1. The High Court answered in the affirmative and against the Revenue the following question:
“Whether on the facts and in the circumstances of the case the Tribunal was justified in upholding the finding of the learned CIT (A) who cancelled the order of the assessing officer passed on 18-6-1991 under Section 154 of the Income Tax Act, 1961?”
2. The Revenue is in appeal. The order of assessment was made on 30-3-1990. It was then rectified under Section 154 of the Income Tax Act, 1961 because the assessing officer found that depreciation under the Companies Act had been allowed at Rs 11,53,374 whereas it was actually allowable at Rs 11,38,057. He also found that unabsorbed depreciation had been taken at Rs 12,99,368 as against unabsorbed loss of Rs 17,230. He was of the opinion that there was a mistake apparent from the record and he made the rectification after giving to the assessee the opportunity of being heard.
3. In appeal, the Commissioner of Income Tax (Appeals) cancelled the order under Section 154. He noted that the mistake to be rectified had to be apparent from the record; it had to be an obvious mistake and not something on which there might conceivably be two points of view. The Income Tax Appellate Tribunal confirmed the view taken by the Commissioner (Appeals).
4. On the application of the Revenue, the Tribunal referred the question aforementioned to the High Court and it drew up a statement of case.
5. The High Court answered the reference, as aforestated, in favour of the assessee, holding that the Tribunal and the Commissioner of Appeals were justified in taking the view that no occasion for rectification arose. It also opined that these were questions of fact and no question of law arose.
6. We have heard learned counsel. We do not agree that the question raises a pure question of fact; to that extent, the High Court was in error. But it was not in error in coming to the conclusion that there was no occasion for rectification. Under the provisions of Section 154 there has to be a mistake apparent from the record. In other words, a look at the record must show that there has been an error and that error may be rectified. Learned counsel for the Revenue has not been able to satisfy us that it shows any apparent error upon the record. Reference to documents outside the record and the law is impermissible when applying the provisions of Section 154.
7. The appeal is dismissed. No order as to costs.