In Brief
The Revenue appealed against a High Court order that upheld the ITAT's recall of its own earlier decision on software licensing and royalty taxation under the Income Tax Act. The Supreme Court held that the ITAT exceeded its powers under Section 254(2) by reopening and rehearing the case on merits rather than merely correcting clerical errors. Section 254(2) permits only rectification of mistakes apparent from the record, not reconsideration of substantive findings. The Court restored the original ITAT order and allowed the assessee to file a fresh High Court appeal against it within six weeks without limitation objections. The appeals of the Revenue were allowed.
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