Punjab & Haryana H.C : Whether, on the facts and in the circumstances of the case, the learned Tribunal is right in law in reversing the order of the learned Dy. CIT(A) who upheld the order of the AO passed under s. 154 holding that no mistake was apparent from records in so far as charging of interest under s. 139(8) was concerned, for the asst. yr. 1975-76 ?

High Court Of Punjab & Haryana

CIT vs. K.D. Prabhakar (HUF)

Section 256(2)

Asst. Year 1975-76

G.S. Singhvi & Nirmal Singh, JJ.

ITC No. 46 of 1998

14th November, 2000

Counsel Appeared

R.P. Sawhney with Rajesh Bindal, for the Revenue : Sanjay Goyal, for the Assessee

JUDGMENT

G.S. SINGHVI, J. :

This is a petition under s. 256(2) of the Income-tax Act, 1961, (for short “the 1961 Act”), for directing the Income- tax Appellate Tribunal, Amritsar Bench, Amritsar (for short, “the Tribunal”) to refer the following question of law to this Court for its opinion : “Whether, on the facts and in the circumstances of the case, the learned Tribunal is right in law in reversing the order of the learned Dy. CIT(A) who upheld the order of the AO passed under s. 154 holding that no mistake was apparent from records in so far as charging of interest under s. 139(8) was concerned, for the asst. yr. 1975-76 ?”

2. The facts necessary for deciding this petition are that after the AO had completed the assessment of the respondent’s income for the year 1974-75, it came to his notice that the respondent-assessee had received additional compensation and interest in pursuance of the judgment dt. 12th July, 1988, of the High Court in lieu of compulsory acquisition of his land, but the latter had not filed a return for assessment of the capital gain made in the form of interest. Therefore, he issued notice under s. 148 of the 1961 Act for initiation of the proceedings under s. 147 of the 1961 Act. On receipt of the notice, the assessee furnished a return declaring income at Rs. 36,900 plus agricultural income of Rs. 400 for the relevant assessment year. Thereafter, the AO passed an order dt. 19th Aug., 1993, under s. 143(3) of the 1961 Act, assessing the total taxable income of the respondent at Rs. 36,900 plus agricultural income of Rs. 400. He also levied interest under s. 139(8) of the Act. The respondent did not challenge that order by filing an appeal within the period of limitation, but after about two years, he filed an application dt. 28th July, 1995, under s. 154 of the 1961 Act for correction of the so-called error of charging interest under s. 139(8) of the 1961 Act by contending that in the cases of the co-owners, namely, Amrit Lal Prabhakar and Raghunandan Lal Prabhakar, the CIT(A) had held that the interest was not chargeable under s. 139(8) of the 1961 Act. The AO rejected that application on the ground that the order dt. 19th Aug., 1993, did not suffer from any mistake apparent on the face of the record. The Dy. CIT(A), Jalandhar dismissed the appeal filed by the respondent, but the Tribunal allowed the second appeal and held that no interest was chargeable under s. 139(8) of the 1961 Act.

Shri R.P. Sawhney, senior counsel for the Revenue, invited our attention to the order passed by the Tribunal on the application for reference filed by the respondent under s. 256(1) of the 1961 Act and submitted that ITC No. 113 of 1996—CIT vs. Satya Swami, on which reliance has been placed by the Tribunal for declining the Revenue’s request for reference, has no bearing on the question sought in this case and, therefore, this Court should direct the Tribunal to refer the aforementioned question to this court before us a copy of the paper book of ITC No. 113 of 1996, to substantiate his assertion. Learned counsel argued that the Tribunal has gravely erred in holding that the application filed by the respondent under s. 154 of the 1961 Act, was maintainable, because the order passed by the AO for levy of interest under s. 139(8) of the 1961 Act did not suffer from any mistake apparent on the face of the record. He then argued that the order passed by the CIT(A) in the cases of co-owners could not have been relied upon for entertaining the application filed under s. 154 of the 1961 Act, more so, because no such plea was raised before the AO.

Learned counsel for the respondent relied on the judgments of this Court in Maya Ram Jia Lal vs. CIT (1984) 43 CTR (P&H) 138 : (1985) 152 ITR 608 (P&H) : TC 49R.809 and CIT vs. Rajesh Talkies (1996) 133 CTR (P&H) 474 : (1996) 220 ITR 107 (P&H) : TC 53R.409 and argued that the question sought by the Revenue cannot be treated as a question of law requiring adjudication by this Court.

5. We have considered the respective arguments. In the case of Rajesh Talkies’s case (1996) 220 ITR 107 (P&H) (supra), a Division Bench has held that the decision rendered by the appellate authority in one case cannot be made the basis for declaring that the order passed by the competent authority suffers from a mistake apparent on the face of the record. In view of that position and also the fact that the order passed in ITC No. 113 of 1996—CIT vs. Satya Swami, on which reliance has been placed by the Tribunal for rejecting the petition filed under s. 256(1) of the 1961 Act, does not have any bearing on the question sought by the Revenue, we are convinced that the question framed by the Revenue calls for determination by this Court. Hence, the petition is allowed. The Tribunal is directed to refer the abovenoted question to this Court and second the statement of the case at an early date for appropriate adjudication by the Court.

[Citation : 249 ITR 299]

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