Rectification cannot be used to claim land acquisition exemption where statutory applicability is debatable and not a patent record error.

Compensation received for land acquisition under the NHAI enactment was held not to fall within the exemption under section 96 of the land acquisition statute, because the exemption depends on the statutory scheme and the interaction between sections 96 and 105, including the exclusion of Fourth Schedule enactments. That question was treated as debatable rather than a patent error apparent from the record, so it could not be corrected in rectification proceedings under section 154 of the Income-tax Act. The Tribunal followed the jurisdictional view relied on by the first appellate authority and sustained the denial of relief.

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Issues: Whether the assessee's claim that compensation received for land acquisition by NHAI was exempt under section 96 of the land acquisition statute could be entertained in rectification proceedings under section 154 of the Income-tax Act, 1961.

Analysis: The compensation had been included in the return and the rectification application sought exclusion on the footing that the amount was exempt. The issue whether section 96 applied depended on whether the acquisition fell within the statutory scheme excluding enactments listed in the Fourth Schedule and, therefore, required examination of the interaction between section 96 and section 105 of the land acquisition statute. The matter was not an obvious or patent error from the record and was governed by the existing view that acquisitions under the Fourth Schedule enactments do not attract the exemption under section 96. The Tribunal also followed the jurisdictional decision relied on by the first appellate authority.

Conclusion: The claim was not rectifiable under section 154 and the exemption under section 96 was held inapplicable to the compensation received for acquisition under the NHAI enactment.

Final Conclusion: The assessee's challenge to the rejection of rectification failed, and the order denying relief was sustained.

Ratio Decidendi: A claim requiring determination of whether compensation for land acquisition falls within a statutory exemption that is excluded by the governing scheme is a debatable matter and not a mistake apparent from the record for the purpose of rectification.

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