Rectify mistake made in Revised Income tax return file.

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If you've made a mistake in your revised Income Tax Return (ITR), particularly with depreciation calculations for FY 2017-18, you can file a rectification application under Section 154. This process allows you to correct errors apparent from the record. Additionally, if you receive a notice under Section 245 proposing to adjust your FY 2018-19 refund against a previous demand, you should respond by explaining the ongoing rectification process and request a stay on the adjustment until the matter is resolved.

Kartik

Kartik (Querist)
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25 September 2020 Dear Sir,

I have made mistake in calculating depreciation while filing with revised ITR for FY 2017-18. and I have intimation u/s 143(1) in which incorrect depreciation is disallowed on 22/05/2019.
I come to notice this while I got notice u/s 245 for proposed adjustment of refund due for FY 2018-19 on 18/09/2020
Kindly guide me how can I rectified FY 2017-18 return and how to stop proposed adjustment in FY 2018-19 against refund.

CA Raj Doshi

CA Raj Doshi (Expert)
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26 September 2020 File Rectification u/s 154 for FY 2017-18 with correct particulars.

Kartik

Kartik (Querist)
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26 September 2020 Dear Sir,

Thanks for the reply, can you help me with detail procedure and what to be done for notice received u/s 245 for FY 2018-19 for proposed adjustment of previous demand (FY 2017-18).

Thanks in advance

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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20 July 2025 Got it! Here’s how you can handle both issues step-by-step:

1. Rectification of mistake in FY 2017-18 (Revised Return) — Disallowed Depreciation
Since you already filed a revised return but made a mistake in depreciation and the department disallowed it in intimation u/s 143(1), you need to:

File a Rectification application under Section 154 for AY 2018-19 (FY 2017-18).
Rectification u/s 154 allows correction of any “mistake apparent from record” such as wrongly disallowed depreciation.
Procedure:

Log in to the Income Tax e-filing portal.
Go to Rectification -> Submit Rectification Request.
Select the AY 2018-19.
Choose the Intimation/Assessment order you want to rectify (the one dated 22/05/2019).
Clearly mention that depreciation was wrongly disallowed and provide the correct depreciation amount.
Attach supporting documents (calculation sheet, revised depreciation schedules).
Submit the application.
2. Regarding Notice u/s 245 for FY 2018-19 — Proposed Adjustment
Section 245 notice means the department wants to adjust your refund of FY 2018-19 against pending demand from FY 2017-18.

What to do?

File a response to the notice explaining that the demand for FY 2017-18 is under dispute due to the mistake in depreciation and you have filed (or will file) a rectification application.
You can request the department to stay the adjustment till the rectification is decided.
If the adjustment proceeds, you may lose the refund temporarily, but if rectification succeeds, you can claim the refund again.

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