the Appellate Assistant Commissioner himself. The order of the Income-tax Officer granting relief under section 80J for the assessment year 1974-75 is only an order which is consequential on giving effect to the order of the Appellate Assistant Commissioner. Under the guise of exercise of power under section 154 of the Act, the directions g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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