Rectification under Section 154 cannot be used to revisit merits and withdraw investment allowance set-off based on a later decision.

Section 154 of the Income-tax Act permits only rectification of an obvious mistake apparent from the record. Using a later Supreme Court decision to withdraw the set-off of unabsorbed investment allowance required a fresh examination of the merits, not a simple correction of an apparent error. That kind of review exceeds the limited rectification jurisdiction under section 154, so the withdrawal was treated as impermissible and the Revenue's challenge failed.

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Issues: Whether the Assessing Officer could invoke section 154 of the Income-tax Act, 1961 to withdraw the set-off of unabsorbed investment allowance on the basis of a later Supreme Court decision, and whether such action amounted to rectification of a mistake apparent from the record.

Analysis: Section 154 permits only rectification of an obvious mistake apparent from the record. The attempt to reopen the assessment by relying on a Supreme Court judgment involved taking a fresh view on the merits and was not confined to correcting an apparent error. Such an exercise went beyond the limited rectification jurisdiction under section 154.

Conclusion: The rectification was not permissible under section 154 and the Revenue's petition failed.

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