JUDGMENT
A.K. Sengupta, J.
1. In this application under Section 261 of the Income-tax Act, 1961, the applicant-assessee prays for certificate of fitness for appeal to the Supreme Court contending that the following questions of law purportedly substantial in nature and of general public importance, arise from the judgment of the Division Bench of this court delivered on March 24, 1993, in Reference No. 51 of 1991 (See [1993] 202 ITR 274):
“(i) In a case where the depreciation allowance is rectified in an order under Section 154 whether there is a complete merger of the order of assessment in so far as it relates to the depreciation allowance with the order of rectification ?
(ii) Whether in a case where a mistake committed in calculating the depreciation allowance in the original assessment is not corrected but repeated in subsequent rectification order dealing with the depreciation allowance, the limitation for rectifying such mistake can be computed from the date of the rectification order ?”
2. Shortly stated the facts from which the reference arose are that the assessee claimed depreciation for each of the assessment years 1976-77 to 1980-81 on factory buildings at five per cent. instead of ten per cent. admissible under the rules. The assessments were also completed accordingly. The assessments for the assessment years as aforesaid became the subject-matter of appeals on issues other than the question of the rate of depreciation on factory buildings. These appeals were decided on September 1, 1984. The appeal effect was given by the Assessing Officer on October 25, 1984, and September 4, 1986. In the appeal proceedings as also in the subsequent proceedings the question of rectification of the rate of depreciation on factory buildings was never raised. The material dates on which the aforesaid orders came to be passed are shown in the table below :
Assessment year
Date of initial assessment order
Date of order under section 154
Date of order under section 250
Date of order under section 251
1976-77
21-9-1979
12-7-1982
1-9-1984
25-10-1984
1977-78
21-9-1979
12-7-1982
1-9-1984
25-10-1984
4-9-1986
1978-79
12-8-1980
12-7-1982
1-9-1984
25-10-1984
4-9-1986
1979-80
25-5-1981
12-7-1982
1-9-1984
25-10-1984
4-9-1986
1980-81
8-1-1982
12-7-1982
. . .
25-10-1984
3. It may be observed that on July 12, 1982, there was a rectification for all the assessment years in respect of the extra shift depreciation allowance not touching the question of depreciation allowable in respect of factory buildings.
4. It was on July 4, 1986, that the assessee for the first time raised the question of the rate of depreciation on factory buildings being mistakenly taken at five per cent. instead of the correct rate of ten per cent. and the assessee contended for the rectification of the mistake. The Income-tax Officer, however, rejected the application for rectification on the ground that the limitation of time for rectification for the assessment years aforesaid had expired as the said period of limitation was to be computed from the date of the original orders of assessments as the mistake owes its origin to the original order itself and not to the subsequent rectification order. The petitioner, however, urged that the limitation is to be reckoned from the date of the order passed under Section 154, i.e., July 12, 1982, and the second petition for rectification in question having been filed on July 4, 1986, the petition was within four years and within time. The assessee’s claim failed before the Commissioner of Income-tax (Appeals) who also related the origin of the mistake to the dates of the respective original orders. But the Tribunal held that the existence of the mistake not being in question and the depreciation allowance having been rectified by a rectification order dated July 12, 1982, it has to be held that the rectification orders passed as aforesaid on July 12, 1982, contained the mistake embedded in it. Once the depreciation was rectified the entire allowance of depreciation as a whole gets merged in the rectification order irrespective of whether a particular aspect of depreciation was the subject-matter of the rectification or not. According to the Tribunal, depreciation is a single item of allowance ; so if there be multiple mistakes in giving depreciation allowance, the rectification of depreciation in any part shall be deemed to be recomputation of depreciation containing a repetition of the mistake that occurred in the original order though such mistake was not the subject-matter of that rectification. The Tribunal held that the position would have been different if the rectification orders passed on July 12, 1982, dealt with aspects other than depreciation allowance. Thus, the Tribunal held that limitation of time does not bar the assessee’s claim for rectification of the mistake in respect of the depreciation allowance on factory buildings.
5. In the reference at the instance of the Revenue, the Tribunal referred the following question to this court for opinion (See [1993] 202 ITR 274, 276) :
“On the facts and in the circumstances of the case whether the Tribunal is justified in holding that the mistake which the assessee seeks to get rectified has occurred in the set of rectification orders passed under Section 154 of the Income-tax Act, 1961, on July 12, 1982, and that date should be taken into account for purposes of computing the period of limitation ?”
6. This court held that the doctrine of partial merger shall operate also in the case of rectification in respect of depreciation allowance, because the depreciation allowance has multiple facets to be decided in the course of assessment and such facets are not correlated. In this case extra shift allowance is one aspect not having anything to do with the quantum of depreciation allowable on factory buildings. Therefore, by reason of the question of extra shift allowance having been the subject-matter of a rectification, it cannot be said that the decisions in respect of other unrelated aspects of depreciation should get merged in the depreciation allowed pursuant to such rectification. Alternatively, it cannot be accepted that all aspects of depreciation become the subject-matter of rectification even where rectification relates to one independent aspect of the depreciation allowance and that on that basis the rectification order shall be treated as containing the same mistake which owes its origin exclusively to the order of first assessment. This court held that wherever the determination of a quantum has multiple points, the doctrine of merger of the original order with the subsequent order applies only in relation to that particular point. Thus, this court held that the limitation in the case should run from the date of the original order which contained the mistake so long as that mistake in particular was not subjected to any recomputation.
7. It is in this background that the present application has been pressed before us. We find that the issues arising from the question decided by us is free from controversy and cannot be said to present any difficulty to be resolved by the Supreme Court since the law now recognises partial merger in taxation. Sub-section (1A) of Section 154 makes the matter clear. In that view, we cannot persuade ourselves to certify that a question, fit for appeal to the Supreme Court, has arisen.
8. The application is rejected.
9. There will be no order as to costs.
N.A. Chowdhury, J.
10. I agree.