Rectification for apparent mistake cannot rely on a later ruling where the issue remained debatable and pending before the Supreme Court.

Rectification under the mistake-apparent-from-record provision is limited to patent, obvious errors and cannot be used for issues requiring detailed reasoning or capable of two views. Here, the Tribunal's original appellate order could not be treated as erroneous merely because a later High Court decision in the assessee's own case took a different view on exemption under section 80P(2)(a)(i). At the time of the original order, that later decision was not on record and the issue was already pending before the Supreme Court, so the question remained debatable. The Tribunal was therefore not justified in invoking section 254(2), and the reference was answered against the Revenue and in favour of the assessee.

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Issues: Whether the Tribunal was justified in rectifying its appellate order under section 254(2) on the ground that, in view of the later High Court decision in the assessee's own case for an earlier year, there was a mistake apparent from the record in relation to exemption under section 80P(2)(a)(i).

Analysis: A mistake apparent from the record must be an obvious and patent error, not one that can be established only by a long-drawn process of reasoning or on a point reasonably capable of two views. When the Tribunal passed its original appellate order, the later High Court decision was not on record, and the same issue was already pending consideration before the Supreme Court. The Tribunal had consistently taken one view for earlier years, and the subsequent contrary High Court view did not retrospectively convert the original order into one containing an apparent mistake. The point therefore remained debatable and was not amenable to rectification under section 254(2).

Conclusion: The Tribunal was not legally correct in holding that there was a mistake apparent from the record; the reference was answered against the Revenue and in favour of the assessee.

Ratio Decidendi: Rectification under the provision for mistakes apparent from the record is permissible only for patent, obvious errors and not for issues that are debatable or require extended reasoning, especially where the legal question is pending final resolution before a higher court.

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