Non-adjudication of argued grounds can justify rectification under section 254(2) and recall for fresh adjudication.

Non-adjudication of the assessee's additional grounds challenging the validity of a section 148 notice constituted a mistake apparent from the record, because the earlier order had proceeded on a different issue without deciding the grounds actually argued. On that basis, rectification under section 254(2) was treated as maintainable, and the prior order was liable to be recalled for fresh consideration of Additional Grounds No. 2 and 3.

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Issues: Whether the Tribunal's earlier order required rectification under section 254(2) of the Income-tax Act, 1961 on the ground that the specific additional grounds argued by the assessee had not been adjudicated.

Analysis: The record showed that the assessee had confined its submissions to the additional grounds challenging the validity of the notice under section 148 of the Income-tax Act, 1961, but no finding had been rendered on that issue in the earlier order. The earlier disposal had proceeded on a different issue on which no submissions had been made, creating a mistake apparent from the record. Such non-adjudication of the grounds actually argued was held to justify rectification under section 254(2).

Conclusion: The Tribunal held that the miscellaneous application was maintainable and that the earlier order was liable to be recalled for fresh adjudication of Additional Grounds No. 2 and 3.

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