Rectification under section 254(2) is limited to apparent errors, not merits review of Tribunal findings on evidence.

Rectification under section 254(2) of the Income-tax Act, 1961 is limited to mistakes apparent from the record and cannot be used to seek rehearing on merits or review of a reasoned finding. The Tribunal had confirmed the addition on the FDR issue on the basis of several factors, including the absence of supporting evidence. As the challenge required reconsideration of material and reappreciation of the merits, no apparent error on the face of the record was shown. The rectification application was therefore not maintainable, and the appeal failed.

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Issues: Whether the Tribunal's order confirming the addition of Rs. 5,500 could be rectified under section 254(2) of the Income-tax Act, 1961 on the ground of an apparent error on the face of the record.

Analysis: Rectification under section 254(2) is confined to mistakes that are manifest from the record and does not permit a rehearing on merits or a review of the conclusion reached. The Tribunal's finding on the FDR was based on several factors, including the absence of supporting evidence, and not on a single isolated circumstance. Since the challenge required reappreciation of material and reconsideration of the merits, the matter lay outside the narrow ambit of rectification proceedings.

Conclusion: The application did not disclose any error apparent on the face of the record and was not maintainable under section 254(2) of the Income-tax Act, 1961. The appeal failed.

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