Rectification of mistake

[PRIYAM KHAMBHATA]

Respected Sir,

In Co. A, Income tax assessment order passed on 13.12.2018 and demand raised of Rs.10,00,000/-. Being aggrieved, the same CIT(A) filed. Meanwhile, Co. A had paid Rs.5,00,000/- against demand raised under protest. Subsequently, CIT(A) had decided appeal in favour of Co. A and passed Appellate Order on 09.03.2020. Thereafter, I.T Department had passed Order giving effect to the CIT(A)’s Order on 06.01.2021 with refund receivable of Rs.5,00,000/-. Co. A had already received refund of Rs 5,00,000/- of AY 2016-17. That apart, additionally Rs.5,00,000/- had been adjusted on 04.01.2021 against the Income Tax Refund due of AY 2019-20, by the Income tax Department, which did not know by Co. A. Now, Co. A is made reconciliation with old Income tax Refunds dues in finalization of books for the year ended FY 2024-25 and came to knowledge by Co. A, that Income tax due Refund of Rs.5,00,000/- of AY 2019-20 had been adjusted by the Income tax Department against the due demand of AY 2016-17.

Now, my question is that can file Rectification Application by Co. A, against the Order giving effect to CIT(A)’s order dated 06.01.2021 to get Income tax Refund of Rs.5,00,000/- in respect of unused credits of Income tax refund adjustment of AY 2019-20. Is there time barred for filing Rectification Application under section 154. How can get this refund from Income tax Department by Co. A.

Please guide me

AI Summary

Taxpayer Challenges Unauthorized Tax Refund Adjustment, Seeks Rectification Under Section 154 for Wrongly Offset Demand A company discovered an unauthorized tax refund adjustment by the Income Tax Department during financial reconciliation. The company seeks to file a rectification application under section 154 of the Income Tax Act to recover a Rs. 5,00,000 refund from AY 2019-20, which was incorrectly adjusted against a nullified demand from AY 2016-17. The application can be filed before 31.03.2025, within the four-year time limit from the original order's date.