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TMI Blog2015 (9) TMI 1288X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1961 (hereinafter called in short "the Act"). 2. It was further contended that the assessee-company has made a provision for bad and doubtful debts to arise sale of power @ 15% of the incremental basis and this policy has already been approved by the Board of Directors and as per provisions of section 36(1)(vii) of the Act, any bad debts are part thereof, which is written off as irrecoverable in the account of the assessee, should be allowed. It was further contended that as per guidelines of the Electricity Board to make provisions @ 15% of the doubtful debts due from the consumer and the said dues to be credited in the account code No.79.460 under the head bad and doubtful debts provided for dues from consumer and debited in the accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. 4. Having carefully examined the order of the Tribunal vis-à-vis the Miscellaneous Application, we find that the issue before the Tribunal was whether the provisions for bad and doubtful debts can be allowed under section 36(1)(vii) of the Act on the basis of approval of the Board of Directors of the assessee-company. The Tribunal has examined this issue in para 9 of its order and has given a categorical finding that the assessee has claimed deduction for bad and doubtful debts under section 36(1)(vii) of the Act; whereas this section deals with only actual claim of deduction. Since the Tribunal has taken into account all the arguments of the assessee while adjudicating the issue, we find no error apparent in the order of the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 ITR 296 their Lordships of the Punjab and Haryana High Court have held in specific terms that "the Appellate Tribunal is creation of statutes and it can exercise only those powers which have been conferred upon it. The only power conferred on the Tribunal u/s 254(2) of the I.T. Act, 1961 is to rectify any mistake apparent from record. The jurisdiction to review or modify orders passed by the authorities under the Act cannot be interfered with on the basis of supposed inherent rights. U/s 254(1) of the Act, the Appellate Tribunal, after hearing the contesting parties, can pass such order as it deems fit. Sec. 254(2) of the Act specifically empowers the Appellate Tribunal at any time within four years of the date of an order to amend any or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is no mistake which is patent and obvious on the basis of the record, the exercise of the jurisdiction by the Tribunal u/s 254(2) will be illegal and improper. An oversight of the fact cannot constitute an apparent mistake rectifiable under section 254(2). This might, at the worst, lead to perversity of the order for which the remedy available to the assessee is not under section 254(2) but a reference proceedings u/s 256. The normal rule is that the remedy by way of review is a creature of the statute and unless clothed with such power by the statute, no authority can exercise the power. 8. The Hon'ble High Court of Allahabad in the case of CIT Vs. ITAT; 143 CTR 446 has held that "sub-section (1) of section 254 confers ample powers o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Their Lordships have further held that if a statement of any person has been recorded without producing him in the witness box, the authorities should not act upon that statement without affording the assessee an opportunity to cross-examine the witness, but that is a matter not for rectification but it is a matter relating to the merits of the case as to whether the Tribunal has gone wrong in not considering the affidavit of a particular person and has acted upon the statement of the same person which was recorded by the ITO without being permitted to cross examine by the assessee. This is not a matter in which the apparent error is involved but it is a matter more of merit and cannot be rectified within the scope of rectification. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e creating it. The Tribunal does not have any power to review its own judgements or orders. The grounds on which the courts may open or vacate their judgements are generally matters which render the judgement void or which are specified in the statutes authorizing such sections. The language of section 254(2) of the Income-tax Act, 1961 is clear. The foundation for the exercising the jurisdiction is "with a view to rectify any mistake apparent on the record" and the object is achieved by "amending any order passed by it". 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 be conceivably two opinions. A decision on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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