- (1.) This tax case appeal, at the instance of the revenue, was admitted on the following substantial question of law: Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal is right in law and fact in deletion of the penalty levied under Section 271(1)(c) of the Act? The following additional questions of law have also been raised later and having regard to the importance of the said additional questions of law, they are also taken on file for a decision. (1) Whether on the facts and in the circumstances of the case, the Tribunal was right in law in cancelling the penalty under Section 271(1)(c) on the basis of a Miscellaneous Petition for rectification when the Tribunal has rejected a similar petition by order dated 21.8.2000, thus exceeding the jurisdiction Under Section 254(2) of the Act which does not empower the Income Tax Appellate Tribunal to review its appellate order? (2) Whether on the facts and in the circumstances of the case, the Tribunal was justified in cancelling the penalty levied under Section 271(1)(c), in an order passed on the second Miscellaneous Petition filed by the assessee which involved debatable questions of fact and reappraisal of the evidence? (3) Whether on the facts and in the circumstances of the case, the order of the Income Tax Appellate Tribunal cancelling the penalty dated 23.4.2001 on the second Miscellaneous Petition purporting to rectify the original appellate order dated 27.10.1996 is valid being barred by the period of limitation prescribed Under Section 254(2) of the Income Tax Act?
(2.) The core question to be decided in this appeal is as to whether in exercise of the provisions of Section 254(2) of the Income Tax Act, 1961, the appellate Tribunal would be entitled to entertain an application seeking for rectification of its order for the second time, when a similar application was rejected earlier?
(3.) The respondent is the proprietor of M/s Panchu Arts and he is assessed to income tax. While completing the assessment for the assessment year 1982-83 in respect of the assessee's production of a Tamil picture titled 'Ananda Ragam', the assessing officer opined that the assessee concealed with the particulars of income and furnished inaccurate particulars of income, particularly the non-disclosure of Rs. 3,00,000/- received as royalty resulting in reduction/evasion of tax. Hence a show cause notice read with Section 271(1)(c) of the Act was issued to the assessee. After considering the objections and after giving sufficient opportunity, the assessing officer quantified the penalty in a sum of Rs. 2,21,320/-. That order was carried on to the Commissioner of Income Tax (Appeals) by the assessee and the levy of penalty was confirmed. As against the said order, an appeal was filed before the Tribunal and the same was also dismissed on 27.10.96. On the ground that a mistake apparent on the face of record had crept in, the assessee preferred a Miscellaneous Petition No. 18/Mds/97. The Tribunal, by order dated 21.8.2000, dismissed the said application with the following observation: We have considered the rival submissions and perused the records. In so far as it relates to the payment of royalty, this Tribunal has considered whether it is voluntary or involuntary taking note of all the facts available on record and on the submissions made. This being the finding of fact, we are not in a position to accept the assessee's case that there was an error apparent from the record in their proceedings for the rectification. This Tribunal cannot sit over in appeal on its decision which was passed after considering relevant facts and submissions. We, therefore, do not find any merit in the stand taken by the assessee.;