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Article discusses about Order which can be rectified under section 154 of Income Tax Act, 1961, Rectification of Income Tax order which is subject to appeal or revision, Initiation of rectification by whom, Time-limit for rectification, The procedure to be followed for making an application for rectification, etc.
Introduction
Sometimes there may be a mistake in any order passed by the Assessing Officer. In such a situation, mistake which is apparent from the record can be rectified under section 154. The provisions relating to rectification of mistake under section 154 are discussed in this part.
Order which can be rectified under section 154
With a view to rectifying any mistake apparent from the record, an income-tax authority may, –
a) Amend any order passed under any provisions of the Income-tax Act.
b) Amend any intimation or deemed intimation sent under section 143(1).
c) Amend any intimation sent under section 200A(1) [section 200A deals with processing of statements of tax deducted at source i.e. TDS return].
d) amend any intimation under section 206CB.
(*) Under section 200A, a TDS statement is processed after making correction of any arithmetical error in the statement or after correcting an incorrect claim, apparent from any information in the statement
Similarly a new section 206CB is inserted by Finance Act, 2015 to provide for the processing of TCS statement.
If due to rectification of mistake, the tax liability of the taxpayer is enhanced or refund is reduced, the taxpayer shall be given an opportunity of being heard.
Rectification of order which is subject to appeal or revision
If an order is the subject-matter of any appeal or revision, any matter which is decided in such an appeal or revision cannot be rectified by the Assessing Officer. In other words, if an order is subject matter of any appeal, then the Assessing Officer can rectify only those matters which are not decided in such appeal.
Initiation of rectification by whom
The income-tax authority can rectify the mistake on its own motion.
The taxpayer can intimate the mistake to the income-tax authority by making an application to rectify the mistake.
If the order is passed by the Commissioner (Appeals), then the Commissioner (Appeals) can rectify mistake which has been brought to notice by the Assessing Officer or by the taxpayer.
Time-limit for rectification
No order of rectification can be passed after the expiry of 4 years from the end of the financial year in which order sought to be rectified was passed. The period of 4 years is from the date of order sought to be rectified and not 4 years from original order. Hence, if an order is revised, set aside, etc., then the period of 4 years will be counted from the date of such fresh order and not from the date of original order.
In case an application for rectification is made by the taxpayer, the authority shall amend the order or refuse to allow the claim within 6 months from the end of the month in which the application is received by the authority.
The procedure to be followed for making an application of rectification
Before making any rectification application the taxpayer should keep following points in mind.
I received 7th pay commission arrears in AY 20-21 pertaining to AY 16-17 and AY 17-18. I claimed relief u/s 89 and submitted form 10E also. However CPC Bengaluru passed an order without considering tax relief u/s 89. Can I submit rectification request for the same?
mistake has been done while filing advance tax for AY2019-20, wrong pan mentioned, we have corrected with AO and its showing in FORM 26AS but for AY 2019-20, return cant be revised please help me how can i claim this amount of income tax refund
What if we fails to reply intimation u/s 154 within time limit of 4 years.
my pan card number AINPS 1414N was wrongly showed in IT Return for AY 2020-21 submitted online as AJNPS1414N.How can it be rectified.pl clarify
In tax returns by mistake I had filled the table for TCS instead of TDS.
Income tax department raised demand for payment.
In response to my rectification request they have rejected it saying that this can not be entertained as it involves reduction in tax liability.
Hi,
I have received SMS/e-mail from income tax department saying rectification return for PAN: xxxx for AY 2018-19 and ACK No.xxxx has been processed at CPC. In the attachment, “net amount payable” is mentioned as Rs. 3000/-. I didn’t file for any rectification. Does this mean I have to pay this extra amount now?
Thanks.
Shamika
Its same with me.
The procedure is OK. But what to do if the Rectification order continues to show the same mistake. In my case the Intimation Under Section 141 has not taken into account the TDS paid by me. The TDS is appearing in form 26AS. I have checked the return, there is no error in filling the ITR. TDS is shown correctly with correct TAN nos. which match with form 26AS. I had filed a rectification request through e-filing portal. Despite apparent error I have received an order u/s 154 keeping the position unchanged raising a demand instead of Tax Refund due to me. What is the next step to get the order rectified.
you can file appeal to commisioner of income tax with
facts of thhe case