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In some cases, it may so happen that an order containing mistakes is passed by the assessing officer. Section 154 provides an opportunity for the assessing officer to rectify any mistake or error that was done by him. It allows the officer to correct mistakes done by him. It also provides relief to the taxpayer from the tedious process of getting his accounts assessed once again.
Income Tax Act provides for rectification of mistakes under Section 154. It is a rectification of mistake apparent from records. Orders issued under Sections 143(1), 200A (1) and 206CB (1) can be rectified. However, only those mistakes can be rectified that are apparent from the record. Section 143(1) deals with summary assessment; it is a notice issued post-filing of return. Section 200A (1) and 206CB (1) deal with intimations issued for error in TDS and TCS statements. This rectification of mistakes shall be done only after a return has been filed by the assessee; such return has been processed and an intimation is received by the taxpayer and such intimation has errors or mistake.
Rectification request shall be allowed by the tax authorities only if the mistake is made apparent from record. The errors that can be rectified are:
The examples of the above mistakes or errors are:
Rectification request shall not be issued for change in details regarding bank account or address in the income tax account of the taxpayer.
Whether a mistake apparent from record can be rectified?
Yes, mistake apparent from the record can be rectified.
Under which section can an error be rectified?
Errors can be rectified under section 154 of the Income Tax Act.
What is a rectification request?
As per the provisions of section 154(1) of the income tax act, a rectification is permissible by the Income Tax Department for amending any errors when there is an apparent error in the Income Tax Return filed by you.
Can an order be rectified if it is a part of the subject matter of appeal?
Any order which is a subject matter of appeal or revision cannot be rectified.
Can Income-tax authority rectify its order on its own?
Yes, Income Tax authority has the power to rectify its own order.
Who can apply for rectification of order?
Any taxpayer in case of whom an order containing error has been passed shall apply for rectification apart from tax authorities on suo moto basis.
What is the time limit to rectify an order if the application is made by the taxpayer?
The time limit for rectification of order, if the application has been made by taxpayer, shall be six months from the end of the month in which such application is received by the officer.
Can an online application be filed for rectification of mistake?
Yes, an option to file for online application is provided to the taxpayer. Online rectification procedure is easy to understand and execute, it is time-saving.
What is the procedure if rectification order has an effect of enhancing assessment, reducing the refund or increasing liability?
If an assessment order has the above-mentioned effects, then an opportunity of being heard shall be given to the taxpayer before passing such an order.
How to file online rectification?
A. Taxpayer Correcting Data for Tax Credit mismatch only. Tax credit shall relate to Tax Deducted at Source, Tax Collected at Source or Income tax. Under this, tax payer can add a maximum of ten entries for each of the above mentioned taxes.
B. Taxpayer is amending the Data in Rectification. Under this option, select the reason for rectification by checking against the box in front of the box. A maximum of four reasons can be selected and XML has to be uploaded.
List of Reasons available under this option are:
C. No further Data Correction required. Reprocess the case. This option shall be selected if there is a tax credit mismatch or interest mismatch. Here, uploading of income tax return is not required. The tax payer shall select the checkbox for which reprocessing has to be done.
Whether appeal can be filed against order rectified under section 154?
Yes, appeal can be filed to higher authorities against order rectified under section 154.
Whether rectification of an order passed u/s 154 is valid due to subsequent change of law on retrospective basis?
If the assessment order is inconsistent with a specific provision as amended retrospectively, then undisputedly there is a mistake which is apparent on the record. In the light of the amended provision in retrospective effect, the assessment order as passed by the tax office will have to be revised. Therefore, in view of this, the assessing officer shall rectify order of assessment as per the later amendment of the law with retrospective effect.