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of <h1>Court Upholds Tribunal Decision Dismissing Tax Case Appeals; Rectification Denied Under Wealth Tax Act</h1> <h3>M/s. Sova (P) Ltd., Versus The Deputy Commissioner of Wealth Tax Special Range II Coimbatore</h3> M/s. Sova (P) Ltd., Versus The Deputy Commissioner of Wealth Tax Special Range II Coimbatore - TMI Issues:1. Whether the Tribunal was correct in holding that there was no mistake apparent from the record which needed rectification regarding the rate of tax applicable under the Wealth Tax Act.2. Whether the non-application of the correct provisions of the Act constitutes a mistake apparent from the record.Analysis:Issue 1:The assessee filed the return of income for the assessment year 1989-90 under the Wealth Tax Act, declaring a net wealth of Rs.18,15,700. Subsequently, the assessment was reopened, and additions were made. The assessee contended that as per Part II of Schedule I of the Wealth Tax Act, the rate of wealth tax would be nil for a loss-making company that had not declared dividends. The assessee sought rectification based on this provision. However, the Tribunal held that since the assessee did not claim the applicable tax rate during the assessment or appellate stage, there was no apparent mistake in the record to rectify.Issue 2:The assessee's rectification petition was rejected by the Deputy Commissioner of Income Tax and the Commissioner of Income Tax (Appeals) based on the grounds that the loss and non-declaration of dividends were not presented during the original assessment. The Tribunal emphasized that the facts were not before the Assessing Officer at the time of assessment and were only raised later based on a revised order. The Tribunal concluded that there was no mistake apparent from the record that warranted rectification. The Court agreed with the Tribunal, stating that the rectification was sought based on materials that were not part of the original record, making it legally unsustainable under Section 35 of the Wealth Tax Act.In conclusion, the Court dismissed the Tax Case Appeals, upholding the Tribunal's decision that the rectification sought by the assessee was not justified as the facts regarding loss and non-declaration of dividends were not part of the original assessment record.
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