Rectification under section 254(2) cannot reopen merits where factual verification of employee stay in India was directed.

Under section 254(2) of the Income-tax Act, a rectification application must be confined to an apparent mistake on the record and cannot be used to seek a fresh decision on merits. The Tribunal's direction for factual verification of the assessee's claim that its employees stayed in India for less than 90 days was based on the record showing that the claim had not been independently verified in the original proceedings. As no patent error was shown, the request for rectification was not maintainable.

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Issues: Whether the Tribunal had committed a mistake apparent from the record under section 254(2) of the Income-tax Act, 1961 by directing factual verification of the assessee's claim that its employees had stayed in India for less than 90 days and, consequently, whether the rectification application was maintainable.

Analysis: The record showed that the Assessing Officer had not accepted the assessee's claim regarding the 42-day stay of its employees in India and had concluded that a fixed place permanent establishment existed. The Dispute Resolution Panel also did not record an independent factual finding on the duration of stay. Since the original order had proceeded on the basis that the factual claim had not been verified, the direction to the Assessing Officer to verify that claim did not disclose any apparent mistake. The application, in substance, sought a different decision on merits, which is beyond the scope of rectification under section 254(2) of the Income-tax Act, 1961.

Conclusion: No mistake apparent from the record was established, and the rectification request was not maintainable.

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