TaxTMI 
TaxTMI 
2018 (6) TMI 1466
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....ctions 250 & 144 A, the CIT(A) arrived at a total income of Rs. 62,48,680/-. Meanwhile, on 28.08.1989, the assessee applied under section 245C of the Act before the Additional Bench of the Income Tax Settlement Commission, Chennai. On 29.06.1993 the Settlement Commission passed an order under section 245D (4) of the Act; it was given effect to by the AO through his proceedings, dated 23.08.1993. He redetermined the total income at Rs. 15,52,220/-. 4. As the record reveals, the Settlement Commission issued another order under section 245D on 28.04.1994. The AO gave effect to this order, too. On 22.7.1994, again he revised the total income to be Rs. 17,06,020/-. But, soon thereafter, the AO noticed what is said to be an error and rectified it. 5. The assessee, then, requested the AO to rectify the assessment for 1985-86 by allowing him to set off and to carry forward the loss relating to the firm, M/s. Hotel Shah & Co, for the assessment year 1983-84. Through an order, dt.23.05.1995, the AO rejected the assessee's plea because the loss relating to the assessment year 1983-84 could not be set off: The firm's status was fixed as an unregistered firm (URF), and section 77 (2)(a) o....
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....as incorrect. According to him, the Tribunal misdirected itself by observing that 'the mistake apparent from record must be an obvious and patent mistake but not something which can be established by a long drawn process of reasoning. It negates section 154 of the Act. He has also contended that the Tribunal ought to have examined the issue in the light of Calcutta High Court's decision in Hindustan Lever Ltd v. CIT. (2006) 3 CAL L T 466 (HC) 14. Sri Menon has also submitted that the rectification order has not involved a long-drawn process of reasoning on a point on which there may conceivably be two opinions. On the contrary, the rectification, he contended, resulted from the AO's correcting an arithmetical mistake in charging interest. In other words, Sri Menon asserted that the mistakes noticed by the AO were patent, and they relate to levy of interest under sections 220 (2) and 245D (6A), and also withdrawal of interest under section 244 (1A) of the Act. The Assessee's: 15. Sri Arun Raj, the learned counsel for the assesse, has contended that once the Settlement Commission passes an order under section 245D (1) of the Act, the regular assessment under section 143(3) ....
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....ct share of income from a partnership firm; it resulted in a refund of Rs. 8,90,706/-. 21. But once again the AO found certain mistakes in the revised proceedings. So, on 09.06.2005, he issued notice under section 154 of the Act, to rectify those mistakes: (a) to charge interest under section 220 (2); to levy interest under section 245D (6A); (c) to withdraw interest earlier charged under section 244(1A) of the Act. Later, he did pass an order revising the tax. 22. On appeal, the CIT(A) justified the AO's action. Skipping the later incidental developments, we may straight come to the proceedings before the Income Tax Appellate Tribunal ("Tribunal"). First, the Tribunal dismissed the appeal as not maintainable; later, on remand from this Court, it decided on merits: it allowed the assessee's appeal. Statutory Scheme: 23. The pivotal point that urges our attention and resolution is this: Has the AO been justified in invoking section 154 of the Act? 24. Before amendment by Act 23 of 2012, section 154 empowered an income tax authority "to rectifying any mistake apparent from the record." The authority can correct the mistake either on his own or on being pointed out by the assess....
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....error that strikes one "on mere looking at the record and would not require any long-drawn process of reasoning on points where there may conceivably be two opinions." 29. The Courts have considered on numerous occasions what an error apparent on the face of record is. In Satyanarayan Laxminarayan Hegde v. Malikarjun Bhavanappa Tirumule AIR 1960 SC 137 the Supreme Court has held thus: "An error which has to be established by a long-drawn process of reasoning on points where there may conceivably be two opinions can hardly be said to be an error apparent on the face of the record. Where an alleged error is far from self-evident and if it can be established, it has to be established, by lengthy and complicated arguments, such an error cannot be cured by a writ of certiorari according to the rule governing the powers of the superior Court to issue such a writ." 30. No error can be said to be apparent on the face of the record if it is not manifest or self-evident and requires an examination or argument to establish it. But there might be cases in which it may not work because an error of law might be considered by one Judge as apparent, patent, and self- evident; but might not be ....
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....ry reads thus: (1) Where a refund is due to the assessee in pursuance of an order referred to in section 240 and the Assessing Officer does not grant the refund within a period of three months from the end of the month in which such order is passed, the Central Government shall pay to the assessee simple interest at fifteen per cent per annum on the amount of refund due from the date immediately following the expiry of the period of three months aforesaid to the date on which the refund is granted. (1A) Where the whole or any part of the refund referred to in subsection (1) is due to the assessee, as a result of any amount having been paid by him after the 31st day of March, 1975, in pursuance of any order of assessment or penalty and such amount or any part thereof having been found in appeal or other proceeding under this Act to be in excess of the amount which such assessee is liable to pay as tax or penalty, as the case may be, under this Act, the Central Government shall pay to such assessee simple interest at the rate specified in sub-section (1) on the amount so found to be in excess from the date on which such amount was paid to the date on which the refund is granted ....