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TMI Blog2014 (4) TMI 1064X X X X Extracts X X X X X X X X Extracts X X X X ..... not permitted by law. In order to amend an order under the powers of rectification of mistake conferred on the Tribunal by law the mistake should be apparent from record and appreciable without a detailed exercise for discovery thereof. Contentions in the Misc. Application shows that detailed exercise is called for by the Appellant to appreciate the facts and circumstances of the case. Such exercise is permissible only if power of review is conferred on the Tribunal. But such a power is absent in the scheme of the law of Excise. Court specifically held that recalling the entire order would mean passing of a fresh order. That does not appear to be the legislative intent. In view of the provisions and judicial pronouncement indicated hereinabove, Hon’ble Court held that the power to rectify a mistake under Section 254(2) cannot be used for recalling the entire order. No power of review has been given to the Tribunal under the Income-tax Act. Thus, what it cannot do directly cannot be allowed to be done indirectly. If the assessee was aggrieved, it was open for him to approach the appropriate forum without asking the Tribunal review the entire judgment delivered by it earlier in pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the appeal on merit by a review. 5. Law is well-settled that it is not permissible for anyone to reopen a proceeding by a modification application for review of the earlier order in disregard of the statutory bar of review. A three judges Bench of Apex Court in the case of Major Chandra Bhan Singh - (1979) 1 SCC 321 following the precedent in Harbhajan Singh v. Karam Singh, (1966) 1 SCR 817 approving the earlier privy counsel decisions on Baijnath Ram Grenka v. Nand Kumar Singh - 40 IA 54 : ILR 40 Cal 552 : 15 Bom LR 500; Ananth Raju Shetty v. Appu Hegade - AIR 1919 Mad. 244; Patel Chunibhai Dajibhai v. Narayan Rao Jambekar - AIR 1965 SC 1457 held that review is a creature of statute but not an inherent power and cannot be entertained in the absence of a statutory provision in that regard. So also want of jurisdiction to review could not be cured by waiver and Court is not obliged to grant relief to a party disentitled to the same. It has further been reiterated in the case of Kalabharati Advertising v. Hemant Vimal Nath Narithania and Others - (2010) 9 SCC 437 that unless the statute or rules so permit, a review application is not maintainable against judicial or quasi-judi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reviewed, in Patel Narshi Thakershi Ors. v. Pradyumansinghji Arjunsinghji, (1971) 3 SCC 844, dealing with the provisions of the Saurashtra Land Reforms Act, 1951 and referring to Order 47, Rule 1 of the Code of Civil Procedure, 1908, Apex Court held that there is no inherent power of review with the adjudicating authority if it is not conferred by law. The view in Patel Narshi Thakershi has been reiterated by Apex Court in several cases. 9.1 The main question raised by applicant is : What is a mistake apparent from the record ? Now, a similar expression error apparent on the face of the record came up for consideration before Courts while exercising certiorari jurisdiction under Articles 32 and 226 of the Constitution. In T.S. Balaram v. Volkart Brothers, Bombay, (1971) 2 SCC 526. Apex Court held that any mistake apparent from the record is undoubtedly not more than that of the High Court to entertain a writ petition on the basis of an error apparent on the face of the record . It was, however, conceded in all leading cases that it is very difficult to define an error apparent on the face of the record precisely, scientifically and with certainty. 9.2 In the leadi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e powers of rectification of mistake conferred on the Tribunal by law the mistake should be apparent from record and appreciable without a detailed exercise for discovery thereof. Contentions in the Misc. Application shows that detailed exercise is called for by the Appellant to appreciate the facts and circumstances of the case. Such exercise is permissible only if power of review is conferred on the Tribunal. But such a power is absent in the scheme of the law of Excise. 12. It is of course not easy to define or adequately describe what is a mistake apparent from record. But what that can be rectified is to be appreciable by a cursory glance to the order and should be apparent therefrom. Hon ble Supreme Court has time and again held that the rectifiable mistake must be patent mistake and discovery thereof is not from elaborate argument. For such proposition of law reference may be made to the decision in M/s. Mapco Industries Ltd. v. Commissioner of Income Tax Anr. reported in 2009-TIOL-121-SC-IT-LB. While deciding the case of M/s. Mapco Industries Ltd., Hon ble Supreme Court has also reiterated the law laid down in the case of Deva Metal Powders Pvt. Ltd. v. Commissioner, T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e so ex facie and it is incapable of argument or debate. It, therefore, follows that a decision on a debatable point of law or fact or failure to apply the law to a set of facts which remains to be investigated cannot be corrected by way of rectifications. A mistake which can be rectified under Section 35C(2) of the Act is one which is patent, which is obvious and whose discovery is not dependent on argument or elaboration. Rectification of an order does not mean obliteration of the order originally passed and its substitution by a new order. What the appellant intends to do in the present case is precisely the substitution of the order which according to law is not permissible under the provisions of Section 35C(2) of the Act. In order to bring an application under Section 35C(2) of the Act, the mistake must be apparent from the record. Section 35C(2) of the Act does not enable an order to be reversed by revision or by review, but permits only some error which is apparent on the face of the record to be corrected. Where an error is far from self-evident, it ceases to be an apparent error. It is, no doubt, true that a mistake capable of being rectified under 35C(2) of the Act is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that if Hon ble Supreme Court has construed the meaning of a section, then any decision to the contrary given by any other authority must be held to be erroneous and such error must be treated as an error apparent on the record. In the case of Commissioner of Central Excise, Mumbai v. Bharat Bijlee Limited - 2006 (198) E.L.T. 489 (S.C.) it has been held that failure to take into consideration the material evidence which was present on the record, would certainly amount to mistake apparent on the face of the record and the Tribunal under the circumstances would have the jurisdiction to correct the said mistake in exercise of its powers under Section 35C(2) of the Act. 18. In the case of Honda SIEL Power Products Ltd. v. Commissioner of Income Tax, Delhi - 2008 (221) E.L.T. 11 (S.C.) = 2008 (9) S.T.R. 117 (S.C.) it has been held that the expression rectification of mistake from the record occurs in Section 154. It also finds place in Section 254(2). The purpose behind enactment of Section 254(2) is based on the fundamental principle that no party appearing before the Tribunal, be it an assessee or the Department, should suffer on account of any mistake committed by the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... record in the case of Satyanarayan Laxminarayan Hegde v. Mallikarjun Bhavanappa Tiruymale [AIR 1960 SC 137] need to be noted : An error which has to be established by a long drawn process of reasoning on points where there may conceivably be two opinions can hardly be said to be an error apparent on the face of the record. Where an alleged error is far from self-evident and if it can be established, it has to be established, by lengthy and complicated arguments, such an error cannot be cured by a writ of certiorari according to the rule governing the powers of the superior Court to issue such a writ. 20. It has been held by the Hon ble Supreme Court in the case of Commissioner of Income Tax, Mumbai v. Ralson Industries Ltd. - 2007 (214) E.L.T. 166 (S.C.) = 2007 (7) S.T.R. 497 (S.C.) that power of review and/or rectification is not akin to an administrative power. An administrative function and judicial function operate in two different places. Whereas a judicial function must be exercised by the authority invested therewith in terms of the provisions of the statute and on the basis of the materials on record; an administrative order may although inter alia have to be passe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by an erroneous decision is reheard and corrected, but lies only for patent error. Where without any elaborate argument one could point to the error and say here is a substantial point of law which states one in the face and there could reasonably be no two opinions entertained about it, a dear case of error apparent on the face of the record would be made out. 22. Certainly mandatory provision of the statute cannot be given go bye following the principles of law laid down in Addl. CIT v. Ubdua Tin Industries (P.) Ltd. - 166 ITR 454 (Kar.) at page 465 holding that to attract the provisions of Section 154 of the Act, there must be mistake and it must be a mistake apparent from the record. Overlooking a mandatory provision of law which leaves no discretion to the taxing authorities like admission to tax, surcharge or interest is a mistake apparent from the record [Swadeshi Cotton Mills Co. Ltd. v. ITO - (1966) 60 ITR 720 (All); M.K. Venkatachaiam, ITO v. Bombay Dyeing and Manufacturing Co. Ltd. - (1958) 34 ITR 143 (S.C.)]. which calls for rectification of mistake. But present case is not so. 23. Similarly if no order is passed in accordance with and subject to the provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the reported judgment held that the power intended to be given under Section 154 is to rectify an error apparent on the face of the record. Amendment of the order is the consequence of the rectification and its purpose is to give effect to the rectification. If the rectification involves an amendment, which will affect the whole of the order, it cannot be said that simply because of the use of the word amend , which normally may not mean the cancellation of the whole order, the Income-tax Officer should be powerless to rectify the mistake or error which is apparent on the face of the order. The word amend with reference to legal documents means correct an error and the expression amend the order would mean correct the error in the order. Under Section 154 power to rectify the error is to be exercised by correcting the error in the order and the correction must, therefore, extend to the elimination of the error. What the effect of the elimination of the error will be on the original order will depend upon each case. It may be that the elimination of the error may affect only a part of the order. It may also be that the error may be such as may go to the root of the order and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in the case of Karan and Co. v. ITAT - (2002) 253 ITR 131. a Division Bench of the Hon ble Court pointed out the scope and ambit of an application under Section 254(2) as follows : The scope and ambit of application of Section 254(2) is very limited. The same is restricted to rectification of mistakes apparent from the record. We shall first deal with the question of the power of the Tribunal to recall an order in its entirety. Recalling the entire order obviously would mean passing of a fresh order. That does not appear to be the legislative intent. The order passed by the Tribunal under Section 254(1) is the effective order so far as the appeal is concerned. Any order passed under Section 254(2) either allowing the amendment or refusing to amend gets merged with the original order passed. The order as amended or remaining unamended is the effective order for all practical purposes. The same continues to be an order under Section 254(1). That is the final order in the appeal. An order under Section 254(2) does not have existence de hors the order under Section 254(1). Recalling of the order is not permissible under Section 254(2). Recalling of an order automatically nec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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