Section 254 of ITA, 1961 : Section 254: Orders Of Appellate Tribunal

Explanation using Example

Imagine a business owner, Mrs. Sharma, who has been assessed for income tax by the Income Tax Department. She believes that the assessment is incorrect and has resulted in a higher tax demand than what is actually due. Mrs. Sharma decides to appeal against the assessment to the Income Tax Appellate Tribunal (ITAT).

Under Section 254(1) of the Income-tax Act, 1961, the ITAT hears the arguments from both Mrs. Sharma and the Income Tax Department. After considering the evidence presented, the Tribunal passes an order with the decision it deems fit, which could either be in favor of Mrs. Sharma or the Income Tax Department.

Two months after the order, Mrs. Sharma notices a calculation error in the order that went unnoticed during the hearings. She files an application for rectification under **...

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