The Seksaria Biswan Sugar Factory Ltd , ... vs Assessee
- CitationITA No. : 4040/Mum/2010,
Ratio decidendi
The rule this decision rests on
The Tribunal holds that where an order giving effect to an appellate or tribunal order is itself rectified under section 154, the surviving order for purposes of revision under section 263 is the original order that gave effect to the appellate decision, and the revisional power under section 263 cannot be exercised against an issue that was concluded by an earlier order; a revision directed at a rectification order in respect of a matter already concluded by that earlier order is not permissible. Where the commissioner's power of revision under section 263 must be exercised within the prescribed time limit, a revision of an order that became final and was not in issue before the appellate authority is barred by limitation if initiated more than two years after the date of the order sought to be revised, the relevant order being the original order and not the subsequent rectification order.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
आयकर अपीलीय अिधकरण "जी " यायपीठ मुब ं ई म । IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH "G", MUMBAI ी बी. बी. आर आर.. बा कर बा करन न , लेखा सद य एवं ी िववेक वमा#, याियक सद य के सम% । BEFORE SHRI B R BASKARAN, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBER आयकर अपील सं. : 4040/4040/मुम/2010, िनधा रणवष 2000-01 ITA No. : 4040/Mum/2010, (Assessment year 2000-01) The Seksaria Biswan Sugar Factory Ltd. Vs Commissioner of Income Tax -2, Seksaria Chambers, 5th Floor, Room No. 344, 3rd Floor, 139, Nagindas Master Road, Aayakar Bhavan, Fort, Mumbai - 400 001 M K Road, PAN: AAACT 1343 C Mumbai - 400 020 अपीलाथ (Appellant) ू यथ (Respondent) Appellant by : Shri Y P Trivedi Shri Rupal Vora Respondent by : Shri Pavan Kumar Beerla
सुनवाईक तारीख /Date of Hearing : 12-02-2015 घोषणाक तारीख/Date of Pronouncement : 04-03-2015
आदे श ORDER ी िववेक वमा , या. या. स. PER VIVEK VARMA, J.M.:
The appeal is field by the assessee against the orders of CIT 2, Mumbai, dated 23.03.2010 u/s 263 of the Income Tax Act.
2. The facts are that on the issue of additional quota, the case of the assessee reached the ITAT. In ITA No. 7692/Mum/2003, the coordinate Bench of the ITAT, relying on the decisions on the issue for assessment year 1991-92, 1992-93, 1993-94, 1995-96, 1996-97, 1997-98 and 1998-99 held the receipts from sale of additional quota was capital receipt and therefore, not exigible to tax.
2 The Seksaria Biswan Sugar Factory Ltd ITA 4040/Mum/2010
3. In the appeal giving effect order dated 26.11.2007, the AO once again added back Rs. 4,42,65,747/-, which the ITAT had held to be not taxable.
4. The assessee filed an application u/s 154 for rectification of mistake, as the AO had not given direct and proper effect to the directions of the ITAT.
5. The AO vide order dated 07.02.2008 passed the rectification order, finally, giving effect to the order of the ITAT.
6. Against this order rectification u/s 154 dated 07.02.2008, the CIT has initiated revision proceedings u/s 263, because according to him the AO failed to compute income u/s 115JA.
7. The AR, before us submitted that if at all there was any mistake in the order of the AO, it was in the original regular assessment framed u/s 143(3). But this is a case of order giving effect to the order of the ITAT. Since there was an apparent mistake in this order, of order giving effect, the assessee sought rectification, which was rectified.
8. In any case, the AR submitted that the initiation of proceedings u/s 263 is well beyond the two years limitation period.
9. According to the AR, the order was order giving effect to the ITAT order dated 26.11.2007. Rectification proceeding was only to rectify the mistake, which was on the face of the order, and which legally, got merged with the main order, which in the instant case was dated 26.11.2007.
10. In such a circumstances, if at all the CIT had proposed to revise the order, it could have been the order dated 26.11.2007.
3 The Seksaria Biswan Sugar Factory Ltd ITA 4040/Mum/2010
11. The AR, therefore, submitted that on the both the circumstances, the revision proceedings were illegal.
12. The DR supported the order of the CIT.
13. We have heard the rival contentions and have pursued the various orders. If at all there was an infirmity, it was in the order giving effect to the order of the CIT(A) dated 06.11.2003. The issue of 115JA became final as it was never raised by either party, post the order dated 06.11.2003, as referred above. In any case on other issues the case travelled to the ITAT and was decided by it.
14. At this stage, the assessment was framed on the issues which were entrusted to the AO to give effect to.
15. The issue of 115JA was neither the issue before the ITAT nor in the appeal effect, as it was already final.
16. In such a case, we cannot hold that the order of the CIT u/s 263 is correct, because the CIT has the power to revise any order, within a prescribed time limit. In the current proceedings, the order dated 06.11.2003 could only be reversed by CIT u/s 263 on or before 31.03.2006. If what the CIT was seeking to revise, i.e. order u/s 154, is allowed, then it will give un bridled and unstoppable power to the CIT.
17. Reverting our attention, as to which order could have been revised by the CIT. We find that the CIT sought to revise the order u/s 154 dated 02.01.2008 in respect of a matter which got concluded on 06.11.2003. This cannot be allowed because the surviving order was order u/s 143(3) read with section 154, dated 06.11.2003.
4 The Seksaria Biswan Sugar Factory Ltd ITA 4040/Mum/2010
18. We, therefore, cancel the initiation of proceedings u/s 263 and the consequential order dated 23.3.2010 and restore the order u/s 154 dated 07.02.2008.
19. On the issue of limitation as well, we find that the order sought to be revised in rectification order dated 07.02.2008, whereas if at all any order could be revised was order u/s 143(3)/254 dated 26.11.2007. Since the order u/s 263 is dated 23.03.2010, it is well beyond the two years limitation period from order dated 06.11.2003.
20. Under these circumstances, we cancel the order u/s 263 as illegal, being beyond the limitation.
21. In the result, the appeal as filed by the assessee is allowed.
Order pronounced in the open Court on 04/03/2015.
Sd/- Sd/- (बी. बी. आर. आर. बा करन बा करन) (िववेक वमा ) लेखा सद य याियक सद य (B R BASKARAN) (VIVEK VARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER
Mumbai, Date 04/03/2015
ूित/Copy to:-
1) अपीलाथ /The Appellant. 2) ू यथ /The Respondent. 3) The CIT -2, Mumbai.
#वभागीयूितिनिध "जी" आयकरअपीलीयअिधकरण,मुंबई
4) The Addl CIT-Rg. 2(3)/CIT- Concerned ____, Mumbai.
5) The D.R. "G" Bench, Mumbai.
6) गाड फाईल 5 The Seksaria Biswan Sugar Factory Ltd ITA 4040/Mum/2010
Copy to Guard File.
आदे शानुसार/By Order / / True Copy / /
उप/सहायकपंजीकार आयकरअपीलीयअिधकरण,मुंबई Dy./Asstt. Registrar I.T.A.T., Mumbai *च/हानव.िन.स *Chavan, Sr. PS
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