In Income-tax Appellate Tribunal - Bench Mumbai Before Sh.Shri Rajendra, Accountant Member and Sanjay Garg,Judicial Member (M.A. No.97/Mum/2016-Arising out of ITA No.6337/Mum/2011-Assessment Year 2002-03) M/s. Ashish Gandhi Builders & Income tax Officer Developers, B-11/188, Matru Ashish Vs. Ward-10(2)(3) Rajawadi CHS, Ghatkopar East Room No.431, Aayakar Mumbai-400 077. Bhavan, M.K. Road, PAN: AACCA 3552 Mumbai-400 020. (Applicant) ( Respondent) Appellant by :Shri D.C. Sejpal Respondent by :Shri. Airiju Jaikaran Date of Hearing :16.09.2016 Date of Pronouncement :28.09.2016 ,1961 254(1) Order u/s.254(1)of Income-tax Act,1961(Act) PER RAJENDRA, A.M. Vide its Miscellaneous application,dated 02.05.2016,the assessee-company has stated that certain mistakes were apparent in order of Tribunal,dated 14.09.2015,that same need to be rectified as per provisions of section 254(2)of Act. 2.In its application assessee has submitted that it had not filed any inaccurate particulars of income neither concealed its income, that it had duly disclosed all material facts with regard to filing of income,that audited financial statements disclosed figure of WIP along with return of income filed, that income in question had already been offered to tax in assessment year 2007-08,that only dispute in quantum appeal was with respect to year in which income should be taxed that even though it had offered its income for taxation by following consistent method of accounting (PCM) AO by following different approach had determined income as taxable i.e., AO had re- calculated income by using different method of accounting (WIP) and had taxed income in year under appeal,that judgment of Hon'ble Gujarat High Court in case of Manilal Tarachand (120 taxmann 678) relied upon by assessee had not been taken into consideration by Tribunal while deciding appeal,that notice u/s. 274 r.w.s. 271(1)(c ) sent by AO was very vague and had no clarity whether penalty levied was for filing of inaccurate particulars of income or concealment of income. MA-97/M/16-Ashish Gandhi Builders & Developers 3.During course of hearing before us Authorised Representative (AR) reiterated contentions raised in Miscellaneous Application.He argued that assessee had not concealed particulars of income, that AO had not mentioned as to whether assessee had concealed particulars or had furnished inaccurate particulars.On query by Bench, he admitted that said issue was not raised before AO/FAA/Tribunal. Departmental Representative (DR) stated that there was no mistake in order of Tribunal,that assessee wants review of order decided against it in garb of Miscellaneous Application. 4.We have heard rival submissions and perused material before us. Before proceeding further we would like to reproduce operative part of order of Tribunal. 5.We have heard rival submissions and perused material. We find that assessee had filed death certificate of accountant and we hold that there was reasonable cause for not filing appeal in time.We find that FAA had dismissed appeal not only because it was filed lat,but he had deliberated upon issue on merits also.Therefore,in our opinion,the issue of delay in filing return is academic in nature. Coming to merits of penalty orders,it is found that AO had re-calculated WIP and had taxed it in year under appeal,that FAA had partly allowed appeal in quantum proceedings, that assessee had not disputed that ac and CC were issued by municipal authorities with regard to projects completed by it,that it was aware that tenants had occupied flats.In spite of these facts,it was claiming that work was going on, i.e.the projects were incomplete and that income was not taxable in that year.Each accounting year is different unit and income arising, accruing or received in particular year has to be offered for taxation in that particular year unless and unless there exits some reasonable cause for deferring same to other year/(s).In case before us.the assessee has not proved,during assessment and appellate proceedings.that income had not accrued to it-even after receiving OC and CC.It had to produce documentary evidence that even after getting certificates projects remained incomplete and it had to incur substantial expenditure for completing them.We do not find any such exercise was done by it.Therefore, if AO and FAA held that assessee had completed projects in year under appeal and had not offered corresponding income in year in which it should have been offered,then they were not unjustified.While deciding concealment penalty cases what is to be considered is explanation filed by assessee in response to notice issued by AO for levying penalty. During course of survey proceedings and enquiries made by Department, it was found that projects undertaken by assessee had already completed and were occupied by purchasers. In these circumstances in absence of any contrary evidence it could not be said that projects were in stage of work in progress.it is fact that assessee was following method of project completion. FAA has given categorical finding of fact that after 31.3.2002 very little expenses was incurred by assessee for completing so called projects and that it had incorrectly claimed in return of income that projects were incomplete. Here we would also like to discuss cases relied upon by assessee.In case of Reliance Petroproducts Pvt.Ltd.(supra)the court has held that no information,given in return was found to be incorrect or inaccurate, that case of AO was that submitting incorrect claim in law amounted in furnishing inaccurate particulars, that interpretation adopted by AO was not as per law.The Hon'ble court had held that making incorrect 2 MA-97/M/16-Ashish Gandhi Builders & Developers claim in law did not tantamount to furnishing of inaccurate particulars In case before us, facts are totally different-the survey proceedings,as stated earlier,brought certain facts and it was found that assessee had not offered income that was to be offered for year under appeal.Therefore,in our opinion,the case relied upon by assessee is of no help.In case of Girish Devchand Rajani (supra),it was found that assessee had revised return after death of his brother who was looking after business.The Hon'ble Court had held that it was not case of revenue that assessee filed revised return as some inaccurate particulars of income were detected by AO during course of assessment.In our opinion facts of case of Girish Devchand Rajani have not relevance to case before us. In case of Navrang Internstional Hotels(supra), it was found that assessee had made payments in terms of consent decree on earlier occasions, as per order of High Court, that payments made by it were allowed. Considering those peculiar facts penalty levied u/s. 271(1)(c ) of Act was deleted by Tribunal .In our opinion facts of both cases are totally different In these circumstances, we are of opinion that order of FAA does not suffer from any legal or factual infirmity. Confirming his order, we decide effective ground of appeal against assessee . 4.1.We have referred to Log book of 9.9.2015 and find that all cases referred by assessee have been dealt with.The Tribunal had, after considering facts of case and penalty order, upheld order of FAA giving detailed reasons.As per established principles of taxation,scope of section 254(2) of Act is very limited and specific.If mistake is so glaring that on face of it same has to be amended,then only provisions of section 254(2)can be invoked.It is said that section is limited to mistake apparent from record like arithmetical errors,typographical mistakes,non-adjudication of ground of appeal or non-consideration of judgment of Hon ble Supreme Court or jurisdictional High Court having direct bearing on case. Hon ble Delhi High Court has,in matter of Geofin Investment (P.) Ltd.,described concept of mistake apparent from record as under: power is circumscribed and limited. There should be mistake which is apparent before power can be exercised. This is mandatory pre-condition. Tribunal in its order referred to controversy in question relating to disallowance made on account of short- term capital loss and long-term capital loss. entire issue was examined on merits including judgments relied upon by assessee. After examining matter in detail, it allowed appeal filed by Revenue. (348ITR118). Following is decision of Hon ble jurisdictional High Court has in case of Ramesh Electricals (203ITR497): Under section 254(2) of Income-tax Act, 1961, Appellate Tribunal may, "with view to rectifying any mistake apparent from record", amend any order passed by it under sub- section (1) within time prescribed therein. It is accepted position that Appellate Tribunal does not have any power to review its own orders under provisions of Act. only power which Tribunal possesses is to rectify any mistake in its own order which is apparent from record. This is merely power of amending its order. power of rectification under section 254(2) can be exercised only when mistake which is sought to be rectified is obvious and patent mistake which is apparent from record, and not mistake which requires to be established by arguments and long drawn process of 3 MA-97/M/16-Ashish Gandhi Builders & Developers reasoning on points on which there may conceivably be two opinions.Failure of Tribunal to consider argument advanced by either party for arriving at conclusion is not error apparent on record, although it may be error of judgment. Tribunal cannot, in exercise of its power of rectification, look into some other circumstances which would support or not support its conclusion. From above,it is clear that Tribunal has got limited power to rectify mistake u/s.254(2) of Act.In case before us,the assessee has not pointed out any arithmetical mistake in order of Tribunal nor has he proved that legal position taken by Tribunal has altered because of subsequent judgment of jurisdictional high court or apex court.The Tribunal has decided issue after considering all facts and provisions of law.In our opinion,no mistake is apparent,in impugned order of Tribunal.Therefore, we are of opinion that application filed by assessee deserves to be rejected. In result, Miscellaneous Application filed by assessee stands dismissed. Order pronounced in open court on 28th September, 2016. 28 , 2016 Sd/- Sd/- ( Sanjay Garg) (Rajendra) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai, Date: 28.09 2016. .Jv.Sr.PS. Copy of Order forwarded to : 1. Assessee 2. Respondent 3.The concerned CIT(A) , 4.The concerned CIT 5. DR Bench, ITAT, Mumbai 6. Guard File/ //True Copy// BY ORDER, Dy./Asst. Registrar ITAT, Mumbai. 4 M/s. Ashish Gandhi Builders & Developers v. Income tax Officer Ward-10(2)(3), Mumbai