SUDNDARAM RAJASUNDARAM,CHENNAI vs. ACIT CENTRAL CIRCLE 2(3), CHENNAI

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ITA 3932/CHNY/2025Status: DisposedITAT Chennai24 July 2026AY 2014-155 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the AO was empowered under Section 154 to rectify mistakes apparent from the record, including the charging of mandatory interest. The Tribunal found that the AO had followed the due legal process and confirmed the orders of the lower authorities.

What were the facts?

The assessee filed a return of income, which was accepted. Subsequently, the Assessing Officer (AO) issued a notice under Section 154 to rectify a short levy of interest under Sections 234A and 234B. The assessee's appeal against this rectification order was dismissed by the CIT(A).

What were the issues?

Whether the AO can rectify a short levy of mandatory interest under Section 154, and if the rectification order was validly passed without a DIN.

Which sections of the Income-tax Act were involved?

Section 154,Section 234A,Section 234B,Section 143(3),Section 153A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH: CHENNAI

Before: HONOURABLE GEORGE GEORGE K & SHRI GAGAN GOYAL

Hearing: 23.06.2026Pronounced: 24.07.2026

आयकर अपीलीय अधिकरण ‘बी’ न्यायपीठ, चेन्नई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH: CHENNAI माननीय श्री जॉजज जॉजज के.,उपाध्यक्ष एवं श्री गगन गोयल लेखा सदस्य के समक्ष BEFORE HONOURABLE GEORGE GEORGE K, VICE PRESIDENT AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER आयकर अपील सं./ITA No. 3932/Chny/2025 ननिाजरण वर्ज /Assessment Years: 2014-15 Sundaram Rajasundaram v. Deputy Commissioner of No. G 02, Akshaya Level Up, Income Tax, No.53/54, Sterling Road, Central Circle-2(3), Nungambakkam, Chennai-600 034. Chennai. [PAN: AEOPR1964C] (अपीलार्थी/Appellant) (प्रत्यर्थी/Respondent) अपीलार्थी की ओर से/ Assessee by : Mr. T. Vasudevan, Advocate, Ld. AR प्रत्यर्थी की ओर से /Revenue by : Mr. Shiva Srinivas, CIT, Ld. DR सुनवाईकीतारीख/Date of Hearing : 23.06.2026 घोषणाकीतारीख /Date of Pronouncement : 24.07.2026 आदेश / O R D E R PER GAGAN GOYAL, AM: This is an appeal preferred by the assessee against the order of Ld. Commissioner of Income Tax (A) (hereinafter referred as the ‘Ld. CIT(A)’), Chennai- 19, dated 28.10.2025, for the Assessment Year (hereinafter referred as the ‘AY’) 2014-15.

GROUNDS OF APPEAL 1. The order of the Ld. Commissioner of Income Tax (Appeals) dismissing the appeal is contrary to law, erroneous and unsustainable on the facts of the case. 2. The Ld.CIT (A) erred in upholding the order of the assessing officer passed under section 154 dated 30.10.2019 reworking the levy of interests under section 234A and 234B of the Act.

ITA No.3932/Chny/2025 (2014-15) Sundaram Rajasundaram 3. The Ld. CIT (A) failed to appreciate that the levy of interests u/s. 234A and 234B was considered in the earlier order u/s.154 passed on 31.3.2018 and hence there is no mistake apparent warranting rectification of the order.

4.

The Ld. CIT (A) further failed to appreciate that the interests were charged as per law in the order u/s.154 dated 31.3.2018 and refund determined correctly and hence out to have cancelled the impugned order u/s. 154.

5.

The Ld. CIT (A) further failed to appreciate that interest was charged upto the date of the passing of the order u/s. 143(3) r.w.s. 153A of the Act, while accepting the income returned by assessee and hence the present proceedings of the officer u/s. 154 is invalid and untenable in law.

6.

The Ld. CIT (A) erred in upholding the order u/s. 154 dated 30.10.2019 passed without generating a valid DIN as it is not in accordance with the provisions of the Act and the Board Circular No.19/2019 dated 14.08.2019.

7.

The Ld. CIT (A) having accepted that the order dated 31.10.2019 does not contain DIN, ought to have held it to be invalid and thus allowed the appeal.

2.

The brief facts of the case are that the assessee an individual filed his return of income u/s. 153A of the Act on 14.12.2017 declaring total income at Rs. 3,19,70,710/-. The return of the assessee was duly accepted u/s. 143(3) r.w.s. 153A of the Act vide order dated: 31.12.2017 and a demand of Rs. 6,34,497/- was raised, against which the assessee filed an application u/s. 154 of the Act and a refund of Rs. 15,53,850/- was sanctioned. On 30.08.2019 the AO issued a notice u/s. 154 of the Act stating therein that a short levy of interest under section 234A and 234B of the Act was there in the assessment order itself passed vide dated: 31.12.2017.

3.

This resulted in a further order of the AO u/s. 154 of the Act vide dated: 29.10.2019. The assessee being aggrieved with the same preferred an appeal before the Ld. CIT (A), who in turn dismissed the appeal of the assessee. We have gone through the order of the AO passed u/s. 154 of the Act, order of the Ld. CIT (A) and submissions of the assessee along with grounds taken before us. It is observed that as far as the calculation part is concerned, the assessee is not in appeal before us. The assessee’s only grievance was the action of the AO, when he passed order

ITA No.3932/Chny/2025 (2014-15) Sundaram Rajasundaram u/s. 154 of the Act vide dated: 29.10.2019. For a better appreciation of the matter, we deem it fit to reproduce herein below the provisions of section 154 of the Act as under: Rectification of mistake. 154. (1) With a view to rectifying any mistake apparent from the record an income-tax authority referred to in section 116 may, — (a) amend any order passed by it under the provisions of this Act; (b) amend any intimation or deemed intimation under sub-section (1) of section 143; (c) amend any intimation under sub-section (1) of section 200A; (d) Amend any intimation under sub-section (1) of section 206CB.

(1A) Where any matter has been considered and decided in any proceeding by way of appeal or revision relating to an order referred to in sub-section (1), the authority passing such order may, notwithstanding anything contained in any law for the time being in force, amend the order under that sub-section in relation to any matter other than the matter which has been so considered and decided. (2) Subject to the other provisions of this section, the authority concerned— (a) may make an amendment under sub-section (1) of its own motion, and (b) Shall make such amendment for rectifying any such mistake which has been brought to its notice by the assessee or by the deductor or by the collector, and where the authority concerned is the Joint Commissioner (Appeals) or the Commissioner (Appeals), by the Assessing Officer also.

(3) An amendment, which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee or the deductor or the collector, shall not be made under this section unless the authority concerned has given notice to the assessee or the deductor or the collector of its intention so to do and has allowed the assessee or the deductor or the collector a reasonable opportunity of being heard. (4) Where an amendment is made under this section, an order shall be passed in writing by the income-tax authority concerned. (5) Where any such amendment has the effect of reducing the assessment or otherwise reducing the liability of the assessee or the deductor or the collector, the Assessing Officer shall make any refund which may be due to such assessee or the deductor or the collector. (6) Where any such amendment has the effect of enhancing the assessment or reducing a refund already made or otherwise increasing the liability of the assessee or the deductor or the collector, the Assessing Officer shall serve on the assessee or the deductor or the collector, as the case may be a notice of demand in the prescribed form specifying the sum payable, and such notice of demand shall be deemed to be issued under section 156 and the provisions of this Act shall apply accordingly. (7) Save as otherwise provided in section 155 or sub-section (4) of section 186 no amendment under this section shall be made after the expiry of four years from the end of the financial year in which the order sought to be amended was passed. (8) Without prejudice to the provisions of sub-section (7), where an application for amendment under this section is made by the assessee or by the deductor or by the collector on or after the 1st day of June 2001 to an income-tax authority referred to in sub-section (1), the authority shall pass an order, within a period of six months from the end of the month in which the application is received by it, — (a) making the amendment; or

ITA No.3932/Chny/2025 (2014-15) Sundaram Rajasundaram (b) Refusing to allow the claim.

4.

The action of the AO has been examined in the light of the provisions of section 154(1) (a), 154(2) (a), 154 (3) and 154 (6) as reproduced (supra). It is observed that prima-facie all the conditions are being fulfilled by the AO, while passing order u/s. 154 of the Act. Moreover, the section duly authorizes the AO in the situation before us to pass such an order. The order passed by the ITO under section 143(3) r.w.s. 153A of the Act could not be said to be final in the literal sense of the word. This order was and continued to be liable to be modified under section 154/263/264 of the Act as the case may be. The words used in the section 154 of the Act are "apparent from the record" and the record does not mean only the order of assessment but it comprises all proceedings on which the assessment order is based and the Income-tax Officer is entitled for the purpose of exercising his jurisdiction under section 154 of the Act to look into the whole evidence and the law applicable to ascertain whether there was an error. If he doubts, it is open to him to check up the previous calculations and if he finds any mistake it is open to him to make fresh calculations in accordance with the law applicable including the rules made thereunder. 5. The powers under section 154 of the Act is no doubt limited to rectification of mistakes which are apparent from the record. A mistake contemplated by this section is not one which is to be discovered as a result of an argument but it is open to the ITO to examine the record including the evidence and if he discovers any mistake he is entitled to rectify the error provided that if the result is enhancement of assessment or reducing the refund then notice has to be given to the assessee and he should be allowed a reasonable opportunity of being heard. It is observed that this legal course of action has been duly followed by the AO and is not under challenge also. 6. Moreover, charging of mandatory interest u/s. 234A/B/C of the Act can’t be left at the mercy or mistake of either the assessee or assessing authority. Rectification under section 154 of the Act can only be made when glaring mistake of fact or law has been committed by the officer passing the order and it becomes apparent from the record. Rectification is not possible if the question is debatable.

ITA No.3932/Chny/2025 (2014-15) Sundaram Rajasundaram Moreover, the point which is not examined on fact or in law cannot be dealt with as mistake apparent on the record. In the appeal before us, the question of charging mandatory interest is neither debatable nor any length exercise to point out the fact is required, i.e. the same is mistake apparent from record. In view of this, grounds raised by the assessee are dismissed and the orders of the authorities below are confirmed. 7. In the result, the appeal of the assessee is dismissed with above factual and legal observations. Order pronounced on the 24th day of July, 2026, in Chennai.

Sd/- Sd/- (जॉजज जॉजज के.) (गगन गोयल ) (GAGAN GOYAL) (GEORGE GEORGE K) लेखा सदस्य/ACCOUNTANT MEMBER उपाध्यक्ष /VICE PRESIDENT चेन्नई/Chennai, ददनाांक/Dated: 24th July, 2026. KB आदेश की प्रततललपप अग्रेपषत/Copy to: 1. अपीलार्थी/Appellant 2. प्रत्यर्थी/Respondent 3. आयकर आयुक्त/CIT, Chennai /Madurai/Coimbatore/Salem 4. पवभागीय प्रतततनधि/DR 5. गार्ड फाईल/GF

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