Rectification for mistake apparent from record upheld where resident assessee wrongly received a non-resident wealth-tax rebate.

A resident but not ordinarily resident assessee could not claim a concessional wealth-tax rebate reserved for a non-resident individual who is not an Indian citizen. Grant of that concession on the basis of a non-resident status was an obvious and patent error, not a debatable issue of law, and was therefore a mistake apparent from the record. The Wealth-tax Officer was entitled to invoke the rectification power under section 35 and withdraw the concession.

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Issues: Whether the Wealth-tax Officer could rectify the assessment under section 35 of the Wealth-tax Act, 1957 by withdrawing the concessional rate granted to an assessee who was resident but not ordinarily resident, on the ground that the original grant of concession to her as a non-resident was a mistake apparent from the record.

Analysis: The concessional rebate under rule 3, Part II of Schedule I to the Wealth-tax Act applies only when the assessee is an individual, is not a citizen of India, and is not resident in India. The assessee's own returns showed her status as resident but not ordinarily resident, and under the scheme of the Wealth-tax Act a resident assessee and a non-resident assessee are distinct categories. A person who is resident, though not ordinarily resident, remains a resident and cannot be treated as a non-resident for the purpose of the rebate. The erroneous grant of the concession therefore involved an obvious and patent mistake, requiring no long drawn reasoning and raising no debatable question of law. The rectification power under section 35 was therefore correctly invoked.

Conclusion: The rectification was valid and the Tribunal was wrong in cancelling it.

Final Conclusion: The reference was answered in the negative, holding that the assessee was not entitled to the concessional rate as a non-resident and that the Wealth-tax Officer lawfully rectified the assessments.

Ratio Decidendi: Where an assessee shown to be resident but not ordinarily resident is granted a concession reserved for non-residents, the error is a mistake apparent from the record and is rectifiable under the rectification provision.

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