ITAT Mumbai Dismisses Appeal Challenging Rectification Order Under Section 154

Assessee’s Absence and Limited Scope of Appeal Prove Decisive

The Mumbai “SMC” Bench of the Income Tax Appellate Tribunal dismissed the appeal filed by Santilal Beni Gupta for Assessment Year 2017–18, upholding the order passed by the National Faceless Appeal Centre under Section 250 of the Income Tax Act. The assessee had challenged an addition of ₹10 lakh under Section 69A, alleging unexplained income. However, when the matter came up for hearing, no one appeared on behalf of the assessee despite repeated calls. The Tribunal noted a consistent pattern of adjournments in earlier hearings, followed by continued non-appearance. In contrast, the Revenue was fully prepared to proceed, prompting the Bench to hear the matter ex parte.

Tribunal Finds No Error in CIT(A)’s Reasoning

On examining the record, the Tribunal observed that the appeal before the Commissioner (Appeals) arose from an order passed under Section 154, which merely corrected a tax computation error in accordance with law. Crucially, the assessee had not challenged the substantive additions made in the original assessment proceedings. The Bench held that since the rectification order dealt only with arithmetical correction and not the merits of the assessment, the appeal itself was not maintainable. The CIT(A) had therefore rightly dismissed it. Finding no legal infirmity or procedural lapse, the Tribunal declined to interfere with the lower authority’s decision.

Accordingly, the appeal was dismissed in full, reinforcing that rectification proceedings cannot be used as a backdoor to reopen unchallenged substantive additions.