Tribunal can’t Review its own decisions u/s 254(2) unless there is a Mistake apparent from Records: ITAT [Read Order]

Mumbai bench of the ITAT in the case of Sh. Bimal V. Pala v. Principal CIT has held that the Appellate Tribunal cannot review its own decisions within limited scope of Section 254(2) of the Income Tax Act unless there is a mistake apparent from records.

The Assessee had filed instant Miscellaneous Application seeking recall of the Appellate Tribunal, Mumbai order for the assessment year 1996-97.

The AO received information from the investigation wing that the Assessee has a bank account during the relevant year with HSBC Bank at Geneva, Switzerland. While confronting the same information AO invoke provision of section 147/148.

Assessee filed a nil return by claiming that she was a non-resident during that time and also failed to produce passport before AO since the same was lost. She also claimed that she also lost the all bank statements and transaction during the non-resident period and she did not had any income which could brought into tax for the relevant period.

Thereafter, AO accepted the contention and the assessment were framed at Nil Income. Eventually principal CIT while invoking Section 263 of the Income Tax Act held that AO was failed to prove with respect to her stay in India and without any cogent material and verifications.

The assessee has now filed this Miscellaneous Appeal to rectify mistakes apparent from records u/s 254(2) of the 1961 Act by recalling the orders passed by Division Bench of the tribunal on 17-03-2017 and for fresh hearing of the appeal.

Assessee calimed that assessee declared herself to be Non-Resident in the application form filed by the assessee with UTI for allotment of US 64 securities in July 1995 and the same was sufficient to prove that she is non-resident during that period.

The Tribunal bench including Judicial Member Joginder Singh and Accountant Member Ramit Kochar, perused the assessment order passed by AO which clearly reveals that no enquiry was conducted by the AO and contentions of the assessee were accepted by the AO without any application of mind.

The Tribunal observed that “It is only the discussion by the tribunal on the scope of taxability of the income of Non-Residents which was covered by provisions of Section 5(2) and in any case all Non-Residents are covered by said provision which is already placed in statute by legislature which in our considered view did not made tribunal order amenable to corrections within limited mandate u/s 254(2) as in our considered view no prejudice is caused to the assessee with the said discussion on the relevant and applicable provision of the 1961 Act, thus in our considered view, there is no mistake apparent from records in the said order of the tribunal which can be corrected within limited mandate of Section 254(2).

To Read the full text of the Order CLICK HERE