Rectification of Mistake under Income Tax Act 2025: Section 287, Time Limit and Section 288 Amendments

Section 287 of the Income-tax Act, 2025 lets a tax authority correct a mistake apparent from the record in its own order or intimation. The taxpayer can ask for it, or the authority can act on its own. The correction must be made within four years from the end of the financial year in which the order was passed, and an application must be decided within six months from the end of the month in which it is received. Section 288 adds a set of specific cases where an assessment can be amended later because a related order or event changed the facts.

This guide covers what can be rectified, who can apply, the notice rule when tax goes up, the time limits, and the eleven situations in the section 288 table. Law is as amended by the Finance Act, 2026, for tax year 2026-27. This is information, not advice on any specific case.

What is rectification of mistake under section 287?

Rectification is a short, low-cost way to fix a plain error without filing an appeal. Under section 287(1), an income-tax authority listed in section 236 (from the Central Board of Direct Taxes down to Inspectors and Tax Recovery Officers) can amend:

• an order passed by it under the Act;
• an intimation or deemed intimation under section 270(1), which is the outcome of processing a return;
• an intimation under section 399, which is the outcome of processing a TDS or TCS statement.

The test is a mistake apparent from the record. The Act does not define the phrase, so the practical reading is an error that can be seen from the order and the documents already on file, such as an arithmetical slip or a TDS credit that appears in the statements but was not given. A point that needs fresh evidence or a debatable view of law is usually a matter for appeal, not rectification.

Under section 287(2), the authority can amend in relation to any matter, other than a matter that was considered and decided in an appeal or revision. So if an appellate authority has already ruled on a point, you cannot reopen that point through section 287.

Who can ask for rectification, and does the officer have to act?

Section 287(3) gives two routes:

• Own motion. The authority may make the amendment itself.
• On being told. The authority shall make the amendment if a mistake is brought to its notice by the assessee, the deductor or the collector. For a Joint Commissioner (Appeals) or Commissioner (Appeals), the Assessing Officer can also bring the mistake to notice.

The word is "shall", so a genuine mistake pointed out by you has to be dealt with. Section 287(9) fixes the clock: the authority must pass an order making the amendment, or refusing the claim, within six months from the end of the month in which your application is received.

What happens if the correction increases my tax?

Rectification can cut both ways. Section 287(4) protects you: no amendment that enhances an assessment, reduces a refund or otherwise increases liability can be made without giving you (a) a notice of the intention to do so and (b) a reasonable opportunity of being heard.

Section 287(5) requires a written order whenever an amendment is made. After that:

• If the amendment reduces the assessment or liability, the Assessing Officer makes the refund due (section 287(6)).
• If it increases the assessment, cuts a refund already made or raises liability, the Assessing Officer serves a notice of demand in the prescribed form, and that notice is treated as issued under section 289 (section 287(7)). The normal recovery provisions then apply.

What is the time limit for rectification?

Item	Rule	Where
Outer limit for an amendment	Four years from the end of the financial year in which the order or intimation was passed	Section 287(8)
Decide your application	Within six months from the end of the month in which the application is received	Section 287(9)
Exception to the four years	Section 288 cases, which count from the time given in column D of its table	Section 287(8), 288(1)

The four-year limit starts from the end of the financial year, not the date of the order. An order passed on 15 July 2026 falls in the financial year ending 31 March 2027, so the four years run to 31 March 2031.

Worked example 1: a TDS credit that was missed

Assumptions (tax year 2025-26 return): Ravi, a salaried consultant, files his return for tax year 2025-26. The processed intimation under section 270(1) is dated 15 July 2026. It gave credit for only part of his tax deducted at source. The full credit is visible in the TDS statements. Figures are illustrative.

Step	As processed	After rectification
Tax computed on total income	Rs 92,000	Rs 92,000
Less: TDS credit given	Rs 60,000	Rs 80,000
Less: advance tax paid	Rs 20,000	Rs 20,000
Result	92,000 - 60,000 - 20,000 = Rs 12,000 payable	92,000 - 80,000 - 20,000 = Rs 8,000 refund

Ravi applies on 20 October 2026. The authority must pass an order by 30 April 2027 (six months from 31 October 2026, the end of the month of receipt). Because the amendment reduces his liability, section 287(6) requires the Assessing Officer to make the refund of Rs 8,000. The demand of Rs 12,000 no longer stands. The last date for any rectification of this intimation is 31 March 2031.

Worked example 2: a notice before tax goes up

Assumptions: Meena received a refund of Rs 15,000 on an assessment order. The officer later spots an arithmetical slip in the same order that wrongly favoured her by Rs 9,000 of tax. Figures are illustrative.

1. Correct refund = 15,000 - 9,000 = Rs 6,000.
2. This reduces a refund, so section 287(4) applies. The officer must first send Meena a notice of the intention to amend and give her a reasonable opportunity of being heard.
3. If the officer proceeds, a written order is passed (section 287(5)).
4. The refund already made was Rs 15,000 against a correct Rs 6,000, so the excess of Rs 9,000 is raised through a notice of demand deemed issued under section 289 (section 287(7)).

What are the other amendments under section 288?

Section 288(1) lets the Assessing Officer take specified actions when a later event or order changes the position, even beyond the usual period. The four years in section 287(8) are counted from the time given in column D of the table, and section 287 applies to such amendments so far as may be. The eleven cases are:

Sl. No.	Situation	Four years counted from
1	Remuneration to a partner, allowed in the firm's assessment, is later found not deductible under section 35(e). The partner's assessment is adjusted.	End of the financial year in which the subsequent order was passed in the firm's case
2	A member's share in an association of persons or body of individuals is later found missing or wrong in the member's assessment.	End of the financial year in which the subsequent order was passed in the association's or body's case
3	Loss or depreciation is recomputed for a tax year after proceedings under section 279, so later years' total income is recomputed.	End of the financial year in which the section 279 order was passed
4	Capital gain of a transferor company, not charged earlier under section 67 because of section 70(1)(c) or (d), becomes taxable under section 71(1) (conversion to stock-in-trade, or parent or holding company ceasing to hold all the shares within eight years of transfer).	End of the year of conversion, or of the year the parent or holding company ceased to hold the whole share capital
5	Capital gain charged to tax, but the new asset is later bought or the gain is deposited or invested within the extended period under section 89.	End of the financial year in which compensation was received
6	Deduction under section 144 was refused because export income was not received in, or brought into, India, and it later is.	End of the financial year in which the income is received in, or brought into, India
7	Credit for foreign tax was refused because the tax was under dispute, and the dispute is settled. You must furnish evidence of settlement and payment, plus an undertaking against claiming credit elsewhere, within six months from the end of the month of settlement.	End of the financial year in which the dispute is settled
8	Capital gain on land or building was computed on the stamp duty value under section 78(1), and that value is later revised in appeal, revision or reference.	End of the financial year in which the revising order was passed
9	Capital gain on compulsory acquisition, computed on the compensation or consideration, and that amount is later reduced by a court, Tribunal or other authority.	End of the financial year in which the reducing order was passed
10	Deduction under section 152 for patent royalty is disallowed because the patent was revoked or the assessee's name was removed from the register.	End of the financial year in which the Controller's or High Court's order was passed
11	Income was included in a return under section 263 for one tax year, while the tax on it was deducted at source in a later tax year. You apply for credit in the earlier year within two years from the end of the tax year of deduction.	End of the financial year in which the tax was deducted

Section 288(2) covers transfer pricing. Where the arm's length price is fixed for one tax year and the Transfer Pricing Officer has declared the assessee's option valid for the next two consecutive tax years, the Assessing Officer recomputes income for those two years to match. The recomputation is due within three months from the end of the month in which the assessment is completed for the first year.

How do I apply under section 288, Sl. No. 11 (TDS credit in a different year)?

Rule 178 sets the procedure. The application is made in Form No. 102. It is furnished to the Director General of Income-tax (Systems) or a person authorised by him, who forwards it to the Assessing Officer. Section 288(1), Sl. No. 11 requires the application within two years from the end of the tax year in which the tax was deducted.

Worked example 3: income in one year, TDS in the next

Assumptions: Meena, a freelancer, completed work in tax year 2025-26 and included Rs 3,00,000 of fees in her return for that year. The client deducted TDS of Rs 30,000 only in tax year 2026-27 (deducted on 10 May 2026). Figures are illustrative.

1. Her 2025-26 return shows the income, but the TDS credit of Rs 30,000 does not appear in that year's records, so it is not given.
2. She applies in Form 102 within two years from the end of tax year 2026-27, which is by 31 March 2029.
3. The Assessing Officer amends the 2025-26 order or intimation to allow the Rs 30,000 credit, and no credit for it is allowed in any other tax year.
4. The four-year limit for this amendment runs from the end of the financial year in which the tax was deducted, so to 31 March 2031.

What if the rectification order raises my tax and I disagree?

A section 287 order that enhances your assessment or reduces your loss is one of the "specified orders" in rule 199(a)(iv). That means it can be the subject of a dispute taken to a Dispute Resolution Committee under section 379, provided you meet the other specified conditions in rules 196 to 199. Check those conditions before choosing this route, and compare it with an appeal.

Does the Tax Recovery Officer have a role?

Yes, in a narrow case. Under rule 226, the Chief Commissioner or Commissioner of Income-tax can authorise a Tax Recovery Officer to use the Assessing Officer's section 287 powers. This applies to an Assessing Officer's order where a sum is payable and the Tax Recovery Officer has already drawn a recovery certificate under section 413. The Tax Recovery Officer exercises these powers concurrently with the Assessing Officer.

Real-life scenarios

A deductor's TDS statement is processed with a wrong adjustment. A small company's accountant files a TDS statement. The intimation under section 399 shows a short-deduction demand because a challan was mapped to the wrong deductee. The challan details are on record, so the company applies for rectification of the section 399 intimation. A deductor is expressly allowed to do this under section 287(3)(b)(i).

A partner's assessment is already closed. A partner's assessment was completed with the firm's remuneration allowed. A year later the firm's assessment is reopened and the remuneration is held not deductible under section 35(e). Under section 288(1), Sl. No. 1, the officer can adjust the partner's order, counting four years from the end of the financial year in which the firm's order was passed.

Common mistakes

1. Using rectification for a debatable point. Anything needing evidence or an interpretation argument is likely to be refused. Appeal instead (see our guide to income tax appeals).
2. Trying to reopen a point already decided in appeal. Section 287(2) excludes matters considered and decided in an appeal or revision.
3. Counting four years from the order date. The count starts from the end of the financial year in which the order was passed.
4. Ignoring a notice of intention. If the correction would raise your tax, you are entitled to a hearing. Reply in time.
5. Using the wrong route for a Sl. No. 11 TDS credit claim. That case needs Form 102 under rule 178, within two years from the end of the tax year of deduction.
6. Assuming a refund follows automatically. You should track the application and the order, since the six-month clock is the authority's deadline, not yours.

Quick reference

Question	Answer	Source
What can be amended?	Orders, section 270(1) intimations, section 399 intimations	Section 287(1)
Who can apply?	Assessee, deductor or collector	Section 287(3)(b)
Notice needed?	Yes, if tax rises or refund falls	Section 287(4)
Outer limit	4 years from end of financial year of order	Section 287(8)
Decision on application	6 months from end of month of receipt	Section 287(9)
Form for Sl. No. 11 TDS credit	Form No. 102	Rule 178

How can a CA firm keep track of these dates?

Each rectification has two clocks, the four-year outer limit and the six-month disposal period, and every client has a different order date. Finexo's practice management software lets a CA firm record the order date, application date and expected disposal date per client and get reminders before they pass. It does not file applications or decide the merits for you.

Where this is in the Act

• Section 287: rectification of mistake
• Section 288(1) and Table Sl. Nos. 1 to 11: other amendments; section 288(2): transfer pricing recomputation
• Section 236: income-tax authorities
• Section 270(1): processing of returns; section 399: processing of TDS and TCS statements
• Section 289: notice of demand
• Rule 178: Form No. 102 for section 288(1), Sl. No. 11
• Rule 226: Tax Recovery Officer and section 287