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June, 14th 2014

%                                              DECIDED ON: 06.05.2014

+                        ITA 199/2014
      PAWAN KUMAR AGGARWAL                                   ..... Appellant
                 Through: Mr. Ved Jain with
                 Mr. Pranjal, Advocates.


      COMMISSIONER OF INCOME TAX             ..... Respondent
                  Through: Mr. Rohit Madan, Sr. Standing Counsel
                  with Mr. Akash Vajpai, Advocate.



      1.    Issue notice. Mr. Rohit Madan, Sr. Standing Counsel accepts
      notice on behalf of the respondent.
      2.    The question of law which arises for consideration is, "whether
      the ITAT fell into error in rejecting the assessee's claim for credit of
      Securities Transaction Tax (STT), proof of which was concededly
      attached to the return."
      3.    The relevant facts are that the assessee reported a total income
      of `34.56 lakhs for AY 2008-09. The income tax payable including

ITA 199/2014                                                            Page 1
     surcharge and education cess was `1,16,950/-. In the computation of
     income, the assessee failed to disclose the STT paid to the tune of
     `18,93,867/-. Instead of disclosing it as STT paid, the amount was
     erroneously mentioned as TDS.       The AO rejected the assessee's
     application, in the form of letter of 22.11.2012, whereby the assessee
     requested rectification of the intimation. The AO's order of 16.1.2013
     was unsuccessfully appealed. The assessee further appealed to the
     ITAT which rejected its contentions, by the impugned order. The
     ITAT was of the opinion that the assessee mentioned that the income
     arising out of transaction chargeable to STT chargeable under the
     head 'profits and gains of business or profession' included in the
     gross income was shown to be NIL and that the tax payable on that
     amount at an average amount of tax was also NIL and consequently
     the rebate allowable under Section 88E was likewise zero. The ITAT,
     therefore, reasoned as follows: -
           "That when in the return of income the assessee himself has
           mentioned that the income arising from the transaction
           chargeable to securities transaction tax is nil and the rebate
           allowable under Section 88E is nil, then, the Assessing Officer
           cannot be said to have committed any error in the intimation
           under Section 143(1) in not allowing rebate under Section 88E.
           ·That under Section 154, the jurisdiction of the Assessing
           Officer is to rectify the mistake apparent from the record.
           Under Section 143(1), the Assessing Officer has processed the
           return as furnished by the assessee. Therefore, the mistake is to
           be seen in the light of the return filed by the assessee. If the
           assessee has committed any mistake in filling the return of
           income, the same cannot be rectified by the Assessing Officer
           under Section 154. The assessee contended that the STT paid by
           the assessee was filled in the wrong column, i.e., in the column
           of TDS. However, we find that from the details as furnished in

ITA 199/2014                                                         Page 2
            the column of TDS, it cannot be inferred by the Assessing
            Officer that it is STT. Moreover, as we have already mentioned
            that for the purpose of Section 88E, mere payment of STT
            would not entitle the assessee to claim the rebate. The assessee
            would be entitled to rebate only if the total income of the
            assessee included the income arising from the taxable
            securities transactions. In the return of income, the assessee
            himself has mentioned the income arising from transactions
            chargeable to securities transaction tax to be nil. In the
            computation of income also, there is no mention about any such
            income. The assessee has claimed to have furnished the
            certificate of STT collected by Adroit Financial Services Pvt.
            Ltd. However, the certificate only mentions the transaction
            entered into by the assessee but it nowhere mentions the income
            arising from such transaction."

      4.    It is urged by the learned counsel that the Tribunal fell into an
      error in overlooking Section 154(1)(b) of the Income Tax Act, 1961,
      which allows the amendment of even intimation or deemed intimation
      under Section 143 (1) of the Act. The counsel also relied upon
      Section 154 (1A) of the Act to say that even after decision in any
      proceeding by way of an appeal or revision, it is upon the assessee or
      the party concerned to seek recourse to Section 154 (1). He relied
      upon the ruling reported as Commissioner of Income Tax v. Sam
      Global Securities Ltd., 2013 (9) TMI 876 (Delhi).
      5.    The learned counsel for the Revenue urged that this Court
      should not interfere with the findings of the Tribunal since the
      assessee was at fault and had in the income tax return form at the
      appropriate place mentioned the TDS to be `18,93,867/- which was
      found to be inaccurate. In these circumstances, there was no question
      of any error or mistake on the part of the AO which could be

ITA 199/2014                                                          Page 3
      6.    Section 154 to the extent it is relevant is extracted below: -
            "Rectification of mistake.
            154. [(1) With a view to rectifying any mistake apparent from the
            record an income-tax authority referred to in section 116 may, -
            (a) amend any order passed by it under the provisions of this Act ;
            [(b) amend any intimation or deemed intimation under sub-
            section (1) of section 143.]]
            [(1A) Where any matter has been considered and decided in any
            proceeding by way of appeal or revision relating to an order
            referred to in sub-section (1), the authority passing such order
            may, notwithstanding anything contained in any law for the time
            being in force, amend the order under that sub-section in relation
            to any matter other than the matter which has been so considered
            and decided.]
            (2) Subject to the other provisions of this section, the authority
            (a) may make an amendment under sub-section (1) of its own
             motion, and
            (b) shall make such amendment for rectifying any such mistake
            which has been brought to its notice by the assessee, and where
            the authority concerned is the [***] [Commissioner (Appeals)],
            by the [Assessing] Officer also."

      It is apparent from the bare reading of the above provision that the
      power of rectification extends to amendment of an intimation or
      deemed intimation under Section 143. This power enures even after
      ,,the matter has been considered and decided in any proceeding by
      way of appeal or revision. Necessarily, this power extends even at
      the stage of the appeal and the further appeal to the ITAT. Even after
      such decision, it is open to the AO to amend the intimation under
      Section 143 (1) if the circumstances so warrant. We are wholly in

ITA 199/2014                                                             Page 4
      agreement with the decision in Sam Global's matter (supra) that the
      technicalities in the given circumstances of the case ought not to
      obscure the justice. The justice demands, in the peculiar facts of the
      case, that there is no impediment to relief. That appears to have been
      overlooked in entirety by the lower authorities and the Tribunal had
      failed to notice that the controlling expression in Section 154 is not
      "an error" which is somewhat coloured by the exercise of power by
      the authorities. Instead, the controlling expression is "any mistake"
      which has wider connotation and includes mistakes committed by the
      parties also.
      7. In view of the above discussion, the question of law framed has to
      be answered in favour of the assessee and against the Revenue. The
      appeal is consequently allowed but without any order as to costs.

                                              S. RAVINDRA BHAT

                                                        VIBHU BAKHRU
     MAY 06, 2014

ITA 199/2014                                                          Page 5
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