Question

Section 154 under IT Act is

• A. For filing return of Income
• B. For filing return with late fee
• C. Rectification of mistakes
• D. Appeal against the order passed by the ITO

Hint:

In the Income Tax Act, remember the key procedural sections by their function: 139 (Filing Return), 143 (Scrutiny Assessment), 144 (Best Judgment Assessment), 147/148 (Income Escaping Assessment), and 154 (Rectification).

Answer 1

The Correct Option is C

Step 1: Understanding the Concept:
The question asks about the purpose of Section 154 of the Income Tax Act, 1961. Note: The question mistakenly refers to the "IT Act," which usually means Information Technology Act, but the options clearly relate to the Income Tax Act.

Step 2: Detailed Explanation:
Let's analyze the relevant sections of the Income Tax Act, 1961:
- Section 154 is titled "Rectification of mistake." This section gives the income-tax authority the power to amend any order passed by it to rectify any mistake apparent from the record. This can be done on the authority's own motion or when a mistake is brought to its notice by the assessee. This perfectly matches option (C).
- (A) For filing return of Income: This is primarily dealt with under Section 139.
- (B) For filing return with late fee: The consequences of late filing, including fees, are covered under sections like 234F.
- (D) Appeal against the order passed by the ITO: Appeals are dealt with in a separate chapter of the Act, starting from Section 246 (Appeal to the Commissioner (Appeals)).

Step 3: Final Answer:
Section 154 of the Income Tax Act deals with the rectification of mistakes.