The Commissioner Of Income Tax vs Cl Rae
2010 Latest Caselaw 2357 Del

             THE HIGH COURT OF DELHI AT NEW DELHI

%                                   Judgment delivered on: 04.05.2010

+            ITA 523/2010


THE COMMISSIONER OF INCOME TAX                            ... Appellant


                                    - versus -


CL RAE                                                  ... Respondent

Advocates who appeared in this case:

For the Appellant       : Ms Rashmi Chopra
For the Respondent      : None

CORAM:-
HON'BLE MR JUSTICE BADAR DURREZ AHMED
HON'BLE MR JUSTICE V.K. JAIN

1. Whether Reporters of local papers may be allowed to see the judgment ? No

2. To be referred to the Reporter or not ? No

3. Whether the judgment should be reported in Digest ? No

V.K. JAIN, J (ORAL)

1. This is an appeal against the order of the Income Tax Appellate

Tribunal, dated 05.06.2009, whereby the miscellaneous application being

M.A No. 240/Del./05, filed by the Revenue, seeking rectification of the

order of the Tribunal dated 03/08/2001, in ITA No. 1652/Del/1995, was

dismissed.

2. The respondent/assessee was an employee of G.E.C. Turbine

Generators India Ltd. (GECATGL) working as Assistant in Mechanical

Commissioning at its Rihand site. For the assessment year- 1990-91, the

assessee filed the return, declaring income of about Rs. 15,90,942/-. During

assessment proceedings, the Assessing Officer noticed that a search under

Section 132 of Income Tax Act, hereinafter refer to as "the Act" had been

conducted at the business premises of the company in which the assessee

was employed. He found that the evidence seized during the search

established that the salary paid to the assessee had not been fully and truly

disclosed by the employer company. Based upon the material sized during

search, the settlement application filed by the employer company and the

order of CIT (A) in respect of earlier orders, the Assessing Officer made

certain additions to the salary disclosed by the assessee. The additions

comprised Rs 76,738/- on account of overtime, Rs 3, 36,809/- on account of

overheads being 45% of the salary and Rs. 28,704/- on account of

perquisites. He also made addition of Rs. 13,55,167/- on account of tax

perquisites.

3. In the appeal filed by the assessee, the CIT(A), relying upon the

decision of his predecessor in case of 9 other employees of the same

company whose cases were identical to the case of the assessee and also

relying upon the order of the Tribunal in the case of 21 employees of the

same company, having identical facts, deleted the additions made by the

Assessing Officer.

4. Being aggrieved from the order of the CIT(A), the Revenue filed

an appeal before the ITAT. The appeal was dismissed vide order dated 03 rd

August, 2001 on the ground that the CIT(A) had followed the order of his

predecessor in the case of other identically placed assesses, which had also

been upheld by the Tribunal.

5. The Revenue preferred ITA No.177/2002 before this Court

against the order of the Tribunal dated 03rd August, 2001, challenging

deletion of the additions on account of overtime, overheads and perquisites,

as also the deletion of tax perquisites, claiming that the order of the Tribunal

was perverse and was a non-speaking order. It was contended before this

Court that the facts of the cases, relied upon by the Tribunal, were

distinguishable. It was, however, admitted before this Court that no such

plea had been raised by the Revenue before the Tribunal. The appeal filed

by the Revenue was, therefore, dismissed vide order dated December 15,

2003 holding that the view of the Tribunal on a similar issue having been

accepted by the Revenue in respect of the one of the issues, no question of

law survived for the consideration of this Court

6. M.A.No. 240/Del/05 was, thereafter, filed by the Revenue stating

therein that the assessee himself had disclosed tax perquisite, amounting to

Rs 8,36,319/- in the return filed by him and even that amount was deleted by

the CIT(A), thereby giving excessive relief to the assessee. The Revenue,

accordingly, sought rectification of the mistake alleged to have been

committed by the Tribunal, while passing the order dated 03rd August, 2001.

7. While dismissing the application filed by the Revenue, the ITAT

noted that during the course of hearing before it, the Departmental

Representative had conceded the fact that while allowing the appeal filed by

the assessee, the CIT(A) had followed the order of his predecessor in case of

identically placed assessees. The Tribunal was of the view that the

Departmental Representative having conceded that the issue was covered by

the order passed in favour of identically placed assessees and the Reference

Applications against its order having been rejected, there was no ground for

reviewing the order passed by it on 03rd August, 2001.

8. Section 254(2) of the Act, to the extent, it is relevant empowers

the Appellate Tribunal to amend an order passed by it, with a view to rectify

any mistake apparent from the record. In order to attract the application of

Section 254(2), the mistake must not only exist, it needs to be apparent from

the record which would mean that the mistake, attributed by the applicant in

the order, must be visible and obvious. It needs to be an error which is patent

and discovery of which does not require argument or elaboration.

9. In the present case, the Tribunal did not find any apparent error in

the order passed by it on 03rd August, 2001. Departmental representative

having conceded before the Tribunal that the case of the assessee was

identical to that of other employees whose case was followed by the CIT(A)

for allowing the appeal filed by the assessee, there was no necessity for the

Tribunal to examine the facts of the case of the assessee and compare them

with the facts of other employees whose case was relied upon by the

CIT(A). It was not the case of the Revenue before the Tribunal that no

concession, as recorded in the order dated 03rd August, 2001, was actually

made by the Departmental Representative. The Departmental

Representative having conceded that the facts of the case of the assessee

were identical to the facts of other assessees and the Tribunal having

proceeded on that basis, we find no error apparent in the impugned order

passed by the Tribunal on 3rd August, 2001.

10. While considering the application of the Revenue under Section

254(2) of the Act, the Tribunal could not have gone into those facts which

had already been conceded before it by the Departmental Representative. If

the facts of the case of this assessee were different from the facts of the cases

of other employees of this company, as is now sought to be contended by the

Revenue, the alleged difference in the facts ought to have been brought to

the notice of the CIT(A) and in any case to the notice of the Tribunal before

it decided the appeal filed by the Revenue. However, not only did the

Revenue fail to bring any distinguishing feature to the notice of the Tribunal,

its representative virtually conceded that the case of the assessee was

identical to the case of the employees relied upon by the CIT(A). In fact,

during the course of hearing of ITA No.177/2002, it was fairly conceded by

the learned counsel for the Revenue that the plea of difference in facts was

not raised by the Revenue before the Tribunal. In these circumstances, it is

difficult for us to say that the Tribunal was not correct in holding that there

was no error apparent from the record, in the order passed by it on 03rd

August, 2001. In any case, no substantial question of law arises for our

consideration in this case.

The appeal is hereby dismissed.

(V.K. JAIN) JUDGE

(BADAR DURREZ AHMED, J) JUDGE MAY 03, 2010/ss/bg