Sachin Sawhney Vs ITO (ITAT Jaipur)
Section 154 cannot review refusal to condone appeal delay; deduction merits outside rectification appeal: ITAT
Rectification Cannot Reopen Delayed Appeal: ITAT Jaipur Upholds Section 154 Rejection
Section 154 rectification cannot review a delayed appeal dismissal; ITAT Jaipur leaves Section 80JJA deduction and interest questions open.
Legal principle and decision
The Income Tax Appellate Tribunal, Jaipur, held that rectification under section 154 is confined to correcting a mistake apparent from the record. It cannot be used to review or reopen an issue requiring reconsideration beyond that limited statutory scope.
The Tribunal upheld rejection of the assessee’s rectification application concerning an appellate order that had declined to admit his delayed appeal. It also held that the underlying section 80JJA deduction dispute and consequential interest did not require adjudication in an appeal directed against rejection of rectification. The assessee remained free to pursue the appropriate remedy against the original appellate order.
Original appeal dismissed on limitation
The dispute arose from the assessee’s challenge concerning assessment year 2018-19. His original appeal before the CIT(A) was filed with a delay of 211 days.
By an order dated 27.11.2021, the CIT(A) declined to admit that appeal because the assessee had failed to establish sufficient cause for the delay. The dismissal was therefore based on section 249(3), rather than an adjudication allowing or rejecting the substantive deduction claim on its merits.
The assessee subsequently sought rectification of that appellate order under section 154. The CIT(A) rejected the application, observing that the original appeal had not been admitted and that the claim raised in rectification did not establish an apparent mistake.
Assessee alleged incorrect reading of deduction claim
Before the Tribunal, the assessee challenged both the rectification rejection and aspects of the original appellate proceedings. His grounds alleged that adequate opportunity, including a personal hearing, had not been provided.
He also contended that the appellate authority had misread the deduction claimed under section 80JJA as one under section 80JJAA. According to him, this constituted a mistake apparent from the record requiring correction.
The assessee further disputed the reasoning that rectification could be rejected because the original appeal had not been admitted. He maintained that he had not received an opportunity to place the relevant submissions before the authority.
These assertions formed part of his challenge, but the Tribunal examined them within the limited scope of the rectification appeal.
Underlying processing adjustment also challenged
The assessee’s grounds additionally questioned the Centralised Processing Centre’s disallowance of the section 80JJA deduction.
He argued that, before the amendment made by the Finance Act, 2020, section 143(1)(a)(v) did not permit that deduction to be disallowed through processing merely because the return was furnished after the due date.
He also challenged interest under sections 234A, 234B and 234C. However, these were grounds concerning the underlying tax adjustment and its consequences. Their inclusion did not change the nature of the order actually under appeal, namely, the rejection of the section 154 application.
Rectification cannot substitute for reconsideration
The Tribunal noted that the original appellate order had declined admission because of delay. The later application sought rectification of that order.
It explained that section 154 does not confer a general power of review. An issue that requires reopening or reconsideration beyond correction of an apparent error cannot be decided by invoking rectification.
In the present case, the CIT(A) had rejected the application because no mistake apparent from the record was established. The Tribunal found no infirmity in that conclusion.
The ruling therefore maintained the distinction between correcting a demonstrable record-based mistake and obtaining a fresh examination of an adverse appellate decision. The latter must be pursued through the appropriate legal remedy.
Deduction and interest merits left undecided
The Tribunal expressly declined to adjudicate the grounds concerning disallowance under section 80JJA and consequential interest. Those matters were outside the determination required in the appeal against rejection of rectification.
Accordingly, the order does not decide whether the assessee was substantively entitled to the deduction. It also does not determine the correctness of his argument about the scope of section 143(1)(a)(v) before the Finance Act, 2020 amendment.
Similarly, the Tribunal did not treat the alleged confusion between sections 80JJA and 80JJAA as establishing a rectifiable mistake warranting interference. Its conclusion remained that the impugned rectification rejection was sustainable in the circumstances.
Liberty to challenge the original order
While dismissing the appeal, the Tribunal preserved the assessee’s liberty to pursue the appropriate remedy against the original appellate order dated 27.11.2021, in accordance with law.
It further clarified that any application seeking condonation of delay in pursuing that remedy must be considered by the competent Bench independently, on its own merits.
This direction did not itself condone any delay or restore the original appeal. It left those questions for determination in properly instituted proceedings.
Final outcome
The assessee’s appeal was dismissed, and the rejection of his section 154 application remained intact.
The decision underscores that a rectification appeal cannot become a substitute for challenging the original refusal to admit an appeal. Questions concerning limitation, substantive deduction eligibility and interest must be pursued through the appropriate remedy, while section 154 remains confined to apparent mistakes.
No judicial precedent is expressly cited in the Tribunal’s substantive order.
FULL TEXT OF THE JUDGMENT/ORDER OF ITAT JAIPUR
This appeal by the assessee is directed against order dated 27.11.2021 passed by the Ld. National Faceless Appeal Centre, Delhi (hereinafter referred to as “Ld. CIT(A)”) for assessment year 2018-19, under Section 154 read with Section 250 of the Income Tax Act, 1961 (in short the Act).
2. The grounds raised by the assessee read as under:-
1. Under the facts and the circumstances of the case and in law, the impugned order u/s 154 r.w.s. 250 of the Act dated 24.03.2025 and the ex-parte original appeal order dated 27.11.2021 u/s 250 of the Income Tax Act, 1961 [“the Act”] passed by the Learned National Faceless Appeal Centre, [hereinafter referred to as “Ld. NFAC”] is perverse, arbitrary, without jurisdiction and bad in law.
2. Under the facts and circumstances of the case and in law, Ld. NFAC has grossly erred in passing Impugned order u/s 154 r.w.s 250 of the Act and the ex-parte original appeal order u/s 250 of the Act without providing adequate opportunity of being heard including personal hearing, thereby violating the principle of natural justice.
3. Under the facts and circumstances of the case and in the Ld. NFAC has committed a grave error while passing the original appeal order u/s 250 of the Act by incorrectly perusing the material on record and misinterpreting the issue by misreading the disallowance of deduction u/s “80JJA” as “80JJAA” which is a mistake apparent from face of the record.
4. Under the facts and circumstances of the case and in law, the Ld. NFAC has passed an arbitrary order u/s 154 r.w.s 250 of the Act dated 24.03.2025 without rectifying the mistake apparent from record by justifying that the original appeal was not admitted, however no opportunity to place on record the submissions was provided to the appellant.
5. Under the facts and circumstances of the case and in law, the Ld. NFAC has erred in upholding the disallowance of deduction u/s 80JJA made by the CPC without considering the fact that u/s 143(1) (a)(v) no disallowance of deduction of Section 80JJA could have been made even if the return of income is furnished after the due date, prior to the amendment made in the Finance Act, 2020.
6. Under the facts and the circumstances of the case and in law, the Ld. NFAC has erred in confirming the interest levied u/s 234A/B/C of the Act.
7. The appellant craves leave to add, amend, alter, revise and modify any of the grounds of appeal on, before or in the course of hearing of the appeal
3. At the outset, the learned counsel for the assessee submitted that, by the original order dated 27.11.2021 passed under section 250 of the Act, the learned CIT(A) had declined to admit the appeal on account of the assessee’s failure to establish sufficient cause for the delay of 211 days in filing the appeal. The assessee thereafter filed an application seeking rectification of the said order, which was rejected by the learned CIT(A), observing as under: 2.1 The appellant filed the rectification petition against the order U/s. 250 dated 27.11.2021. On perusal of the order dated 27.11.2021, it is noticed that the appeal filed by the appellant was not admitted and dismissed as per the provisions of section 249(3) of the act. From the records, it is observed that the claim of appellant in the rectification is not a mistake apparent from the record as per Section 154.
4. We have heard the rival submissions and perused the material available on record. The original appellate order dated 27.11.2021 shows that the learned CIT(A) declined to admit the appeal under section 249(3) of the Act on account of the delay in filing the appeal. The subsequent application under section 154 sought rectification of that order. However, the power of rectification under section 154 is confined to correcting a mistake apparent from the record and cannot be exercised to review or reopen an issue requiring reconsideration beyond the scope of that provision.
5. In the present case, the learned CIT(A) rejected the rectification application on the ground that no mistake apparent from the record had been established. In the circumstances, we find no infirmity in the impugned order rejecting the application under section 154. The grounds challenging the merits of the disallowance under section 80JJA and the consequential levy of interest do not require adjudication in the present appeal, which is directed against the order rejecting rectification.
6. The assessee, however, shall be at liberty to pursue the appropriate remedy, in accordance with law, against the original appellate order dated 27.11.2021. Any application for condonation of delay in pursuing such remedy shall be considered by the competent Bench in accordance with law, on its own merits.
7. In the result, the appeal of the assessee is dismissed.
Order pronounced in the Open Court on 16.10.2026
