TaxTMI 
TaxTMI 
2013 (8) TMI 410
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....e has been assessed at Rs.12,83,00,230/- by making addition of Rs.12,92,82,788/- on account of provisions of interest written back and relief in loan from SBI and Madhya Pradesh Financial Corporation (MPFC). Issues of credit of brought forward losses/depreciation, write off etc., as assessed by the A.O. have again been raised by the assessee in its application under Section 154 of the Act. The same have been rejected by the A.O. vide order dated 29.02.2008. On appeal before the CIT(A), vide order dated 23.07.2008 in Appeal No. 316 & 318/IT/07-08/Gwl against order under Section 143(3) & 154, the said addition has been deleted. Accordingly, vide order dated 26.08.2008 passed under Section 250 of the Act to give effect to the appeal order, assessment has been made at declared loss of Rs.9,81,556/- by the A.O. 3. As per impugned order under Section 154 of the Act, A.O. has mentioned that non assessment of income under Section 115JB to the extent of Rs.12,04,46,195/-, while giving appeal effect under section 250 of the Act, has resulted in short levy of tax and interest. Accordingly, show cause notice dated 02.11.2011 under Section 154 of the Act has been issue to rectify above mention....
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....t) was applicable in the interest of revenue. So apparent from record does not cover only the appeal effect order u/s 250 but it also cover the entire proceeding and document from sending the notice u/s 143(2) to appeal effect order u/s 250 which also was passed by the A.O. There is no invariable Rule of law, to constitute an "error apparent from the record", the error must be apparent from the record of the proceeding against the assessee himself. This statement can be supported in the following case law "Devendra Prakash Vs. ITO (All) 72 ITR 151". At the time of initiating the proceedings u/s 154 the record which was in favour of applying the section 115JB was/is available with the income tax authorities. This case record is very sufficient documentary evidence to initiate the proceedings u/s 154. Record for the purpose of 154 is the record available to the authorities at the time of initiation of 154 proceedings and not merely the misc. record for that year alone. The reliance is placed upon in the following case laws: CIT Vs. M.R.M. Plantations Pvt. Ltd. (Mad) 240 ITR 660 CIT Vs. Aruna Luthra (P&H) 252 ITR 76 Many times a very relevant and big issue is escaped due to inavoi....
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...., therefore, illegal and the same may kindly be cancelled. The Supreme Court in CIT Vs. Hero Cycles (P) Ltd. 228 ITR 463 held that rectification u/s 154 can only be made when glaring mistake of fact or law has been committed by the officer passing the order & it becomes apparent from records. There was no order computing the book profit & therefore question of rectification u/s 154 of computation of book profit does not arise. Computation of book profit and tax thereon u/s 115JB is just automotive. An AO is required to apply his mind as various adjustments are to be made and set off of losses and unabsorbed depreciation is to be made. The AO has also to see whether the P&L A/c has been prepared in accordance with part II & III of schedule VI of the Companies Act & it involves deep examination & is not covered an apparent and patent mistake of law. If the AO had computed the book profit & tax thereon u/s 115JB involving some calculation mistake, the things were otherwise, here the facts are quite different and distinguishable. The S.C. case of T.S. Balaram as cited by A.O. is in favour of assessee and does not support revenues case. Without prejudice to above, it is submitted tha....
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....er records, it is accompanied by audit report inform no.3CA, 3CD & also audit report in Form No.29B whereby it has been certified by the auditors that tax payable u/s 115JB of the I.T. Act, in respect of the assessment year under consideration i.e. 2005-06 is Rs.NIL which has been determined on the basis of the enclosed details in Annexure 'A' to the said Form No.29B. A.O. has passed order dated NIL u/s 143(3) by making addition/disallowance on account of provision of interest write back of MPFC& SBI and of relief in loan to the appellant due to it being not sick industrial Co. as per BIFR order dated 20.05.2005 and has computed income at Rs.12,83,00,230/-. The said addition has been deleted by the then CIT(A) vide order dtd. 23.07.2008. In fact, even Hon'ble ITAT, Agra has also upheld the said decision of CIT(A), Gwalior vide order dtd. 21.11.2011 in ITA No.651/Agr/2008. Vide order dtd. 26.08.2008 passed u/s 250 to give effect to CIT(Appeals)'s order, A.O. has determined appellant's loss at Rs.9,81,556/- and has also determined position of appellant's carry forward losses as per following chart:- A.Y. Date of filing of Business loss Unabsorbed Total loss return (Intt. Claimed) dep....
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....there can be diverse opinions. 2.7 While passing order u/s 154, AO has relied on certain case laws stating that only issues considered and decided in appeal will merge. Therefore, the said mistake of non application of provisions of Sec. 115JB is apparent from record and can be rectified u/s 154, there being no debatable issue involved. Facts of the case laws relied on by the A.O. are found distinguishable from appellant's case in that though the issue of applicability of Sec. 115JB has not been raised in appeal but at the same time the reasons for it is that on the basis of details and audit report in prescribed Form No.29B stating it to be NIL no adverse inference has been drawn by the A.O. during the entire course of assessment proceedings and in the assessment order. 2.8 The power conferred by provisions of Sec. 154/155 is a power to correct mistakes and not a power of review. U/s 154, an A.O. cannot be permitted to revise or review his earlier order, there being no change in facts or circumstances and when entire material is before him during the course of original proceedings whether completed u/s 143(3) or u/s 250. It has been held by Hon'ble Apex court in case of CIT Vs. ....
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....ith the assessment year during which the entire net worth of such company become equal or exceeds accumulated loss, shall have to be reduced for computing income under Section 115JB of the Act which in the case of the assessee has been done by the Auditor. He has submitted all the facts before A.O. since beginning, therefore, after decision on merits by the CIT(A) and the Tribunal, A.O. is not empowered to pass order under Section 154 of the Act for the purpose of enhancing income of the assessee under the garb of above provision. 7. We have considered the rival submissions and do not find any justification to interfere with the order of the ld. CIT(A). Section 154 of the I.T. Act provides that with a view to rectifying any mistake apparent from record, the Income Tax Authority may amend any order passed by it. Therefore, there should be a mistake apparent from the record of the Income Tax Authorities while exercising jurisdiction under Section 154 of the Act. 7.1 Hon'ble Calcutta High Court in the case of Hindustan Lever Ltd. Vs. Commissioner of Income-Tax and others [2006] 284 ITR 42 (Cal) held that mistake must be obvious that it can be easily corrected, to wit an arithmetical....