Law:

Section:

Section 154 of the Income-tax Act, 1961 - Rectification of mistakes - Apparent from records - Assessment year 1978-79 - During relevant assessment year, a sum was paid to assessee by department on account of interest under section 244(1A) - However, while filing return for said year, that income was not included in computation but assessee wrote a footnote requesting Assessing Officer to consider payment of interest which escaped notice of Assessing Officer when he framed original assessment - Later on, Assessing Officer rectified assessment under section 154 and added interest received by assessee to its total income amid protest of assessee that issue was debatable one - Whether it was a clear case of a mistake apparent from records which could be rectified under section 154 and there was no question of that issue being termed as debatable one - Held, yes - Whether, therefore, Tribunal was justified in upholding rectification proceedings under section 154 - Held, yes Akshay Bhan for the Petitioner. Dr. N.L. Sharda for the Respondent. JUDGMENT N.K. Sud, J. - At the instance of the assessee, the Income-tax Appellate Tribunal, Amritsar Bench, Amritsar (for short "the Tribunal") has referred the following questions of law arising out of its order dated 18-3-1994 for assessment year 1978-79, for the opinion of this Court :- "1. Whether the Income-tax Appellate Tribunal was correct in law in upholding the actions of the ITO in initiating proceedings under section 154 and holding that there was a mistake apparent on record which could be rectified under section 154 of the Income-tax Act ? 2. Whether in view of the fact that the amount received by the assessee company by way of interest for the assessment years 1979-80 and 1980-81 was not taxed could it not be said that the ITO who initiated proceedings under section 154 was of the opinion that the amount of interest is not taxable and could not be regarded to as the income of the assessee company for the instant assessment year ?" 2. To resolve this dispute, brief facts of the case may first be noticed. During the assessment year 1978-79, a sum of Rs. 58,069 had been paid to the assessee by the Income-tax Department…

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