TaxTMI 
TaxTMI 
1997 (9) TMI 144
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....3. The present Miscellaneous Application which is the third in the series and was registered as M.A. No. 121/Mum./96 was filed along with an affidavit of Mr. D.M. Harish, Advocate, who had argued the assessee's appeal; on a stamp paper dated 15-7-1996 and executed on 15-7-1996. In the first part of the covering letter dated 15-7-1996 which is reproduced here as under: "In the case of the above applicant, hearing of the Miscellaneous Application No. 63/13/96 was fixed on 12-7-1996. Mr. Y.P. Trivedi, Senior Counsel had appeared on the aforesaid day and had withdrawn the said Application No. 63/13/96 with a liberty to file a fresh M.A. Accordingly, we are filing a fresh M.A. along with the Exhibit 'A', 'B' & 'C'." 4. (i) We have heard the learned assessee's counsel as well as the learned departmental representative. The assessee's counsel has first of au submitted that M.A. filed on 16-7-1996 and registered as M.A. No. 121 /B/96 is a fresh M.A. because the M.A., filed on 8-7-1996, i.e., before the date of hearing of M.A. No. 63/13/96, which was heard on 12-7-1996; was inadvertently mentioned as revised M.A. by the assessee and M.A. No. 63/M/96 was withdrawn with a liberty to fil....
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....ther case laws which were not put for comments either to the assessee or to the department. (ii) Assessee's counsel has further submitted that another mistake has been committed in the Tribunal's order while deciding the assessee's plea based on existence of account of M/s. Lohia Agricultural Farm in the books of Jalan Trading Co. because existence of this account amply proves the genuineness of the credits taken from M/s. LAF. He has further submitted that the Tribunal has filed to consider the facts that the amounts were later on distributed amount the beneficiaries, who were members of Jalan Family, which is another mistake. (iii) Another alleged mistake in the eyes of the assessee's counsel was on account of Tribunal's finding on para 27 of its order where it has been observed that no evidence was filed to show that the applicant had actually, (Cultivated the land because, according to the assessee's counsel, the Assessing Officer as well-is the CIT (Appeals) had accepted the fact of availability of agricultural land with the creditor, M/s. LAF The assessee's counsel further submitted that another mistake which has been crept in para 27 at page 35 of the Tribunal's order ....
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....s 1979-80 36.00 lakhs 1980-81 15.00 lakhs The assessee's stand, before the lower authorities, in support of his claim of genuineness of the aforesaid cash credits was three-fold, viz.: (i) that the creditor M/s. LAF had advanced these loans out of agriculture income earned by the creditor; and (ii) that since the availability of agriculture income in the hands of the creditor f firm (M/s. LAF) had been accepted by the CIT while considering the assessee's disclosure petition for the years 1951-52 to 1971-72, and has allowed the credit to the tune of Rs. 97.75 lacs on account of availability of funds from agricultural income in the hands of M/s. LAF; the revenue now cannot dispute the availability of agriculture income in the hands of M/s. LAF in later years, i.e., during the periods relevant to assessment years 1976-77 to 1980-81. According to the assessee the revenue was barred f from considering the issue relating to availability of agriculture income in the hands of creditor, M/s. LAF during the periods relevant to....
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....p; Date: 8-7-1996 To Dy. Registrar, Income-tax Appellate Tribunal, Mumbai Dear Sir, Re: Miscellaneous application arising out of ITA Nos. 3372 to 3376/B/86 Asst. Yrs. 1976-77 to 1980-81. In the matter of M/s. Ramkumar Jalan v. ITO Cent. Cir. IX, Mumbai. The hearing of the above Miscellaneous Application in the above matter is fixed on 12th July, 1996. We enclose herewith a revised Miscellaneous Application for your kind consideration and withdraw the M.A. No. 63/B/96 submitted earlier. The same may please be taken on record. Thanking you, Yours faithfully, For M/s. Ramkumar Jalan Sd/- Partner." The assessee's plea of claiming the M.A. filed on 16-7-1996 (the present M.A.) to be a fresh M.A. on the plea that in M.A. filed on 8-7-1996, the assessee had inadvertently mentioned the same as 'revised application' and that the M.A. No. 63/Mum./96 was withdrawn with liberty to file a fresh M.A., in our opinion, is not factually correct, because, there is nothing on record which may suggest that M.A. No. 63/Mum./96 was withdrawn with the liberty to fi....
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.... 7 and 8 of the affidavits (statements in both the affidavits are verbatim the same) are factually incorrect wholly or partly as discussed hereunder:- (i) In para-2 of the affidavit, it has been stated that at the time of hearing VI Volumes (Vol. I to Vol. VI) of the Paper Book were filed but the facts on record speaks otherwise because after the close of the hearing of the appeal, the Bench had directed the assessee's counsel to take back Vol. I & Vol. II as well as other documents placed in Vols. III to VI which were not referred to during the hearing and Vols. I and II actually taken back there and then as per acknowledgement available on record. (ii) The Deponents statement in para 3 of the affidavit that Vols. IV and V of the paper books contain the case law relied upon by him on behalf of the assessee is also found to be incorrect because (i) five cases have been duly recorded and considered and (ii) the counsel had referred and relied only on five decisions duly recorded by the Tribunal in para 14 of the Tribunal order and not to any other case law. (iii) The Deponents statement that he had not withdrawn Ground Nos. 6 to 21 is also found to be incorrect because the ....
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.... same cannot be termed as a mistake apparent from the records, which could be rectified by the Tribunal in exercise of its powers vested by virtue of provisions of section 254(2). The correctness of a conclusion on facts or in law cannot be subject matter of a rectification proceeding. If the Tribunal on the facts and in the circumstances has taken a conscious decision, the same cannot be disturbed or upset by either of the parties to the dispute by making an application for rectification. Such an application, in fact, amounts to seeking the review of the Tribunal's order which is neither permissible in law nor the Tribunal is entitled to do so. The Tribunal, being a creature of law, is debarred from reviewing its own decision. It can rectify only a mistake apparent from the records-either on its own motion or on an application by any of the parties. (ii) It is also settled law that the decision of the Tribunal should not be scrutinised sentence by sentence or word by word, merely to find out whether all facts have been set out in detail by the Tribunal or whether some incidental facts which may appear on the records or may have been stated during the course or arguments have no....
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....ame on merits by considering each and every issue raised by the assessee in the M.A. in the ensuing part of this order. 11. (i) The assessee's counsel's first submission was that in para-1 at page 1 of the Tribunal's order (hereinafter referred to as "TO"), the number of grounds is mentioned as "6 to 21", whereas in para No. 18 at page 20 and para No. 26 at page 35, the number of grounds mentioned is as "7 to 21" and has sought clarification because, according to him, the Tribunal having proceeded on the basis of only ground Nos. 1 to 5, the narration in para 18 and para 26 should be "Ground Nos. 6 to 21" instead of "ground Nos. 7 to 21". After going through the TO the assessee's submission is found to be correct and, therefore, the typographical error in para 18 and para 26 to the TO is rectified with the observation that the number of grounds mentioned in para 18 at page 20 and para 26 at page 35 of the TO may be read, instead of "7 to 21"; as "6 to 21". (ii) The next part of the assessee's submission was that its counsel had not withdrawn ground Nos. 6 to 21 at the time of hearing of the appeal and the Tribunal's observation to this effect is a mistake apparent from the re....
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....er. In view of the above facts and circumstances and the Tribunal's observations in paras 16,22 and 25 recorded already in para No. 10(iii), we hold that: (i) the ground Nos. 6 to 21 were not argued/pressed during the course of hearing of the appeal and (ii) even otherwise stand considered and dismissed. (iii) The next issue raised by the assessee's counsel and as per para 3 of the M.A. is that the Tribunal has committed a mistake in not mentioning the name of two other partners of credit or firm, M/s. LAF, viz., Sri Dharmchand Jalan (HUF) and Shri Umashankar Lohia (HUF). After considering the submissions of rival parties, and having gone through the T.O., which states that "all the partners of the assessee firm were partners in capacity of kartas of the respective HUFs in the firm of M/s. LAF in whose name credit appears in the books of account of the assessee", we are of the opinion that there is no mistake in the Tribunal's observation in deciding this issue in these appeals, the Tribunal was not concerned with the constitution of M/s. LAF rather was concerned with the constitution of the assessee-firm, and the control of the assessee's partners over the affairs of M/s. LAF I....
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....me with 'LAF' in the years 1975-76 to 1980-81 relevant to assessment years 1,976-77 to 1981-82 must also be accepted by the Department. After having gone through the so-called note on disclosure in Jalan's cases (Para No. 3.6 and statement 'C' at P. No. 621 to 628 & 634 of the assessee's paper book) reproduced below, as well as contents of page No. 618 of assessee's paper-book, we are of the opinion that there is nothing in these documents which may prove, even remotely, that the creditor LAF had any agricultural income during the periods relevant to assessment years. 1976-77 to 1981-82. Before parting with this aspect, we consider it necessary to reproduce the relevant extracts from the documents relied upon by the assessee's counsel. Extract from note on disclosure in Jalan's cases: (Page Nos. 621, 627-628 & 634) "Exhibit-I" Para No. 3.6 This was the main important issue. The details discussion by the IAC with the assessee could not consult in any agreed figures regarding the three important aspects to be considered in this regard, namely: (a) 200 acres were held by as per allotment in the year 1951 by the Dy. Commissioner as per evidence filed (placed on record) (....
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....; 70,00,000 the farm ---------------- Rs. 97,75,000 ---------------- Extract from document at page No. 6181 No. Central/IK/F.D.I/75-76 Office of the ITO Section IX Central Registration II, Mumbai Camp at: ....
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....bsp; 363.735 ------------ Thus, Shri Uma Shankar was having 363.735 acres of land in the Majhaon village. This is also clear from the certified copy filed by you in para 'a' and 'c'. In para 'b' of your letter, you state that you have filed a certified copy of Khatauni in respect of 418.020 and 367.240 acres of land in village Majhaon. It is seen that you have not properly read the certified copy obtained by you. This certified copy submitted by you does not show any land in the name of Shri U.S. Lohia. This certified copy is simply a total acreage of land of class I to class IV as per the Khatauni register of Majhaon village, 367.240 acres of land mentioned by you in para 'b' of your letter is also not of Uma Shankar of land which is already included in the total of 418.020 acres. It is, therefore, your claim of para 'b' in respect of 418.020 and 367.240 acres of land in village Majhaon is absolutely incorrect. In para 'd', 'e', 'f' & 'g' the certified co....
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.... to 1981-81. in spite of the fact that there was nothing in the so called disclosure petition which could support the assessee's plea, the ITO laboured hard and held a camp Office at Behraich. As there was no co-operation from the assessee's side, so the ITO himself collected the material which has been narrated at page. 11 of his order in the following form: "I visited Baharich personally as planned and intimated to the assessee. Nobody attended from assessee's side and it was clear that the assessee was not interested in giving any evidence whatsoever. It was noticed that Revenue authorities have taken up consolidation proceedings in villages, Majhao & Gangapur during 1975-80 and had maintained consolidation Khasra in the Form CH 2A. These records shows various details including ownership and possession in respect of every plot of land in these villages. The assessee had completely failed to provide me any evidence relating to the possession of agricultural land belonging to other by LAF. On the other hand, it was noticed that there was certain acres of land in villages, Majhao and Gangapur only in the names of the Shankar Lohia, Shyamsunder Lohia, Jagnnath Lohia & others. Mor....
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....der the case laws listed in Annexure B to the Affidavit of Mr. D.M. Harish, Advocate, and (b) that the Tribunal has committed a mistake in relying on certain other case laws, which were not put for comments to the assessee or the Department. The learned Department Representative on the other hand, has submitted that the statements in Annexure B enclosed with the affidavit of Shri D.M. Harish, is factually incorrect because out of 18 cases listed in it, the case laws at Sr. No. 2, 5, 6 and 10 have been duly taken note of by the Tribunal in para No. 14 and the other cases were not cited at all. The learned D.R. after referring erring to paras 16, 24, 25 and 26 further pleaded that even otherwise the order having been passed by the Tribunal by observing that it has gone through the records available before it, the rest of the case laws also stands considered. (a) After considering the rival submissions and having gone through the records available before us, first of all we would like to observe that the assessee's claim is factually incorrect because the cases at Sr. Nos. 2, 5, 6 and 10 of Annexure B attached with the affidavit have been duly noted in para 14 of the T.O. and there....
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....ered opportunity to show any kind of evidence relating to cash credits under appeal, we hold that no evidence of any kind, which the assessee was under obligation to produce for proving the genuineness of the cash credits under appeal was ever filed, and therefore, the ClT (Appeals) as well as the ITO were justified in considering the amount of cash credits as assessee's income from undisclosed sources in the relevant assessment years. (b) As regards the assessee's grievance that the Tribunal has taken cognizance of case laws not cited before it at the time of hearing, we, after considering the rival submissions, are of the view that what the assessee's counsel seems to suggest is that the Members of the Tribunal were supposed to know only that much of law or facts or the application of law to the facts of a case as was told to them either by the members of the Bar or by the Departmental representative. It appeared to be the substance of the arguments and pleadings on behalf of the assessee that even if the members of the Tribunal knew some law they should first get the correctness of their understanding approved by the members of the Bar and unless they did so, their order on t....
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....the provisions of section 254(2) of the Act. According to the assessee's counsel the Tribunal has not considered the fact that there was opening balance as on opening date of assessment year 1976-77 of Rs. 337 crores in the account of the creditor and that an amount of Rs. 3,47,20,000 was disbursed during the period relevant to the assessment year 1977-78 amount the family members of Jalan Family and on account of non-consideration of these facts by the Tribunal, the Tribunal has failed to ascertain that these amounts were not belonging to the firm, M/s. Ramkumar Jalan. We have considered the facts and circumstances of the case and arguments advanced by the assessee's counsel. A bare reading of the part of the Tribunal's order where this piece of evidence has been considered. (Para 19) will show that this piece of evidence, which was claimed by the assessee as sufficient evidence for proving the genuineness of the credits appealing in the assessee's books of account in the name of creditor M/s. LAF; was rejected by the Tribunal not because of its authentication by way of signature on it, rather was rejected because of the fact that assessee had not prove the genuineness of the t....
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....isclosure upto the year 1971-72, have been duly taken note of in paras 13, and 14 of the T.O. and the issue has been discussed and decided in para 20 of the T.O. and, therefore, there is no mistake as such. (b) As regards to the assessee's claim that the CIT (Appeals) had accepted the existence of land in the creditors' hands, we have, after going through the order of the CIT (Appeals) as well as ITO's letter dated 18-1-1984 have found that none of them has any where accepted the existence of agricultural land with the creditor or in the hands of Shri Uma Shankar Lohia during the periods relevant to assessment years 1976-77 to 1980-81. On the contrary the Assessing Officer has categorically observed in the last para of his letter dated 18-1-1984 reproduced at pages 12 and 13 of the T.O. that "the consolidation proceedings leave no doubt that practically the entire land was in the adverse possession". This conclusion was based on authenticated revenue record in Form No. CH2A, a copy of which was supplied to the assessee and the fact that the land belonging to Uma Shanker Lohia had been sold out. (c) If the conclusion arrived at by the Assessing Officer, which was duly communic....