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TMI Blog2013 (12) TMI 1313X X X X Extracts X X X X X X X X Extracts X X X X ..... 85. 2. These appeals were admitted on the following substantial questions of law:- "(1) Whether on the facts and in the circumstances of the case the Income Tax Appellate Tribunal was correct in law in recalling its earlier order dated 17th January, 2001? (2) Whether on the facts and in the circumstances of the case the Income Tax Appellate Tribunal was correct in law in accepting the assessee's plea that there was a prima-facie mistake in the order of the Income Tax Appellate Tribunal and it should be recalled." 3. We have heard Sri Shambhu Chopra, counsel for the appellants and Sri Suresh Gupta for the respondents. 4. Brief facts of the case are that the assessee had got first prize of the Sikkim Lottery. Tax amounting to Rs.3,68,088 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vernment of India. The tax deducted at source is one of the mode of collection of taxes and there being no collection to the credit of Government of India, there is no question of credit of the same by the A.O. Hence, there was a clear mistake of law which the A.O. Rectified u/s 154 by withdrawing the credit of tax deducted by the Sikkim State Government in lieu of 58 ITD 53 and 119 ITR 142." 7. Subsequently, the assessee filed a miscellaneous application before the Income Tax Appellate Tribunal and after considering the said application, the Tribunal has recalled its earlier order dated 17.1.2001. 8. The Income Tax Appellate Tribunal after re-hearing the appeal decided it afresh by its order dated 31.8.2001 and dismissed the department's ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ke and allowed the credit of sum of Rs.3,68,088/- being the tax deducted at source by Sikkim Government but subsequently after giving a show cause notice, the said credit of tax deducted at source was withdrawn. 12. Section 154 of the Income Tax Act, 1961 provides as follows:- "Rectification of mistake. 154. (1) With a view to rectifying any mistake apparent from the record an income-tax authority referred to in section 116 may, - (a) amend any order passed by it under the provisions of this Act; (b) amend any intimation or deemed intimation under sub-section (1) of section 143. (c) amend any intimation under sub-section (1) of section 200A." 13. Learned counsel for the assessee has placed reliance on Nirmala L. Mehta Vs. A. Balasubr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmala L. Mehta (supra) and has respectfully disagreed with them on the ground that their attention was not invited towards Section 5 of the Income Tax Act. 15. We also respectfully disagree with the law laid down by High Court of Bombay in Nirmala L. Mehta's case because the assessee in the present case is resident of India and he has won the lottery prize at Kanpur and accordingly as per provisions of Section 5 of the Income Tax Act, 1961 the total income received by the assessee is liable to be taxed as per the provisions of Income Tax Act, 1961. 16. Learned counsel for the respondent has argued that provisions of Section 5 of Income Tax Act, 1961 will not apply because the Income Tax Act does not apply to Sikkim. This argument is misco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1961 or not, the Sikkim Government had clarified the position to the assessee as follows:- "There is no special provision in respect of remittance sent to India on account of winning of Sikkim Lottery and no such agreement exists between Government of Sikkim and Government of India. Therefore, Income-tax already deducted at source and paid to this Department is within the standing rules of this Department. You may get the relief of double taxation on the basis of certificate issued from this Department." 21. In the present case the Assessing Officer had concluded that the assessee was wrongly allowed credit of tax deducted by the Government of Sikkim and thus by exercising powers under Section 154 of the Income Tax Act withdrew the cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctifiable after giving an opportunity of hearing. The opportunity of hearing was extended to the assessee and after considering all the aspects, the A.O. had rectified the mistake. Thus, we do not find any illegality in invoking the provisions of Section 154 of the Income Tax Act, 1961. 25. Accordingly, we hold that in the facts and circumstances of the case, the Income Tax Appellate Tribunal was not correct in law in recalling its earlier order dated 17.1.2001. The substantial questions of law are accordingly decided in favour of revenue and against the assessee. 26. In the facts and circumstances of the case, we are of the opinion that because the credit of T.D.S. was wrongly given to the assessee which was subsequently rectified invoki ..... X X X X Extracts X X X X X X X X Extracts X X X X
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