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2020 ] MALABAR REGIONAL CO-OP. MILK PRODUCERS UNION LTD. v. C.C.E., COCHIN 713

apparent from the record. However, if a decision is based on more than one ma-
terial, then merely because in the process of arriving at the final decision reliance
was placed on some material which could not have been used, it can never be
said that, in the final decision there is a mistake apparent from the record, be-
cause the final opinion could also have been based on the other material which
was relevant and which could have been used.
14. In Mepco Industries Ltd. v. Commissioner of Income Tax [2009 (248)
E.L.T. 3 (S.C.)], the Hon’ble Supreme Court had occasion to consider the scope of
Section 154 of the Income-tax Act, 1961 which is in pari materia with Section
35C(2) of the Central Excise Act, 1944. Question considered was whether it was
open to the Commissioner of Income Tax to rectify its own order under Section
154, on the basis of the judgment of the Supreme Court (later judgment). The
Apex Court analyzed as to whether there existed a ‘rectifiable mistake’ enabling
the Department to invoke Section 154 of the Act. It was found that, there is a
clear dichotomy between Sections 154 and 147 of the Income-tax Act. Section 154
deals with rectification of mistake which inter alia states that, with a view to recti-
fy any mistake apparent from the record, an Income Tax Authority may amend
any order passed by it. Whereas Section 147, inter alia, states that, if the As-
sessing Officer has reason to believe that any income charged to tax had escaped
assessment for any assessment year, he may, subject to other provisions con-
tained in the Act, assess or reassess such income which had escaped the assess-
ment. On the facts of the said case, on the basis of a subsequent decision of the
Hon’ble Supreme Court the Commissioner of Income Tax took a view that the
subsidy in question was a revenue receipt. The Hon’ble Supreme Court found
that, it is a classic illustration of change of opinion, and it is not a mistake appar-
ent on records.
15. Decision of the Calcutta High Court which was impugned in the
above referred case of the Hon’ble Supreme Court, finding was that the subse-
quent decision of the Supreme Court will not obliterate the conflict of opinion
prior to it. Under such circumstances, a rectification was not permissible on a
debatable issue under Section 154 of the Act, was the finding. In Kil Kotagiri Tea
and Coffee Estates Company Ltd. v. Income Tax Appellate Tribunal & Others, (1988)
174 ITR 579, it is held that the rectification contemplated under Section 154 must
be a “rectifiable mistake”. It should be a mistake in the light of law in force at the
time when the order sought to be rectified was passed. Therefore in Mepco Indus-
tries Ltd. (supra) it was held by the Apex Court that, when there is a change of
opinion, the department will be erred in invoking Section 154 of the Act.
16. In another decision of the Apex Court in Commissioner of Sales Tax,
U.P. v. Bharat Bone Mill, 2007 (210) E.L.T. 6 (S.C.), after referring to the decision in
Income Tax Officer, Alwaye v. The Asok Textiles Ltd., Alwaye [(1961) SCR 236] it was
held that, provision for rectification of mistake apparent on the record, cannot be
equated with the power of a civil Court to review its own order as envisaged un-
der Order XLVII Rule 1 of the Code of Civil Procedure. In the decision of the
High Court of Calcutta in Smriti Properties Pvt. Ltd. v. Settlement Commission [2005
(191) E.L.T. 128 (Cal.)] it was held that, retrospective operation of the Supreme
Court pronouncements on the interpretation of law can be made applicable only
in cases which had not been decided finally and the same is pending for adjudi-
cation. Finding in this respect was made with reference to another Supreme
Court decision in M.A. Murthy v. State of Karnataka [(2003) 7 SCC 517]. One can-
not take advantage of the subsequent pronouncement of superior Court in a
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