MA No. 2/Ahd/2014 Arising out of I.T.(SS) No. 12/Ahd/2013 Assessment year: 2010-11 Page 1 of 5 IN INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH, AHMEDABAD [Coram: Pramod Kumar AM and Rajpal Yadav JM] MA No. 2/Ahd/2014 Arising out of I.T.(SS) No. 12/Ahd/2013 Assessment year: 2010-11 Shri Ajit Pulp & Paper Ltd Applicant Survey No. 239, Near Moral Railway Crossing Village Salvav, Via Vapi, VAPI 396 191 [PAN: AADCS3903Q] Vs. Dy Commissioner of Income Tax Central Circle 3, Surat . . Respondent Appearances by: Tushar P Hemani for applicant Prasoon Kabra for respondent Date of concluding hearing : July 15, 2016 Date of pronouncing order : October 13, 2016 ORDER Per Pramod Kumar, AM: [1] By way of this application, assessee applicant seeks rectification of certain mistakes apparent on record alleged to have crept in order dated 5th July 2013 passed by this Tribunal. [2] first mistake apparent on record, alleged to have vitiated order dated th 5 July 2013, is this. order was passed on departmental appeal filed against relief granted by CIT(A). Grounds of appeal, as set out in memorandum of appeal, were as follows: 1) learned CIT(A) has erred in law and on facts in admitting additional evidence in relation to shortage of stock, without giving AO opportunity to offer his comments, in contravention of rule 46A of IT Rules. MA No. 2/Ahd/2014 Arising out of I.T.(SS) No. 12/Ahd/2013 Assessment year: 2010-11 Page 2 of 5 2) On facts and in circumstances of case and in law, CIT(A) ought to have upheld order of AO. 3) It is, therefore, prayed that order of learned CIT(A) be set aside and that of AO be restored to above extent. [3] As rectification application states, only substantive ground before Tribunal was with respect to violation of rule 46A. This ground of appeal was dismissed by Tribunal, and yet Tribunal proceeded to adjudicate grant of relief by CIT(A) on merits. stand of applicant is that if such general grounds (as in ground no. 2 and 3) are required to be treated as substantive grounds, then there is no need to raise specific grounds at all . It is in this context that applicant points out that once Tribunal dismissed first ground of appeal, in respect of admission of additional evidence, Tribunal proceeding to deciding matter on merits was mistake apparent on record. [4] We have heard rival contentions, perused material on record and duly considered facts of case in light of applicable legal position. [5] It is only elementary that power of Tribunal, in disposing of appeal, are confined points or grounds raised before it . In this context, it is useful to refer to following observations made by Hon ble Gauhati High Court in case of Jeypore Timber & Veneer Mills (P) Ltd vs. CIT (1982) 137 ITR 415 (Gau) : "Parliament in its wisdom has conferred upon Tribunal broad and sweeping powers but at same time controlled powers by requisite constriction. provision of s. 254 of Act is enabling as well as disabling provision. passing glance creates impression that Tribunal has been endowed with plenary power under s. 254 of Act to pass any order as it thinks fit. However, it is not so, as it will appear in expression such orders thereon as it thinks fit , in s. 254. word thereon in expression is serious constriction on exercise of power by Tribunal. It can decide only points or grounds raised before it whereas IT authorities can travel beyond grounds and consider entire assessment." [Emphasis, by underlining, supplied by us] [6] powers of Tribunal are thus clearly restricted by grounds of appeal as set out in memorandum of appeal. What is not properly raised as ground before Tribunal cannot be subject matter of adjudication before Tribunal. When it comes to raising ground before Tribunal, it has to be specific and concise ground of appeal. It cannot be omnibus or vague ground of appeal. Rule 10 specifically requires that Every memorandum of appeal shall be written in English and shall set forth, concisely and under distinct heads, grounds of appeal without any argument or narrative; and such grounds shall be MA No. 2/Ahd/2014 Arising out of I.T.(SS) No. 12/Ahd/2013 Assessment year: 2010-11 Page 3 of 5 numbered consecutively . ground of appeal, in plain words, is ground on which impugned order is appealed against. In effect thus, it is ground on account of which impugned order is vitiated in law or on facts. [7] It is in this light that we have to look at grounds of appeal before Tribunal. What is termed as first ground of appeal is indeed substantive ground of appeal and there is no dispute about that that aspect. It does point out why exactly order of CIT(A) was incorrect in law, inasmuch as it constituted violation of rule 46A, and to that extent order passed by CIT(A) could not be held to be legally sustainable in law. Tribunal rejected this ground of appeal. What followed thereafter was that Tribunal proceeded to decide matter on merits under, as it is stated now, second ground of appeal. second ground of appeal, as we have noted above, states that On facts and in circumstances of case and in law, CIT(A) ought to have upheld order of AO but then it does not really point out ground on which appellant states so, and, therefore, it is required to be read in conjunction with first ground of appeal, as matter of fact only substantive ground of appeal in this appeal, rather than on standalone basis. Clearly, this cannot be ground of appeal that CIT(A) did not uphold AO s order because there cannot be independent error in not upholding order of AO. It is only error in stand taken in impugned order which can be ground of appeal. As we have noted earlier, ground of appeal is ground, or basis, on which order appealed against is said to be vitiated in law or on facts. That s cause of error rather than effect of error. order of AO not being upheld is not cause or basis of error, but it is impact of error, and that cannot, in our humble understanding, be ground of appeal. Ground no. 3 makes it even more clear when it states that It is, therefore, prayed that order of learned CIT(A) be set aside and that of AO be restored to above extent . This is also not ground of appeal either. It is at best relief sought in appeal which can only be read in conjunction with first two grounds of appeal. Clearly, just because something is stated under ground of appeal, even when it is not de facto and de jure ground of appeal, it does not become ground of appeal or is required to be treated, for purpose of our adjudication, ground of appeal. Quite clearly, on facts of this case, only ground of appeal which was required to be adjudicated by Tribunal was first ground of appeal, which was only substantive ground of appeal, i.e. learned CIT(A) has erred in law and on facts in admitting additional evidence in relation to shortage of stock, without giving AO opportunity to offer his comments, in contravention of rule 46A of IT Rules , and once this ground of appeal was decided against appellant, there was no occasion for Tribunal to deal with merits of case. Second and third grounds of appeal, i.e. on facts and in circumstances of case and in law, CIT(A) ought to have upheld order of AO and it is, therefore, prayed that order of learned CIT(A) be set aside and that of AO be restored to above extent were required to be read in conjunction with first ground of appeal, which was only substantive ground of appeal, and not as independent grounds giving powers to Tribunal to decide matter on merits. In any event, second ground of appeal did not bring out any infirmity or basis on which order was vitiated on merits MA No. 2/Ahd/2014 Arising out of I.T.(SS) No. 12/Ahd/2013 Assessment year: 2010-11 Page 4 of 5 and, by no stretch of logic, it could be treated as independent ground of appeal calling for specific adjudication by us, leave aside being treated as concise ground of appeal under rule 10. Whichever way one looks at it, adjudication on this appeal, by proceeding on basis that it required action of CIT(A) granting relief on merits to be examined, was clearly contrary to correct legal position and glaring mistake apparent on record. Any other view of matter will result in sanctioning self-aggrandizement of powers by judicial forums like this Tribunal which are creatures of statute. Unlike constitutional courts, scope of our powers are strictly limited are we must remain happily confined in those inherent limitations. To err is human but there cannot be any justification for perpetuating error. In his inimitable words, Justice Bhagwati, in case of Distributors (Baroda) (P) Ltd. vs. Union of India (1985) 155 ITR 120 (SC), had observed thus: "To perpetuate error is no heroism. To rectify it is compulsion of judicial conscience. In this, we derive comfort and strength from wise and inspiring words of Justice Bronson in Pierce vs. Delameter: Judge ought to be wise enough to know that he is fallible, and, therefore, ever ready to learn; great and honest enough to discard all mere pride of opinion and follow truth wherever it may lead; and courageous enough to acknowledge his errors. " [8] As we take note of above legal position, we may also deal with arguments of learned Departmental Representative that, in any event, it is capable of two views being taken as to whether or not, on these facts, Tribunal could have examined matter on merits, and, for this reason alone, this mistake, even if that be so, is outside scope of mistake apparent on record. No doubt, as held by Hon ble Supreme Court in landmark case of ITO Vs Volkart Bros [(1971) 82 ITR 50 (SC)], mistake apparent on record must be obvious and patent mistake and not something which can be established by long drawn process of reasoning on points on which there may conceivably be two opinions and that error which has to be established by long-drawn process of reasoning on points where there may conceivably be two opinions cannot be said to be error apparent on face of record . However, it is also important to bear in mind fact that elaborating upon scope of expression mistake apparent from record and explaining import of Hon ble Supreme Court s aforesaid landmark judgment, Full Bench of Hon ble Punjab & Haryana High Court, in case of R.A. Boga vs. AAC (1977) 110 ITR 1 (P&H)(FB), has observed that basic principle is thus clear. mistake apparent from record means obvious or patent mistake or glaring and obvious mistake . Hotly debatable issues are excluded; hardly debatable issues are included. issue may be complicated, yet mistake may be simple. It is mistake apparent from record. test is not complexity of issue but simplicity of mistake." In our humble understanding, there is nothing contrary to this decision by Hon ble jurisdictional High Court. What follows is that as long as mistake is simple, even though issue maybe complicated, it will be covered by scope of mistake apparent on record . mere complexity of issue, even if that be so, cannot be excuse enough to deny rectify simple mistake apparent on record. In present case, mistake is simple. mistake is that MA No. 2/Ahd/2014 Arising out of I.T.(SS) No. 12/Ahd/2013 Assessment year: 2010-11 Page 5 of 5 Tribunal too liberal view of its own powers and proceeded to adjudicate upon something which it was not called upon to adjudicate. This aspect of matter, in our humble understanding and for detailed reasons set out earlier, is not capable of two views being taken. legal position is clear and unambiguous. As for learned DR s pointing out that, in any event, matter was heard on merits and arguments were advanced by both parties, including counsel for assessee on merits, it is undisputed legal proposition that acquiescence does not confer jurisdiction. What is material is answer to question whether given grounds of appeal set out earlier in this order, whether Tribunal could have at all adjudicated upon on merits, and, in our humble understanding, answer is emphatic no . Such being position, it is clearly mistake apparent on record which indeed deserves to be rectified. [9] In view of above discussions, in our considered view, second and third grounds of appeal being treated as independent grounds of appeal dealing with matter on merits, giving powers to Tribunal to adjudicate upon correctness of relief granted by CIT(A) on merits, was clearly mistake apparent on record. Once ground of appeal, against violation of rule 46A was dismissed by Tribunal, matter should have rested at that because subsequent two grounds of appeal, as taken in memorandum of appeal, did not have independent existence at all. decision of Tribunal, on merits, thus must stand vacated. In result, and consequently, outcome of appeal must also stand altered to dismissed . To this extent, order dated 5th July 2013 stands rectified. [10] As we have allowed this rectification application on first issue, raised by assessee applicant, we see no reasons to take with other issues raised by us. All these issues are, given our above decision, academic and infructuous at this stage. [11] In result, miscellaneous application is allowed in terms indicated above. Pronounced in open court today on 13th day of October, 2016. Sd/- Sd/- Rajpal Yadav Pramod Kumar (Judicial Member) (Accountant Member) Dated: 13th day of October, 2016. Copies to: (1) appellant (2) respondent (3) Commissioner (4) CIT(A) (5) Departmental Representative (6) Guard File By order Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad Shri Ajit Pulp & Paper Ltd. v. Dy Commissioner of Income-tax, Central Circle-3, Surat