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Facts
The assessee filed an appeal against the order of the National Faceless Appeal Centre (NFAC) which was based on an earlier assessment order. The CIT(A) initially passed an order setting aside the assessment order, but subsequently passed a rectification order under Section 154, which dismissed the assessee's appeal.
Held
The Tribunal held that the rectification order passed by the CIT(A) under Section 154 was unjustified as it went beyond the scope of rectification and amounted to a change of decision. The rectification order was quashed.
Key Issues
Whether the CIT(A) correctly exercised its powers under Section 154 to modify an earlier appellate order, and if not, what is the consequence.
Sections Cited
250, 144, 147, 251(1)(a), 154
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Income Tax Appellate Tribunal, JODHPUR BENCH, JODHPUR
Before: DR. MITHA LAL MEENA, HON’BLE & SHRI ANIKESH BANERJEE, HON’BLE
Ashok Kumar vs ITO, Ward-1, Churu, C/o R.S. Poonia, D-82B, Siwad Rajasthan Area, Krishna Marg, Bapu Nagar, Jaipur-302 015 PAN: FESPK3689J APPELLANT RESPONDENT Present for Assessee ShriR.S. Poonia, CA Present for Revenue Shri Brij Lal Meena, Addl.CIT-DR Date of hearing 20/08/2025 Date of pronouncement 21/08/2025 O R D E R Per Bench: The instant appeal of the assessee was filed against the order of theNational Faceless Appeal Centre (NFAC), Delhi [for brevity, ‘Ld.CIT(A)’]order passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’),for A.Y. 2016-17, date of order 05/12/2024. The impugned order was emanated from the order of the Ld.ITO, Ward-1, Churu, passed under section 144/147, date of order 18/12/2018.
We have heard the rival submissions and perused the material available on record. The Ld. AR contended that the Ld. CIT(A) had passed an order under section 250 of the Act on 29/11/2024, setting aside the impugned assessment 2 ITA 14/Jodh/2025 Ashok Kumar order which had been passed under sections 144/147 of the Act on 18/12/2018, by exercising powers conferred under section 251(1)(a) of the Act. Subsequently, however, the Ld. CIT(A) passed another order dated 05/12/2024 under section 154 read with section 250 of the Act, whereby he purported to amend the earlier appellate order dated 29/11/2024, and in doing so, dismissed the appeal of the assessee. The Ld. AR submitted that such action of the Ld. CIT(A) amounts to a change of decision under the garb of rectification, which is not permissible under section 154 of the Act. It was argued that rectification under section 154 can only be resorted to for correction of a mistake apparent from the record, and not for review or alteration of a concluded decision.
On consideration, we find merit in the contention of the Ld. AR. The rectification order passed under section 154 r.w.s. 250 is wholly unjustified, as it travels beyond the limited scope of rectification contemplated by law. The Ld. DR did not raise any serious objection to the observations of the Bench. Accordingly, we quash the rectification order dated 05/12/2024 passed by the Ld. CIT(A). Consequently, the impugned assessment order is set aside to the file of the Ld. AO for adjudication de novo. Since the issue was purely legal in nature, and the Ld. AR did not advance any argument on merits, we refrain from expressing any opinion on the merits of the case. Needless to say, in the set-aside proceedings, the assessee shall be afforded reasonable opportunity of being heard. Correspondingly, the assessee is expected to remain diligent and cooperative in the fresh assessment proceedings.