G.S.SINGHVI, J. - (1.) WHETHER the Tribunal can, while deciding an application under S. 254(2) of the IT Act, 1961, (for short, "the Act"), review or revise an order passed under S. 254(1) is the question that arises for consideration in this petition filed for quashing the order dt. 20th Jan., 1999, passed by the Income -tax Appellate Tribunal, Amritsar Bench, Amritsar, (for short "the Tribunal") vide which it allowed the miscellaneous application filed by the Department and recalled the order, dt. 15th Dec., 1997.
(2.) THE facts of the case lie in a narrow compass. The petitioner filed a return for the asst. year 1992 - 93 declaring nil income by claiming deduction of Rs. 49,86,664 under S. 80HHC of the Act. The AO disallowed the claim of deduction and finalised the assessment under S. 143(3) of the Act. The appeal filed by the petitioner was allowed by the Commissioner of Income -tax (Appeals), Jalandhar (for short "the [CIT(A)")]. He set aside the order of assessment and remanded the case to the AO with a direction to allow the deduction. The Tribunal confirmed the order of the CIT(A) and dismissed the appeal filed by the Department. However, it accepted the reference application filed under S. 256(1) of the Act and referred the following questions to this Court for its opinion : "1. Whether, on the facts and in the circumstances of the case, the learned Tribunal was right in law in dismissing the appeal of the Revenue and upholding the order of the learned CIT(A) that the term 'profit' in the proviso to Sub -S. (3) of S. 80HHC of the IT Act, 1961, can be stretched to include the term 'loss' whereby directing to allow the deduction as claimed by the assessee -firm - 2. Whether, on the facts and in the circumstances of the case, the learned Tribunal was right in law in dismissing the appeal of the Revenue and upholding the order of the learned CIT(A) whereby directing that income earned by sale of scrap made in India is entitled to deduction under S. 80HHC of the IT Act, 1961, and does not form part of the total turnover -
(3.) IN the meanwhile, the ITO, Ward -I, Phagwara (respondent No. 2), filed an application before the Tribunal for recall of the order dt. 15th Dec., 1997, on the ground that it had not considered the Department's plea on the merits. In response to the notice issued by the Tribunal, the petitioner filed a reply questioning the very maintainability of the application on the ground that a reference made to the High Court is pending. It also pleaded that the order, dt. 15th Dec., 1997, did not suffer from any mistake apparent from the record and, therefore, there was no justification to recall the same. After hearing the representatives of the Department and the petitioner, the Tribunal allowed the application and recalled the appeal for deciding the issue of allowance of deduction afresh. Shri G.C. Sharma, senior advocate appearing for the petitioner, submitted that even though the application filed by respondent No. 2 did not contain reference to the provision of law under which it has been filed, the same must be treated as an application under S. 254(2) of the Act and the Court may accordingly decide the issue raised in this petition. He argued that the power vested in the Tribunal under S. 254(2) can be exercised only for rectifying a mistake apparent from the record and not for reviewing/revising an order made under S. 254(1) and submitted that the order dt. 15th Dec., 1997, passed by the Tribunal did not suffer from any mistake apparent justifying its review in the garb of recall. He then argued that the absence of detailed reasons in the order dt. 15th Dec., 1997, cannot be construed as a mistake apparent within the meaning of S. 254(2) of the Act because the Tribunal had expressly concurred with the reasons assigned by the CIT(A). In support of his arguments, learned counsel relied on the following decisions : (1) CIT vs. K.Y. Pilliah and Sons (1967) 63 ITR 411 (SC) : TC 8R.726; (2) CIT vs. ITAT (1992) 101 CTR (Ori) 291 : (1992) 196 ITR 683 (Ori) : TC 8R.1293 (3) CIT vs. ITAT (1994) 118 CTR (AP) 187 : (1994) 206 ITR 126 (AP) : TC S8.975 (4) Asstt. CIT vs. Dr. Ved Prakash (1994) 122 CTR (AP) 362 : (1994) 209 ITR 448 (AP) : TC S8.976 (5) CIT vs. ITAT (1997) 143 CTR (All) 447 : (1997) 227 ITR 443 (All) : TC S8.989; and (6) Shaw Wallace and Co. Ltd. vs. ITAT (1999) 155 CTR (Cal) 502 : (1999) 240 ITR 579 (Cal). ;