CBDT Grants CPC Power to Rectify AO Orders for Accounting Errors

Notification u/s 120 of the Income Tax Act, 1961 regarding proposal for CPC ITR to initiate rectification of orders passed by Assessing Officers due to errors in accounting due to erroneous accounting

The Central Board of Direct Taxes (CBDT), through Notification No. 155/2025-Income Tax dated October 27, 2025, has conferred concurrent statutory powers upon the Commissioner of Income Tax, Centralized Processing Centre (CPC), Bengaluru. This notification applies to all cases where assessment orders were passed using the interface between the Assessing Officer and the CPC. The conferred powers include the authority under Section 154 of the Income-tax Act, 1961, to rectify mistakes apparent from the record. This encompasses errors like incorrect computation of tax, refund, or demand; non-consideration of prepaid tax credit or eligible reliefs; and faulty interest calculation under Section $244A$. Additionally, the Commissioner is authorized to issue a notice of demand under Section 156 in such cases. The notification also includes provisions allowing the Commissioner to formally delegate these functions and powers to subordinate tax authorities, specifically the Additional Commissioners or Joint Commissioners of Income-tax, who can further delegate them to Assessing Officers under their control. The delegation must adhere to the jurisdiction—cases or persons—specified in the Schedule. This directive became effective upon its publication in the Official Gazette.

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)

Notification No. 155/2025- Income Tax | Dated: 27th October, 2025

S.O. 4901(E).— In exercise of the powers conferred by sub-sections (1) and (2) of section 120 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby: –

(a) directs that the Commissioner of Income-tax specified in column (2) of the Schedule hereto annexed, having his headquarter at the place specified in the corresponding entry in column (3) of the said schedule, shall exercise the concurrent powers: –

i. to rectify u/s 154 of the IT Act 1961, the mistakes which are apparent from records including any refund issued earlier under the provisions of the Act and/or non-consideration of any pre-paid tax credit and/or non-consideration of any relief eligible and/or calculation of interest u/s 244A of the IT Act 1961, in passing any order under the Income-tax Act resulting in error in computation of the Tax and/or refund determined and/or demand;

ii. to issue notice of demand under section 156 of the Income-tax Act, 1961 in such cases covered under (a) above.

in respect of such territorial area or such cases or classes of cases or such persons or classes of persons specified in the corresponding entry in column (4) of the said Schedule and in respect of all income or classes of income thereof;

(b) authorizes the Commissioner of Income-tax referred to in this notification to issue orders in writing for the exercise of the powers and performance of the functions by the Additional Commissioners or Joint Commissioners of Income-tax, who are subordinate to him, in respect of such territorial area or such persons or classes of persons or of such income or classes of income or of such cases or classes of cases specified in the corresponding entry in column (4) of the said Schedule;

(c) authorizes the Additional Commissioners or Joint Commissioners of Income-tax referred to in clause (b) of this notification, to issue orders in writing for the exercise of the powers and performance of the functions by the Assessing Officers, who are subordinate to them, in respect of such territorial area or such persons or classes of persons or income or classes of income, or cases or classes of cases specified in the corresponding entry in column (4) of the said Schedule, in respect of which such Additional Commissioners or Joint Commissioners of Income-tax are authorized by the Commissioner of Income-tax under clause (b) of this notification.

SCHEDULE

2. This notification shall come into force from the date of its publication in the official Gazette.

[Notification No. 155/2025/F. No. CB/362/2025-O/o Addl. DIT 6 CPC Bengaluru-187/10/2024-ITA-I]
MEENAKSHI SINGH, Dy. Secy.