Law:

Section:

Section 254 of the Income-tax Act, 1961 - Appellate Tribunal - Powers of - Assessment year 1964-65 - Whether jurisdiction of Tribunal on an application under section 254(2) is to make an amendment of an order passed by it under sub-section (1) in order to rectify any mistake apparent from record if such mistake is brought to its notice - Held, yes - Whether, however, on aforesaid application, Tribunal has got no power to review an earlier order or rehear a matter afresh - Held, yes FACTS The petitioner company carried on business in iron and structural steel materials and also business of contract. During accounting year relevant to assessment year 1964-65, the petitioner suffered certain loss which was written off as bad debt against the income from business in iron goods and the contract business. The ITO found that said loss related to the contract business which was closed down two years back and that actually no contract work was done during the year. Accordingly, that sum was added back. On second appeal the Tribunal dismissed the appeal. Thereafter an application under section 254 was made by petitioner/assessee on the ground that the observation by the Tribunal in its order "that no material had been brought by the assessee on record to show that the contract business and the business in hardware and structural steel were one and the same business and that it was also on record that the contract business was not done from 1963-64 assessment years onwards" was not correct. The Tribunal dismissed said application. On Writ: HELD The jurisdiction of the Tribunal on an application under section 254(2) is to make an amendment of an order passed by it under sub-section (1) in order to rectify any mistake apparent from the record if such mistake is brought to its notice. In this particular case, the contention of the petitioner was that there was a mistake in the order because it did not correctly record the facts as mentioned above. In view of the same an application had been made and reliance had been placed on a supporting affidavit. It was for the Tribunal to consider such application and decide whether there was any such mistake within the meaning of the…

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