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TMI Blog1971 (5) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... ome-tax is payable in Pakistan. Its head office is, however, located in Calcutta. Naturally, its business is controlled and managed wholly from the taxable territories as defined in the Indian Income-tax Act. The result is that its income arising from manufacture and sale of tea was assessed under the Indian Income-tax Act, 1922. In the assessment for the tax years 1951-52, 1955-56 and 1956-57 the assessee has been treated as a resident company. As such, the assessee was entitled to deduction from the Indian income-tax payable by it in respect of the said assessment years certain sums to be calculated in accordance with the provisions of section 49D(3) of the Indian Income-tax Act, 1922. This sub-section reads thus : " If any person who is a resident in the taxable territories in any year proves that in respect of his income which accrues of arises to him during that year in Pakistan he has paid in that country, by deduction or otherwise, tax payable to the Government under any law for the time being in force in that country relating to taxation of agricultural income, he shall be entitled to a deduction from the Indian income-tax payable by him-- (a) of the amount of tax paid in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ef due under the other provisions of the Act ", and, as such, had got to be deducted from the gross tax in calculating the Indian rate of tax within the Explanation to section 49D(3). The Appellate Assistant Commissioner by a consolidated order made on August 2, 1963, dismissed all the appeals by upholding the Income-tax Officer's orders passed under section 154. The Appellate Assistant Commissioner agreed with the Income-tax Officer that the A.A.D.T. itself had been made under the powers conferred by section 49A of the Act of 1922 and, as such, any relief under the agreement could not be considered to be other than a relief under section 49A. He came to the conclusion that relief under the A.A.D.T. is nothing but relief under " other provisions of this Act. " The said relief, therefore, according to him, must be deducted from the total amount of the Indian income-tax in calculating the Indian rate of tax. The Appellate Assistant Commissioner was also of opinion that what the Income-tax Officer had originally done in calculating the relief under section 49D(3) for each of the years was clearly a mistake apparent from the record and, as such, could be rectified under section 154 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 35 of the old Act do not confer any power on the Income-tax Officer to rectify the mistake which is not apparent from the records but " may be discovered by a complicated process of investigation, argument or proof ". In this connection the Tribunal also referred to the Supreme Court's decision in M. K. Venkatachalam, Income-tax Officer v. Bombay Dyeing and Manufacturing Co. Ltd. in which the same principle was laid down, namely, that only a glaring and obvious mistake of law could be rectified under section 35. The Tribunal was of opinion that the mistakes attempted to be rectified in the instant case were not apparent from the records and they could not be corrected under section 154. The following questions of law have been referred to this court : " (1) Whether, on the facts, and in the circumstances of the case, the Tribunal was right in holding that the Income-tax Officer who had made the original assessment had not committed any glaring and obvious mistake of law while granting relief under section 49D(3) of the Indian Income-tax Act, 1922, and that accordingly the provisions of section 154 of the Income-tax Act, 1961, were not applicable to the case ? (2) If the answer t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scuss the second and the third contentions of Mr. Basu. So far as the second point is concerned, the expression " mistake apparent from the record " and similar other expressions have been judicially construed on a number of occasions. It may be a mistake of law or fact. But, it must be a clear (be apparent) or self-evident mistake. If the discovery of a mistake calls for elaborate investigations either as to the legal position or the facts involved, it would not be a mistake apparent from the record. Broadly speaking, it can be stated that in a case where two views are possible you cannot take one of these views and proceed to rectify a so-called mistake on the basis of that view. That would not be rectifying a mistake apparent from the record. We intend in this connection to refer to two of the comparatively recent judgments of our Supreme Court in Satyanarayan Laxminarayan Hegde v. Mallikarjun Bhavanappa Thirumale, where it is stated: " 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. As the above discussion of the rival contentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax which has been assessed and has not appealed against the order of assessment, which has become binding, he cannot obtain any advantage under the " Agreement ". There is no machinery for making an application for " abatement " in such a case, or for applying for a refund. This court has held further that there is material difference between the provisions of sections 49A and 49AA of the Indian Income-tax Act, 1922. Section 49A provides for relief in certain cases where income-tax has already been paid, both in India and in a foreign country, on the same income which had been charged to tax in both countries. Section 49AA, however, does not grant relief against double taxation which has already taken place, but provides for the avoidance of double taxation. In the former case, says this court, tax has first to be paid, and then only arises the right to apply for a refund of the excess payment. In the latter case, this court points out, provision has been made for avoiding double taxation. It is true that in the last paragraph of this judgment, as pointed out by Mr. A. K. Basu, it has been stated " Doubtlessly the assessee was confused as regards its rights to relief against doub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... improperly made either under section 154 or under section 35. In other words, an argument that section 154 does not apply is different from an argument that it does apply but certain consequences should follow. The first question in this reference is an impediment to Mr. Basu's argument. A question relating to the competence of the reference is an entirely new question which this court is being invited to answer. Moreover, in the Madras case the point as to the propriety of the reference was raised by the respondent who was opposing the reference. Here, strangely enough, it is the applicant who wants us to say that the reference is incompetent. To us it seems that this argument of Mr. Basu cannot be sustained principally for four reasons : Firstly, the Income-tax Officer made his order not under section 35 of the old Act but under section 154 of the Act of 1961. Prima facie, therefore, his order was an appealable order. Secondly, the point that Mr. Basu is trying to raise in his argument in this court as to the maintainability of the appeal was never raised either directly or indirectly or even remotely before the Tribunal and this court in the exercise of its jurisdiction under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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