Commissioner of Income Tax vs Devidayal Aluminium Industries

We have heard Sri A.N. Mahajan learned counsel for the applicant and Sri Piyush Agarwal learned counsel for the respondents.

Additional depreciation of Rs. 33,899 on the cost of computer was allowed to the assessee by the Assistant Commissioner of Income Tax u/s 143(3) of the Income Tax Act. Subsequently he by order dated 9-3-1989 rectified the mistake u/s 154 of the Income Tax Act on the ground that the mistake was apparent from the record and withdrew the investment allowance and depreciation on care and computer. This order was challenged by the assessee before the Commissioner of Income Tax who allowed the appeal on 17-6-1991. The department filed an appeal before the Income Tax Appellate Tribunal that had been dismissed on 26-7-1996. This Income Tax application has been filed u/s 256(2) of the Act.

The application filed by the department u/s 256(1) of the Act had been dismissed by the Tribunal. The department filed an application u/s 256(2) for calling of question of law. The Tribunal has rejected the claim of the department. The Tribunal has held that the question whether investment allowance and depreciation is a debatable question, therefore, it is not an error apparent on the face of the record. The Apex Court in T.S. Balaram, Income Tax Officer, Company Circle IV, Bombay Vs. Volkart Brothers, Bombay, held as under :

"a mistake apparent on the face of the record must be an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on which there may be conceivably two opinions. A decision on a debatable point of law is not a mistake apparent from the record".

In view of the aforesaid judgment of the Apex Court, we do not find that this is a fit case to call for a question of law.

The application is accordingly rejected.