Forgot a Deduction in Your ITR? Section 264 Revision Won't Save It Now
A deduction was missed in the return. The CPC processed it as filed, a demand followed, and the revised-return window has closed. For years the standard advice was: file a section 264 revision petition and ask the Commissioner to allow it.
Two Supreme Court orders in 2026 have changed that advice. Section 264 is still a valuable remedy, but only for a narrower set of problems, and picking it wrongly can cost you your appeal too.
Quick answer: Section 264 (now section 378 of the Income-tax Act, 2025) lets the Commissioner give relief against an order, not against your own return. After DCIT v. Om Siddhakala Associates (August 2026) and Orissa Rural Housing Development Corporation v. ACIT (October 2026), a claim that was never made in the return, or not made through a timely revised return, cannot be brought in through revision.
Contents
What is a section 264 revision petition?
Section 264(1) of the Income-tax Act, 1961 allows the Principal Commissioner or Commissioner to call for the record of any proceeding, make inquiries and pass any order that is not prejudicial to the assessee. It covers orders of subordinate authorities other than those that section 263 governs.
It is the taxpayer's mirror image of section 263 revision, which lets the Commissioner revise orders that are erroneous and prejudicial to the revenue.
It can start on the Commissioner's own motion, or on your application.
It can only help you: an order declining to interfere is deemed not to be prejudicial.
It is heard by the Principal Commissioner or Commissioner, not by the Assessing Officer or the CIT(A).
Under the 2025 Act, section 378 uses the term "Competent Authority", which also covers the Principal Chief Commissioner and Chief Commissioner.
What did the Supreme Court decide in 2026?
DCIT, CPC v. Om Siddhakala Associates (Civil Appeal No. 10175 of 2026, order dated 5 August 2026). The assessee had not claimed the section 43CA tolerance limit in its return and did not revise it. CPC processed the return under section 143(1) and raised a demand. The assessee sought the benefit through a section 264 petition, which the Principal Commissioner rejected.
The High Court remanded the matter. The Supreme Court set the remand aside and said that, the return not having been revised in time, "there is no question of revision under Section 264, which would be an attempt to revise the return under the garb of a revision." The Court left open whether the tolerance limit is retrospective.
Orissa Rural Housing Development Corporation Ltd. v. ACIT (Civil Appeal Nos. 7249-7250 of 2015, 2026 INSC 1116, order dated 8 October 2026). The assessee's attempt to revise its return was not taken into account in the assessment, and its section 264 petition was dismissed on the ground that a fresh claim needs a revised return.
Its later appeal to the CIT(A) was dismissed as not maintainable, because it had already used section 264. The Supreme Court followed Om Siddhakala and Goetze (India) Ltd. v. CIT (2006) 284 ITR 323 and held that the revisional authority may entertain a new question of law, but not anything beyond the facts that were available with the Assessing Officer. The appeals were dismissed.
When does section 264 still work?
Read together, the two orders confine section 264 to correcting an order on the record that was before the authority. Situations that remain strong candidates:
A claim made in the return, and supported on record, that the AO or CPC disallowed or overlooked
A double addition, or an addition of income already offered in the return
A wrong computation of tax, interest or set-off in the order
A legal point that arises from facts already on record, for example a wrong rate applied to a disclosed receipt
An order where the appeal was not filed and the appeal period has expired
Older High Court rulings such as C. Parikh & Co. v. CIT (1980) 122 ITR 610 (Guj) and Vijay Gupta v. CIT (2016) 386 ITR 643 (Del) read section 264 widely, including for mistakes made by the assessee. Rely on them now only to the extent that they fit within the 2026 Supreme Court orders.
Worked example: two taxpayers, two outcomes
The figures are illustrative and assume the old regime, a 30% slab, 4% cess and no surcharge, so the tax effect is 31.2%.
Meera (AY 2023-24). She claimed ₹6,00,000 of business expenses in her return and uploaded the invoices in reply to a scrutiny notice. The assessment order disallowed the full amount as "unvouched", overlooking the uploaded invoices. The order was served on 10 February 2026 and she missed the 30-day appeal deadline.
Tax effect of the disallowance: ₹6,00,000 × 31.2% = ₹1,87,200, plus interest
The claim was in the return and the evidence was on the AO's record
Appeal period over, no appeal filed, so section 264(4) does not bar revision
Last date for the petition: one year from 10 February 2026, that is, by 9 February 2027
If the petition is filed in FY 2026-27, the order is due within one year from the end of that year, by 31 March 2028
Rohan (AY 2025-26). A salaried employee, he paid ₹1,50,000 into PPF but forgot to claim section 80C. CPC processed the return as filed. The time to file a revised return for that year under section 139(5) is over.
Tax lost: ₹1,50,000 × 31.2% = ₹46,800
A section 264 petition now asks for a claim that was never in the return, which Om Siddhakala rules out
An updated return under section 139(8A) cannot be used to reduce tax or increase a refund, so it does not help either
The difference is not the amount. It is whether the claim and its facts were before the authority whose order you want revised.
Practice guide for professionals
Amended Form 3CD: A Practical Guide (₹299) works clause by clause through the tax audit disclosures that most often become disallowances and, later, revision or appeal issues. The ₹699 bundle has all four practice guides.
Appeal, rectification or revision: how to choose
Each remedy fixes a different kind of problem. Picking the wrong one wastes time and, after Orissa Rural, can close the other door.
Problem | Better route | Why |
|---|---|---|
Arithmetic error or credit not given, obvious from the record | Rectification, s.154 of the 1961 Act | Quick and does not use up the appeal route |
Dispute on facts or law, appeal time still open | Appeal to CIT(A), s.246A/249 (2025 Act s.358) | Wide powers, including additional evidence under Rule 46A |
Order wrong on the record, appeal time over | Revision, s.264 (2025 Act s.378) | One-year window and condonation of delay |
Claim omitted from the return, revised-return time open | Revised return, s.139(5) | The only clean route after Om Siddhakala |
Claim omitted, revised-return time over | Very limited | Neither revision nor an updated return will reduce tax |
For a CPC demand, start with whether to seek rectification or appeal, and check the section 143(1)(a) adjustment rules before choosing revision.
Time limits, fee and the appeal bar
Point | Income-tax Act, 1961 | Income-tax Act, 2025 |
|---|---|---|
Who decides | Pr. CIT or CIT | Competent Authority (Pr. CCIT, CCIT, Pr. CIT or CIT) |
Time to apply | 1 year from communication or knowledge, whichever earlier: s.264(3) | Same: s.378(3) |
Late application | Admitted for sufficient cause | Same: s.378(4) |
Appeal bar | s.264(4) | s.378(5) |
Fee | ₹500: s.264(5) | ₹500: s.378(6) |
Time for the order | 1 year from end of FY of application: s.264(6) | Same: s.378(7) |
The appeal bar works in three ways. Revision is not available while the order is under appeal, or while the appeal time is running unless you waive your right of appeal. If you file revision, expect the CIT(A) to refuse a later appeal on the same order.
How to draft a petition that survives
Identify the exact order (assessment order, 143(1) intimation or other order) and its date of service.
Show where the claim appears in the return and where the supporting evidence sits on the record, with page or portal references.
Frame the error as one in the order, not as a new claim. Quote the Om Siddhakala test and show you meet it.
If you rely on a legal point, show that it arises from facts already on record.
State that no appeal is pending, and either that the appeal time has expired or that you waive the right of appeal.
If filed late, attach a dated explanation and evidence for each period of delay.
Pay the ₹500 fee and keep the challan and acknowledgement.
If the demand is being recovered meanwhile, read how a stay of demand works; the revision petition alone does not stop recovery.
Decision checklist
Was the claim made in the original return or a timely revised return?
Were the supporting facts before the AO or CPC?
Is the error in the order, rather than in your return?
Has the appeal period expired, or are you willing to waive the appeal?
Is the mistake apparent from the record, so that section 154 is quicker?
Are you within one year of the order, or can you justify the delay?
For AY 2026-27, can you still revise the return before 31 March 2027 instead?
Common mistakes
Using section 264 to add a deduction that was never claimed, after the revised-return window
Filing revision and an appeal on the same order, or filing revision first and then expecting an appeal to be heard
Treating the date you downloaded the order as the date of knowledge, when the portal shows earlier service
Attaching fresh documents that were never before the AO without explaining how the facts were already on record
Waiting for the revision outcome while the demand is being adjusted against refunds
Ignoring the cheaper fix: a revised return while the year is still open
Practitioner insights
The decisive question after 2026 is "what was on the record?" Build the petition around the record, not around fairness.
Om Siddhakala is a short order arising from a 143(1) intimation. Expect it to be cited against almost every petition that relies on a new claim, so meet it head-on.
Where facts and law are both disputed and the appeal time is open, an appeal usually gives wider relief, including the chance to seek admission of evidence under Rule 46A..
For AY 2026-27, the revised-return window now runs to 31 March 2027. A short internal review of large returns before that date is the cheapest litigation strategy available.
On evidence that never reached the AO, see when Rule 46A lets new evidence into an appeal.
Old and new section numbers
Point | 1961 Act | 2025 Act |
|---|---|---|
Revision in favour of assessee | Section 264 | Section 378 |
Revision prejudicial to revenue | Section 263 | Section 377 |
Return of income | Section 139 | Section 263 |
Appeal to CIT(A) | Section 249, Form 35 | Section 358, Form 99 |
Appeal to ITAT | Section 253, Form 36 | Section 362, Form 115 |
Frequently asked questions
What is section 264 of the Income-tax Act?
Section 264 of the Income-tax Act, 1961 lets the Principal Commissioner or Commissioner revise an order of a subordinate authority, on his own or on the assessee's application, but only in a way that is not prejudicial to the assessee. Section 378 of the Income-tax Act, 2025 carries the same power.
Can I claim a deduction I forgot in my return through section 264?
Generally no, after the Supreme Court's 2026 rulings. In DCIT v. Om Siddhakala Associates (5 August 2026), the Court held that seeking a claim not made in the return, after the revised-return period expired, is an attempt to revise the return under the garb of a revision.
What is the time limit for filing a section 264 revision petition?
One year from the date the order was communicated to you or the date you otherwise came to know of it, whichever is earlier. The Commissioner can admit a late application if you show sufficient cause for the delay.
What is the fee for a section 264 application?
₹500, under section 264(5) of the 1961 Act and section 378(6) of the 2025 Act.
Can I file an appeal and a section 264 petition against the same order?
No. Revision is barred where the order is under appeal, and while the appeal time is running unless you waive the right of appeal. In Orissa Rural Housing Development Corporation (October 2026), the CIT(A) had treated an appeal as not maintainable because the assessee had already used section 264, and the Supreme Court dismissed the assessee's appeals.
Can a section 264 order be challenged before the ITAT?
The ITAT appeal provisions do not list section 264 orders, so the usual remedy against a rejection is a writ petition before the High Court under Article 226 of the Constitution.
What is the last date to revise my return for AY 2026-27?
After the Finance Act, 2026, section 139(5) allows a revised return before the end of the assessment year, 31 March 2027, or before completion of the assessment, whichever is earlier, subject to the fee under section 234-I.
Related reading
Sources
Income-tax Act, 1961: sections 139(5) (as substituted by section 5 of the Finance Act, 2026), 139(8A), 143(1), 154, 246A, 249, 253, 263, 264; Income-tax Act, 2025: sections 263, 358, 362, 377, 378; DCIT, CPC v. Om Siddhakala Associates, Civil Appeal No. 10175 of 2026 (SC, 5 August 2026); Orissa Rural Housing Development Corporation Ltd. v. ACIT, Civil Appeal Nos. 7249-7250 of 2015, 2026 INSC 1116 (SC, 8 October 2026); Goetze (India) Ltd. v. CIT (2006) 284 ITR 323 (SC); C. Parikh & Co. v. CIT (1980) 122 ITR 610 (Guj); Vijay Gupta v. CIT (2016) 386 ITR 643 (Del). Figures are illustrative. Educational content only, reflecting the law as of 2 November 2026; check the current law for your facts.
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