Debangsu Basak, J. - (1.) The petitioner has challenged 3 notices, all dated March 21, 2000, issued under Section 154 of the Income Tax Act, 1961 for the assessment years 1991-92, 1992-93 and 1993-94.
(2.) Learned senior advocate appearing for the petitioner has submitted that, the impugned notices are without jurisdiction. According to him, section 154 of the Income Tax Act, 1961 can be invoked only when there is an error apparent on the face of the record. According to him, the assessment orders, in respect of which the impugned notices have been issued, cannot be said to contain any error on the face of the record. In the present case, the assessment for the assessment year 1991-92 was made on March 31, 1994. The assessment for the assessment year 1992-1993 was made on March 31, 1995 and the assessment in respect of the assessment year 1993-94 was made on March 29, 1996. The impugned notices were issued on March 21, 2000. The petitioner set up new units at the tea garden for the period from 1991 to 1994. The question as to whether blending of tea is production or manufacture is debatable. There are authorities on both sides of the divide. As there was a debate on such a point, it cannot be said that, there is an error apparent on the face of the record requiring invocation of Section 154 of the Act of 1961. He has drawn the attention of the Court to the fact that, the Tribunal has taken a view in its order dated November 30, 1992 that, the assessee was engaged in the manufacturing and production of tea and coffee. An appeal has since been admitted by the Hon'ble High Court at Calcutta. Appeal is admitted on a question of law. Such appeal is pending. Therefore, according to him, the issue still being at large, it does not permit invocation of Section 154 of the Act of 1961.
(3.) Relying upon (TATA Tea Ltd. v. Assistant Commissioner of Income-Tax, 2011 338 ITR 285 (Kerela)) learned senior advocate appearing for the petitioner has submitted that, there must be an error apparent on the face of the record for invocation of Section 154 of the Act of 1961. He has relied upon (Harbans Lal Malhotra & Sons Private Ltd. v. Income-Tax Officer, "C" Ward, COMP. Dist. II, Calcutta & Anr, 1972 83 ITR 848.) and (Income Tax Settlement Commission & Ors. v. Netai Chandra Rarhi & Ors., 2004 271 ITR 514) and submitted that, Section 154 of the Act of 1961 cannot be invoked when there is a mixed question of law and fact involved. Moreover, when the issue is debatable, the same cannot be invoked. In support of such contention, he has relied upon (Md. Serajuddin & Bros. v. Commissioner of Income-Tax,2012 24 taxman.com 46 (Cal)). He submitted that, a judgment of the Supreme Court does not obliterate a debate. In support of such contention, he has relied upon (Jiyajeerao Cotton Mills Ltd. v. Income-Tax Officer, "C" Ward, Companies District I, Calcutta & Ors, 1981 130 ITR 710.). Subsequent exposition of law cannot form basis of a rectification proceedings and in support of such contention he has relied upon (Geo Miller and Co. Ltd. v. Deputy Commissioner of Income Tax & Ors, 2003 262 ITR 237.). He has submitted that, (Appeejay Pvt. Ltd. v. Commissioner of Income-Tax, 1994 206 ITR 367 (Cal)) cannot form the basis of the proceedings under section 154 of the Act of 1961. The judgment and order of Appeejay Pvt. Ltd. (supra) was delivered on September 10, 1991 and the impugned notices were issued on March 21, 2000. In any event, the factual aspects as to whether or not, the petitioner installed new machineries at the units, is required to be looked into. In support of the contention that, blending is a manufacturing activity, learned senior advocate appearing for the petitioner has relied upon (Brooke Bond Lipton India Ltd. v. State of Karnataka, 1998 109 STC 265(Kar) ). Relying upon (Geo Miller & Co. Ltd. v. Deputy Commissioner of Income-Tax & Ors, 2003 262 ITR 237.) learned senior advocate appearing for the petitioner has submitted that, a subsequent judgment does not make the order of assessment a mistake. Therefore, according to him, the impugned notices being without jurisdiction should be quashed.;