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Sunny Honey (Student)     05 December 2008

Rectification u/s 154 of I.T.Act 1961

An assessee has filed his return of income for the assessment year 2007-08 in which he has claimed the deduction under section 80 IB of Income Tax Act, 1961 which was not legally admissible as a deduction. The return was processed under section 143(1) of the Income Tax Act, 1961. Is the A.O. empowered to invoke the provision of section 154 of the Income Tax Act, 1961 suo moto for disallowing the deduction claimed by the assessee wrongly in his return of income for the captioned year ?


 3 Replies


There may be some possiblity of that if particular assessee may fall in the list of scrutiny. As far as the concern of suo moto to be take by assessing officer to disallowing the deduction which availed by the Assessee, there is not any possiblity due to having very large nuber of Tax-payer



A V Vishal (Advocate)     26 January 2009

The A O cannot proceed suo moto u/s 154

Ashish M (Chartered Accountant)     02 February 2009

Sec.154 provides that the A.O. can make order under this section on its own motion within four yrs.........Sec.154(2)(b), & (7).....

since sec.154 covers not only an order but also any intimation. hence even if the return did fall under the scrutiny in the relevant yr. and was accepted, the power to amend deemed intimation can be applicable in ur case and the A.O. can very well disallow the deduction. ....

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