2006 (2) TMI 59

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....g after notice to the parties. The controversy arises in the following circumstances 3 Shri Ratti Ram Gotewala was along with his family members carrying on business in sarees at Delhi and Calcutta. He was a partner in M/s. Rati Ram Ram Vinod and M/s Rati Ram Ram Vinod and Company, besides being a director in M/s. Rati Ram Saree Store Pvt. Ltd. He was also the proprietor of M/s. R. Rakesh Behari and Co. 4 A search was conducted at the residential and business premises of the group concerns mentioned above and various incriminating material including certain hundies depicting various transactions seized. Since the Income-tax Department was of the view that the transactions evidenced by the said documents related to undisclosed income o....

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.... Bansal v. Asst. CIT[2001 247 ITR (AT) 54, holding that the Tribunal could examine the validity of a search in an appeal filed before it under the Income-tax Act. The second reason why the Tribunal recalled its order was that the issue whether an assessment under section 158BC could be framed on the basis of estimation was debatable. Both these grounds were according to the petitioner, insufficient to justify an order of recall having regard to the language employed in section 254(2) of the Income-tax Act, which simply permits rectification of any mistake apparent from the record in contradistinction to a review which is implicit in an order of recall in toto. There is, in our view, considerable merit in that submission. The Income-tax Appe....

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....ssage from the decision of this court in Karan and Co. [2002] 253 ITR 131 elucidates the difference between review and rectification of an order made by the Tribunal (page 136) "The scope and ambit of application of section 254(2) is very limited. The same is restricted to rectification of mistakes apparent from the record. We shall first deal with the question of the power of the Tribunal to recall an order in its entirety. Recalling the entire order obviously would mean passing of a fresh order. That does not appear to be the legislative intent. The order passed by the Tribunal under section 254(1) is the effective order so far as the appeal is concerned. Any order passed under section 254(2) either allowing the amendment or refusing t....