Rectification of mistake u/s 154

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Querist : Anonymous

Querist : Anonymous (Querist)

18 October 2013 Asst.Year: 2010-11:- TDS amounting to Rs. 495000/- ,by mistakely, claimed as TCS of Rs. 495000/-. Infact , there was no TCS.We claimed a refund of Rs 4,00,000/-Approx.

While processing the ROI, since there was no TDS claimed by us , the CPC has raised a Demand of Rs 1,20,000/- by processing the ROI.

Subsequently, For Asst.Year 2011-12, there was a refund of Rs 230000/-. CPC has after adjusting the demand of Rs. 120000/- of Asst.Year 2010-11, released balance of Rs 110000/-.

Can any body clarify how to make rectification U/s 154 ? For Asst.Year 2010-11 alone? or For Both the years 2010-11 and 2011-12?

TKKKKKK

TKKKKKK (Expert)
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18 October 2013 According to my view. do rectification for both year. still wait for other expert's view.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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20 July 2025 Great question! Here’s a detailed approach for rectification under section 154 of the Income Tax Act in your case:

Situation Recap:
AY 2010-11: TDS of Rs. 4,95,000 was wrongly claimed as TCS. No TDS was actually claimed → demand of Rs. 1,20,000 raised by CPC.
AY 2011-12: Refund of Rs. 2,30,000. CPC adjusted Rs. 1,20,000 demand from 2010-11 against this refund and released balance Rs. 1,10,000.
How to file rectification u/s 154?
Primary Rectification Year:
The mistake (wrong claim of TCS instead of TDS) relates to AY 2010-11, so the rectification application must primarily be filed for AY 2010-11.
Addressing Related Adjustment in AY 2011-12:
Since CPC adjusted the demand from AY 2010-11 against the refund of AY 2011-12, the rectification for AY 2010-11 will automatically impact AY 2011-12 adjustments once processed.
Recommended Approach:
File rectification u/s 154 for AY 2010-11, explaining the error — the TDS was wrongly claimed as TCS. Attach supporting documents like TDS certificates, Form 26AS, and calculation of correct refund/demand.
Mention in the rectification letter about the adjustment of demand from AY 2010-11 against AY 2011-12 refund and request the department to consider the same while rectifying the mistake.
Do you need to file rectification for AY 2011-12 separately?
Usually, no separate rectification is needed for AY 2011-12 because the correction in AY 2010-11 will cascade through the system once the rectification is accepted. But monitor the status carefully, and if refund is delayed or incorrect for AY 2011-12 post rectification, then you may consider filing a rectification or grievance for AY 2011-12.
Summary:
File rectification under section 154 for AY 2010-11 only.
Clearly state the facts and effects on AY 2011-12 adjustment.
Attach all supporting proofs.
Keep track of CPC processing and communicate further if AY 2011-12 refund remains unresolved after rectification.

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