TaxTMI 
TaxTMI 
1990 (6) TMI 221
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.... to the unexpected fluctuation in export sale of cashew kernels and also due to the restrictions imposed by the State Government in procurement of raw cashewnuts by directing that only the Co-opertaive Marketing Federation shall procure raw cashewnuts in the State under the Monopoly Procurement Scheme and fixing high purchase price. The fixation high minimum wages and bonus to the large number of factory workers by the Government added to the plight of the company....I may also bring to your kind notice that the company had been remitting monthly instalments of Rs. 1 lakh each to wards income-tax from May,1985 and Rs. 50,000 each to wards surtax from January, 1986 till October, 1986. However since the CIT, Central Circle, Bangalore directed that the entire balance of tax be remitted in lumpsum and refused to issue further challans for remittance of the monthly instalments, the company was not about the make subsequent remittances. The default in remittance of tax dues has arisen only from November, 1986 and due to the continuing stringent financial conditions the company was not able to make any further tax remittance.....The Indian Overseas Bank, Quilon, was giving the company fin....
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....gross neglect, misfeasance or breach of duty on the petitioner's part in relation to the affairs of the company. These aspects have not been taken into account by the CIT when he passed Ext. P15 order and thereby affirmed the declaration made by the first respondent (Ext. P13) that the petitioner being a director of the company which is a private company within the meaning of s. 179, is jointly and severally liable for the tax dues of the company, the counsel argues. He accordingly submits that Exts. P13, P15 and P18 are liable to be quashed. 4. Sri. P.K. Raveendranatha Menon, the learned counsel for the Revenue refuted the above argument of the counsel for the petitioner. He submits that the argument of the petitioner that the company at the relevant time had become a public company within the meaning of s. 43(1A) of the Companies Act, was for the first time raised only in her application under s. 154 of the IT Act. The documents in proof of this case, particularly Ext. P1, the letter of the Registrar of companies stating that the certificate under s. 43(14) is enclosed therein, indisputably were produced only alongwith the application under s. 154. It is thus clear that th....
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.... him provided it is established that the mistake is one apparent from the record [See Venkatachalam vs. Bombay Dyeing & Mfg. Co. Ltd. (1958) 34 ITR 143(SC)] The power thus conferred is confined to rectifying mistakes in the order passed by the Commissioner himself. To say that a mistake is apparent from the record, the same must, therefore, be an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on which there may conceivably be two opinion. Thus a decision no a debatable point of law cannot be said to be a mistake apparent from the record. [See Satyanaranyan vs. Mallikarjun AIR 1960 SC 137 and T.S. Balaram ITO vs. Volkart Bros. (1971) 82 ITR 50(SC).] Viewed from another angle the principle can be stated thus. The mistake must be something which appears to be so ex facie and is incapable of argument or debate. It therefore, follows that a decision on a debatable point of law or fact or failure to apply the law to a set of facts which remain to be investigated cannot be corrected by way of rectification. Alongside we have to keep in view what the word record means and implies in the contact. From the plain and unambi....
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....the Revenue has, for the time being, revealed a few facts. On an inspection of the document file (file No. 2292) of Rajmohan Cashews Ltd., Quilon, maintained in the office of the Register of Companies, it was notices by an officer of the Revenue that office copy of the letter No. 2292/PC/2C/R 850/77 dt. 26th Feb., 1977 addressed to Rajmohan Cashews (P) Ltd. Vadakkevila P.O., Quilon-10 which is marked as Ext. P1 is not available in the document file. The correspondence file, it is understood would not be made available for inspection. Details of certain order-sheet entries extracted from the document file are as under. Document Date of Order Details 23 22nd Jan., 1977 A/R. made up to 30 Dec., 1974 24 -do- Spl.Resolution passed on 30th Oct., 1973 25 -do- Spl.Resolution passed on 30th Dec., 1974 26 -do- Spl.Resolution passed on 12th May 1975 27 16th Dec., 1977 Particulars of charge created on 1st April 1975 for Rs. 6,00,000 28 11th March, 1977 A/R made up 31st Dec., 197 29 -do- A/R made upto 30th Dec., 1976. 10. From the above nothings in the order-sheet it appears that on 26th Feb., 1977 no such docu....
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....ohibited etc.) Coming to s. 179, only private companies were brought within its fold for obvious reason-tax evasion, habitual default in tax payment., etc., are to be expected from family group (private companies) and not Government undertaking. Hence as far as. s. 179 is concerned, it is irrelevant whether the company is a private company or a private company deemed to be a public company Suffice it to pay that s. 179 is to be resorted to when a family group will fully defaults tax payment out of gross negligence and breach of duty. To sum up, Raj Mohan cashews cannot by any stretch of imagination fall under s. 2(18) of the IT Act and precisely for this reason cannot be absolved from s. 179 by harping on the flimsy ground of a deemed public company since s. 179 does not preclude such companies, which to all intents and purpose are private companies, retaining their family group ownership of the company." 12. This being the position, the petition under s. 154 in my view has rightly been rejected. Ext. P18 therefore is unassailable. 13. Regarding the second question this is covered by the second limb of s. 179. Sec. 179 provides that every person who was a director of the priv....