Rectification of mistake apparent from the record permits withdrawal of an exclusion contrary to statutory disclosure conditions.

Section 154 rectification was held permissible where an earlier assessment order excluded income contrary to the statutory conditions of the Voluntary Disclosure of Income and Wealth Act, 1976. The scheme of section 3 applied only to qualifying declarants and qualifying income, while section 8 immunity from inclusion in total income operated only within the limits of that Act. A certificate under section 8(2) was conclusive only for that statutory framework. As the assessee's income and source were already recorded in the books and fell outside the intended class of declarants, the exclusion from assessment was a mistake apparent from the record and could be withdrawn.

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Issues: Whether the Income-tax Officer could invoke section 154 of the Income-tax Act, 1961 to rectify the earlier order and withdraw the exclusion of income declared under section 3(1) of the Voluntary Disclosure of Income and Wealth Act, 1976.

Analysis: The statutory scheme of the Voluntary Disclosure of Income and Wealth Act, 1976 was held to be clear. Section 3 applied only to qualifying declarants and qualifying income, section 8 granted immunity from inclusion in total income only subject to the statutory conditions, and the certificate issued under section 8(2) was conclusive only within the confines of that Act. On a plain reading of the provisions, persons whose income and source were already reflected in books and were otherwise outside the intended class of declarants could not claim the statutory benefit. The earlier order excluding the income from assessment was therefore contrary to the statute and amounted to a mistake apparent from the record, making rectification under section 154 permissible.

Conclusion: The Income-tax Officer was competent to invoke section 154 and the rectification was valid, in favour of the Revenue and against the assessees.

Ratio Decidendi: Where the legal position is clear on the face of the statutory provisions, an order granting an exclusion contrary to the statute constitutes a mistake apparent from the record and may be rectified under section 154 of the Income-tax Act, 1961.

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