Rectification under section 154 cannot enhance interest under section 234C when the assessment already reflects the correct computation.

A rectification under section 154 cannot be used to enhance interest under section 234C where the assessment order already computed the interest correctly. The text states that the lower interest figure matched the assessee's computation sheet and the processing under section 143(3), while the higher figure came only from a system-generated self-computation at return filing. On those facts, there was no apparent mistake in the assessment record capable of rectification, so the rectification proceedings were wrongly initiated and the enhanced interest demand was held invalid.

---

---

Issues: Whether the rectification order passed under section 154 of the Income-tax Act, 1961, enhancing interest under section 234C was valid when the assessment order had already computed the interest correctly.

Analysis: The interest payable under section 234C was found to work out correctly at the lower figure as computed by the assessee in the computation sheet and as also reflected in the processing and the assessment under section 143(3) of the Income-tax Act, 1961. The higher amount had arisen from the assessee's system-generated self-computation at the time of filing the return. On these facts, there was no mistake in the assessment order capable of rectification under section 154, and the rectification proceedings were held to have been wrongly initiated.

Conclusion: The rectification order under section 154 and the consequential enhancement of interest under section 234C were invalid and unsustainable; the issue was decided in favour of the assessee.

---