Rectification under section 254(2) cannot be used to seek review or rehearing on section 54F merits.

Section 254(2) permits only rectification of mistakes apparent from the record and does not extend to review or rehearing. A request to recall the entire Tribunal order would require fresh adjudication on merits, which is outside that limited jurisdiction. The Tribunal also noted that its earlier order had already examined the facts and denied section 54F relief because the sale proceeds were not used to buy the house and the investment was largely from borrowed funds. The miscellaneous application was therefore not maintainable and was dismissed.

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Issues: Whether the miscellaneous application seeking recall/rectification of the Tribunal's earlier order was maintainable on the ground of an alleged mistake apparent from the record in relation to the claim under section 54F.

Analysis: The Tribunal held that section 254(2) of the Income-tax Act, 1961 confers only a limited power to rectify mistakes apparent from the record and does not confer any power of review. A request to recall the entire order would necessarily amount to rehearing and re-adjudication on merits, which is beyond the scope of rectification. The earlier order had already considered the facts and concluded that the assessee was not entitled to deduction under section 54F because the sale consideration had not been utilized for purchase of the house and the investment was substantially from borrowed funds. The cited earlier decisions did not justify invoking section 254(2) for a merit-based reconsideration.

Conclusion: The miscellaneous application was not maintainable and was dismissed.

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