TaxTMI 
TaxTMI 
2000 (8) TMI 1
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....side the assessment orders, restored the matters to the file of the Assessing Officer, directing him to pass a fresh order after allowing the assessee the opportunity to support the documents that it had earlier filed before him. Neither party sought to file any reference application there against but the assessee filed an application before the Tribunal under section 254(2) of the Income-tax Act, 1961, Seeking to rectify it on the basis that a contention that it had raised had not been decided. On January 4, 1995, the Tribunal allowed the rectification application. It noted that the assessee's objection was that the assessment on account of the credits should be made in the hands of the partners of the assessee as they had made payments by....
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....an earlier decision of the High Court, in the case of Popular Engineering Co. v. CIT [1983] 140 ITR 398 (MP), in which it had been held that a reference against an order of rectification under section 254(2) was not maintainable. In the earlier judgment, the High Court said : "The language used in section 256(1) shows that the order contemplated under section 256(1) is the order passed under section 254 of the Act. Under section 254(1) the Appellate Tribunal passes an order on the appeal filed by the assessee or the Revenue. This order may be amended under section 254(2) of the Act with a view to rectifying any mistake apparent from the record. If, however, the application for rectification is dismissed, there is no amendment of the orde....
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....plication, draw up a statement of the case and refer it to the High Court : Provided that the Appellate Tribunal may, if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the period hereinbefore specified, allow it to be presented within a further period not exceeding thirty days. (2) If, on an application made under sub-section (1), the Appellate Tribunal refuses to state the case on the ground that no question of law arises, the assessee or the Commissioner, as the case may be, may, within six months from the date on which he is served with notice of such refusal, apply to the High Court, and the High Court may, if it is not satisfied with the correctness of the decision of the A....
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.... after the 1st day of October, 1998, shall be accompanied by a fee of fifty rupees." Section 256 empowers the assessee and the Revenue to "require the Appellate Tribunal to refer to the High Court any question of law arising out of" an order passed under section 254. Section 254(1) states that the Appellate Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. It would appear that the High Court read section 254(1) as referring only to orders passed by the Tribunal on an appeal. We do not think that that would be a correct way of reading section 254(1). Section 254(1) empowers the Tribunal to pass orders not only on an appeal before it but also upon such applicat....