Rectification under section 154 is limited to apparent mistakes; it cannot reopen facts or claim full exemption without clear record support.

Rectification under section 154 of the Income-tax Act is confined to a mistake apparent from the record and cannot be used for review, reassessment, or fresh inquiry into disputed facts. A later Supreme Court decision may be relied on in rectification, but only where the error is self-evident on the existing record. Here, the return, computation and TDS material did not clearly show that the interest was received under section 28 of the Land Acquisition Act, 1894, and deciding whether the entire receipt was exempt under section 10(37) would require factual examination beyond section 154. Rectification was therefore not permissible and the rejection of the application was upheld.

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Issues: Whether rectification under section 154 of the Income-tax Act, 1961 could be invoked on the basis of the subsequent decision in Ghanshyam (HUF) to substitute the interest returned by the assessee and to treat the entire receipt as exempt.

Analysis: Rectification under section 154 lies only where there is a mistake apparent from the record. The power does not extend to review, reassessment, or fresh investigation of foundational facts. Although a subsequent judgment of the Supreme Court may be applied in rectification proceedings, the mistake sought to be corrected must be self-evident from the existing record. In the present case, the return, computation, and TDS material did not that the interest was shown as received under section 28 of the Land Acquisition Act, 1894, and the claim for full exemption under section 10(37) of the Income-tax Act, 1961 would itself require factual examination beyond the scope of section 154.

Conclusion: Rectification was not permissible and the rejection of the application was upheld.

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