R.K.Agrawal J. - (1.) The Income-tax Appellate Tribunal, Allahabad, has referred the following question of law under Section 256(2) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), for opinion to this court : "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in dismissing the application under Section 254(2) of the Act on the ground that it was virtually a review application ?"
(2.) Briefly stated, the facts giving rise to the present reference are as follows : The reference relates to the assessment year 1977-78. During the assessment year in question the Income-tax Officer had disallowed a sum of Rs. 55,383 out of interest claimed by the applicant on the ground that part of the borrowings, have not been utilised by the applicant for the purposes of its business. The disallowance has been upheld by the Tribunal. The application filed under Section 256(1) of the Act, seeking reference has been rejected by the Tribunal. Thereafter, the applicant filed a miscellaneous application purporting to be under Section 254(2) of the Act contending that the order of the Tribunal suffered from a mistake apparent on the record as it has not given any finding that any part of the capital borrowed by it, has not been utilised for the purposes of business and, therefore, the interest claimed, and as deducted under Section 36(1)(iii) of the Act, could not be disallowed. The applicant had referred to a decision of the Madhya Pradesh High Court in the case of D and H Secheron Electrodes Pvt. Ltd. v. CIT [1983] 142 ITR528 (MP). The Tribunal had rejected the said application on the ground that under Section 254(2) of the Act, it is empowered to rectify any mistake which is apparent from the record and it has no power to review its own order. Through the present application, the applicant wants the review of its order dated August 30, 1980, which obviously cannot be done.
(3.) We have heard Sri S. B. L. Srivastava, learned counsel for the petitioner, and Sri Shambhoo Chopra, learned standing counsel appearing for the Revenue.;