Law: Income Tax Act, 1961

Section: 254(1),254(2)

[Indian Income Tax Act 1961].......Section 254(1), (2) - Appeal to Appellate Tribunal - Rectification of mistake - Powers of Tribunal to rectify mistakes in its order - Scope of power - Reference to High Court - Tribunal dismissed the appeal of the assessee - Assessee Held miscellaneous application before the Tribunal to recall its earlier order - Whether a reference could be made from an order passed by the Tribunal on a miscellaneous application deciding to recall its previous order - Held no - Any mistake apparent from the record, whether pointed out by the assessee in the application - Held no - Whether the Tribunal exceeded its jurisdiction in passing the order recalling its previous order for rehearing - Held yes . On a closer reading of sections 254 and 256 of the Income-tax Act, we are of the opinion that a reference lies from orders under section 254(1) or illegal orders made under section 254(2) of the Act. In the latter case, the order which may be subject to a reference under section 256(1) will only be an order passed by the Tribunal amending its earlier order rectifying the mistake brought to its notice by the assessee or the Assessing Officer Finality is attached only to orders disposing of the appeal under section 254(1) or orders amending such appellate orders in exercise of the power of rectification under section 254(2) of the Act. We are of the opinion that an order on a miscellaneous application in the nature of the impugned order, though passed under section 254(2) deciding to recall its previous order and to post the matter afresh for hearing, is not an order from which a reference can be made under section 256 of the Act. In this view, the preliminary objection which counsel for the respondent has raised can only be dismissed. We are, therefore, of the opinion that, unless there is a mistake apparent from the record in the sense of patent, obvious and clear error or mistake, the Tribunal cannot recall its previous order, lf the error or mistake is one which could be established only by long drawn arguments or by a process of Investigation and search, it is not a mistake apparent from the record. If two views are possible on a point of…

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