2025 (3) TMI 982 - AT - Income Tax

Tribunal Rejects Assessee's Applications; Non-Adjudication of TDS Credit Not a Mistake Under Section 254(2) of Income-tax Act.

Karuppannan Thulasimani Versus The Income Tax Officer, Ward-1 (1), Erode.

The Tribunal dismissed the assessee's Miscellaneous Applications, determining that the non-adjudication of the TDS credit issue did not qualify as a ... Rectification of mistake u/s 254 - non-adjudication of the ground of appeal concerning the grant of TDS credit by the CIT(A) - HELD THAT:- As assessee is entitled for credit of TDS in view of section 199 of Income Tax and the AO is duty bound to allow the same as per Rule. Coming to the MA, we find that the assessee has not raised the specific ground for grant of TDS in Form-36 before us. AR has also not argued this ground during the course of hearing. We therefore are of the opinion that if the assessee has neither raised a specific ground, nor argued it before the ITAT, the Tribunal cannot be expected to adjudicate the matter. As per Section 254(2) of the Act, the scope of MA is limited to rectify apparent mistakes in the order of ITAT. An error must be apparent on the face of record and not require extensive arguments or deliberation. As in the case of ACIT v. Saurashtra Kutch Stock Exchange Ltd [2008 (9) TMI 11 - SUPREME COURT] has clarified that a mistake apparent from record must be obvious and patent and not something that requires investigation or arguments. As the assessee has not raised the issue as a specific ground of appeal, nor the AR argued this issue during ITAT hearing, the MAs filed by the assessee are dismissed. ISSUES PRESENTED and CONSIDEREDThe core legal questions considered by the Tribunal were:Whether the non-adjudication of the ground of appeal concerning the grant of TDS credit by the CIT(A) and subsequently by the ITAT constitutes a mistake apparent from the record under Section 254(2) of the Income-tax Act, 1961.Whether the Tribunal is obliged to adjudicate on issues not specifically raised or argued before it.ISSUE-WISE DETAILED ANALYSISRelevant legal framework and precedentsThe legal framework revolves around Section 254(2) of the Income-tax Act, 1961, which allows the Tribunal to rectify any mistake apparent from the record. The Tribunal referred to the precedent set by the Hon'ble Supreme Court in CIT vs. Scindia Steam Navigation Co Ltd, which established that the Tribunal, as a judicial body, cannot decide issues not specifically raised before it. Additionally, the case of ACIT v. Saurashtra Kutch Stock Exchange Ltd. was cited, clarifying that a mistake apparent from the record must be obvious and not require extensive argumentation.Court's interpretation and reasoningThe Tribunal interpreted that the scope of Section 254(2) is limited to rectifying mistakes that are apparent on the face of the record. It emphasized that for a matter to be adjudicated, it must be specifically raised and argued by the parties involved. The Tribunal noted that the assessee did not explicitly raise the issue of TDS credit as a specific ground in the appeal form (Form-36) nor was it argued during the hearing. Therefore, the Tribunal cannot be expected to adjudicate on such matters.Key evidence and findingsThe Tribunal observed that the assessee had indeed raised the issue of TDS credit in the appeal before the CIT(A), but it was not specifically brought up in the appeal to the ITAT. The Tribunal found no evidence of the issue being argued by the Authorized Representative during the ITAT hearing, which was crucial for the Tribunal to consider the matter.Application of law to factsApplying the legal principles, the Tribunal concluded that since the issue of TDS credit was neither explicitly raised as a ground of appeal nor argued before it, there was no mistake apparent from the record that could be rectified under Section 254(2). The Tribunal reiterated that it is not within its purview to adjudicate on issues not presented before it.Treatment of competing argumentsThe Tribunal acknowledged the submissions made by the assessee's Authorized Representative regarding the non-adjudication of the TDS credit issue by the CIT(A) and the ITAT. However, it emphasized that the responsibility lies with the assessee to ensure that all relevant grounds are raised and argued. The Tribunal dismissed the argument that non-adjudication by the ITAT constituted a mistake apparent from the record, as the issue was not specifically raised or argued.ConclusionsThe Tribunal concluded that the Miscellaneous Applications filed by the assessee did not meet the criteria for rectification under Section 254(2) of the Act. Since the issue was not specifically raised or argued before the ITAT, there was no apparent mistake on record to rectify. Consequently, the applications were dismissed.SIGNIFICANT HOLDINGSPreserve verbatim quotes of crucial legal reasoningThe Tribunal held: 'As per Section 254(2) of the Act, the scope of MA is limited to rectify apparent mistakes in the order of ITAT. An error must be apparent on the face of record and not require extensive arguments or deliberation.'Core principles establishedThe Tribunal cannot adjudicate on issues not specifically raised or argued before it.The scope of rectification under Section 254(2) is limited to mistakes that are apparent and do not require detailed examination or argumentation.Final determinations on each issueThe Tribunal dismissed all four Miscellaneous Applications filed by the assessee, concluding that the non-adjudication of the TDS credit issue did not constitute a mistake apparent from the record under Section 254(2) of the Income-tax Act, 1961.