Yes, under s.154, if the mistake is apparent from the record — obvious and patent, not something needing a long chain of reasoning. The order can be rectified within four years from the end of the financial year in which it was passed, and where you apply, the officer must dispose of the application within six months from the end of the month in which he receives it.
What can be rectified. Any order passed under any provision of the Act, any intimation or deemed intimation under s.143(1), any intimation under s.200A(1) on a TDS statement, and any intimation under s.206CB on a TCS statement.
What 'apparent from the record' means. The Supreme Court in T.S. Balaram, ITO v. Volkart Bros held that a mistake apparent on the record must be an obvious and patent mistake and not something which has to be established by a long drawn process of reasoning on points on which there may conceivably be two opinions. A decision on a debatable point of law is not a mistake apparent from the record.
So s.154 will carry a wrong TDS credit, a wrong figure of advance tax, a plain arithmetical error, a failure to give effect to a relief already allowed, a figure carried from the wrong year. It will not carry a change of opinion, a fresh legal argument, or a claim that needs investigation of new facts.
Who can do it, and on whose initiative. The income-tax authority may rectify on its own motion; you may apply; and the JCIT(A) or CIT(A) may rectify an order passed by them, on a point brought up by the AO or by you.
Time limit. No rectification order can be passed after four years from the end of the financial year in which the order sought to be rectified was passed. The four years run from the order actually being rectified, not necessarily from the original assessment — so a rectified order restarts the clock as to itself.
The officer's duty on an application. Where you make an application, the authority must, within six months from the end of the month in which the application is received, either amend the order or refuse to allow the claim. Silence is not an option the statute contemplates.
Protection. Where the rectification has the effect of enhancing the assessment or reducing a refund, notice and a reasonable opportunity of being heard must be given. And a matter already considered and decided in an appeal or revision cannot be reopened by rectification. An order under s.154 that enhances the assessment or reduces a refund, and an order refusing a s.154 claim, are themselves appealable under s.246A.
Most notices that shock a taxpayer are not additions at all — they are unmatched TDS, an ignored challan, or a wrongly computed interest figure in an intimation. Rectification is faster and cheaper than an appeal and does not put your assessment at risk of enhancement. But the four-year limit is hard, and using s.154 for a debatable point is the commonest way to lose an appeal window.
My return was only processed under 143(1). Does that stop the department reopening it later?
A binding decision that covers my point was never considered when my order was passed. Is that a mistake apparent from the record?
My settlement application was admitted years before the Commission passed its final order — can it charge me section 234B interest for that whole period, and reopen the settled order later to add interest it forgot?
How wide are the first appellate authority's powers when it disposes of an appeal?
The Assessing Officer computed interest under s.234B and s.234C first and only then gave me credit for MAT under s.115JAA. My refund has turned into a demand. Is that the right order?
An amendment adds a new levy. Does it reach back to earlier years?
Your appeal is late. How strictly will 'sufficient cause' be read?
My return was only processed under section 143(1) and now the officer wants to reopen it. Can I say he is changing his opinion?
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