2011 (2) TMI 1461 - AT - Income Tax

ITAT Pune: Rectification Application Allowed for Mistake in Order

The Appellate Tribunal ITAT Pune allowed the application for rectification of a mistake apparent from the record in the Tribunal's order dated 11.6.2010. ... Mistake apparent on record - rectification under Section 254(2) of the Act - prohibition on review of tribunal order under Section 254(2) - award of costs under Section 254(2B) of the I.T. Act, 1961Mistake apparent on record - rectification under Section 254(2) of the Act - Ground No. 3 of the appeal had remained undecided in the Tribunal's order dated 11.6.2010 and a mistake apparent on the face of the record required rectification. - HELD THAT: - The Tribunal accepted the assessee's submission that Ground No. 3 was not adjudicated in its order dated 11.6.2010, thereby constituting an apparent mistake on the face of the record. The Revenue's contention that the appeal had been disposed of on the merits and that permitting the application would amount to a prohibited review under Section 254(2) was considered, but the Tribunal found that the omission of adjudication on Ground No. 3 was a procedural defect susceptible of correction under the rectification power. Consequently, the Tribunal exercised its power to correct the record by directing that the appeal be placed before it for hearing on the issue raised in Ground No. 3 so that the omitted ground may be adjudicated and the order dated 11.6.2010 rectified.Application allowed; Registry directed to fix the appeal for hearing on Ground No. 3 for adjudication and rectification of the order dated 11.6.2010.Award of costs under Section 254(2B) of the I.T. Act, 1961 - prohibition on review of tribunal order under Section 254(2) - The claim for a substantive order awarding costs under Section 254(2B) was not acceded to at this stage; the application for rectification was confined to securing adjudication of the omitted ground rather than reviewing the earlier merits decision. - HELD THAT: - The Tribunal noted the assessee's prayer for a substantial cost under Section 254(2B) arising from the alleged ignoring of binding decisions in the first appellate order. The Revenue opposed the application on the ground that the appeal had already been allowed on merits and that allowing the present application would amount to a review. The Tribunal, however, confined its order to correcting the omission by directing rehearing on Ground No. 3; it did not decide on the substantive entitlement to costs under Section 254(2B), which thus remains a matter for adjudication once the ground is heard.No determination on award of costs; rectification ordered only to enable adjudication of Ground No. 3.Final Conclusion: The Tribunal found an apparent omission in its order dated 11.6.2010 in respect of Ground No. 3, allowed the rectification application, and directed the Registry to list the appeal for hearing on that ground so the order may be corrected; no substantive decision was made on the claim for costs. Issues involved: Rectification of mistake apparent from record in the order of the Tribunal u/s 254(2) of the IT Act 1961.Summary:The judgment by the Appellate Tribunal ITAT Pune involved the consideration of an application for rectification of a mistake apparent from the record in the Tribunal's order dated 11.6.2010. The Applicant contended that Ground No. 3 raised in the appeal had not been adjudicated by the Tribunal, leading to an error in the order. The Applicant argued that serious injustice, prejudice, and harassment had been caused due to the first appellate order ignoring binding decisions, and requested a substantial cost u/s. 254(2B) of the IT Act 1961. The Respondent opposed the application, stating that the Tribunal had already decided the issues in Ground Nos. 1 & 2 in favor of the assessee, and allowing the application would amount to a review not permitted under Section 254(2) of the Act.Upon considering the submissions, the Tribunal found merit in the contention that Ground No. 3 had not been adjudicated in the previous order, leading to an apparent mistake. The Tribunal allowed the application and directed the Registry to fix the appeal for hearing on the issue raised in Ground No. 3 for rectification of the order dated 11.6.2010. As a result, the application was allowed, and the order was pronounced in the open Court on 9th February 2011.