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TMI Blog1976 (2) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... n relating to the assessment year 1965-66. On the 18th March, 1970, the ITO made an assessment for the said year. In the assessment the petitioner had contended that the amounts realised by the petitioner from the sale of import entitlement were not income but capital receipts. The ITO negatived this contention. In this application, it is not necessary to refer to this aspect any further. It was contended alternatively that the petitioner was entitled to certain deductions as provided under s. 2(5)(a)(i) of the Finance Act, 1965, as the said receipts were income or profits derived from export of goods or merchandise out of India. The petitioner also contended that the petitioner was entitled to rebate under para. F(I)(b)(ii)(a) of Part I of the First Schedule to the said Finance Act, 1965. I will refer to the relevant provisions of the said clause. The petitioner contended that the income arising from the manufacture and sale of aluminium utensils are attributable to manufacture and production of aluminium so as to come within the relief granted by the said provision. The ITO, however, disallowed both these contentions. The assessee preferred an appeal before the AAC on 21st April, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n profits and gains derived from the export of any goods or merchandise outside India. Obviously, it appears to me that the Income-tax Officer has not correctly applied the provisions of the two Finance Acts. It is also seen that the Income-tax Officer applied the articles specified in Part III of the First Schedule of the Finance Act, 1965, i.e., aluminium, whereas the assessee was producing aluminium utensils from aluminium. This also appears to be an incorrect application of the Acts. " The petitioner had also moved an application under art. 226 of the Constitution challenging the said notice and a rule was issued being Matter No. 362 of 1974 [Jeewanlal (1929) Ltd. v. CIT [1977] 106 ITR 33 (Cal) ] which was discharged by me recently. The question involved in this case is whether in view of the nature of rectification proposed by the impugned notice dated 9th July, 1973, it can be said that the said rectification comes within the purview of s. 154 of the I.T. Act, 1961. Section 154 gives authority to the ITO to rectify any mistakes apparent from the record. The scope and effect of s. 154 has been judicially considered in several decisions. By judgment delivered on the 23 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the case of Tata Iron Steel Co. Ltd. v. N. C. Upadhyaya [1974] 96 ITR 1, the Division Bench of Bombay High Court held the same view but came to the conclusion that the mistake was obvious and patent in that case. The position, therefore, is that in order to attract the jurisdiction under s. 154 of the Act the mistake proposed to be rectified must be patent or apparent or obvious and on which there could not conceivably be two points of view. A mistake which has to be established by way of a process of reasoning or of investigation either on facts or by examination of the question of law on which there might conceivably be two views was not a mistake which came within the provisions of s. 154 of the Act. But whether the mistake sought or proposed to be rectified is a mistake which comes within the purview of the section must depend upon the facts and circumstances of each case. Bearing the aforesaid principles in mind the question involved in this application will have to be examined. In the instant case, two alleged mistakes were sought to be rectified (1) tax wrongly calculated at the rate applicable to priority income ; (2) export profit rebate wrongly allowed. In order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment in his affidavit in answer to the rule nisi to this court has stated that he mistook the order of the AAC with regard to its direction and allowed the relief granted and did not examine the question properly. I accept the submission of the ITO. But even in a case where an order has been passed by mistake or oversight and if the rectification of that order involves examination of a question or contention on which two views are conceivable, in such a case, in my opinion, s. 154 is not an authority to review the previous order and rectify the mistake. So far as the second alleged mistake proposed to be rectified is concerned, the same relates to para. " F " (I)(b)(ii)(a) of Part I of the First Schedule to the Finance Act, 1965. This provides for rebate on so much of the total income as constituted profits or gains attributable to the business of generation or distribution of electricity or of construction, manufacture or production of any one or more of the articles or things specified in the list of articles and things and item (2) of the said Part III runs as follows : " (2) Aluminium, copper, lead and zinc (metals). " The question in this case is whether the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X
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