54. ASSESSMENT / SCRUTINY – How Your File is Assessed / Scrutinised

Law and procedure for Assessment:

The salient features of the new assessment procedure are:

  1. The requirement of passing the assessment order in all cases where returns are filed, has been dispensed with. The matter now generally ends with the filing of return and issue of the Acknowledgement Slip.

  2. The Assessing Officer shall send intimation where any tax or interest is found payable by the assessee or the refund is due to the Assessee.

  3. Any tax or income found due on the returned income or any refund found payable shall be demanded from or granted to the assessee along with the intimation.

  1. Intimation should be sent within one year from the end of the financial year in which the return is filed. Consequently no tax or interest can be demanded after the expiry of such period.

  2. In cases where no amount is payable by the assessee or refund due to the assesses, the acknowledgement of the return shall be deemed to be intimation.

  3. Scrutiny assessments shall be carried out in certain cases selected by the Assessing Officer.

Compulsory Scrutiny:

As per latest instructions, the following cases will be compulsorily taken up for scrutiny:

  • For Delhi, Mumbai, Chennai, Kolkata, Pune, Hyderabad, Bangalore and Ahmedabad:
  1. If deductions claimed u/s 8OCCC to 80U are Rs. 10 lakhs or more.
  2. In case of refund claimed of Rs. 10 lakhs or more.
  3. In case where addition/disallowance of Rs. 5 lakhs and above has been confirmed by CIT (A) in any three preceding years.
  • For other places:
  1. If deductions claimed under Sec. 8OCCC to 80U are Rs. 5 lakhs or more.
  2. In case of refund claimed of Rs. 5 lakhs or above.
  3. In case where addition/disallowance of Rs. 1 Iakh & above has been confirmed by CIT (A) in any three preceding years.
  • All search, seizure and survey (u/s 1 33A) cases.

  • Cases where income of Rs. 2 Iakhs or more has been claimed as exempt.

  • Cases where the value of International Transaction (u/s 92B) exceeds Rs. 5 crore.

  • All cases of Professional with gross receipt of Rs. 50 Iakh or more and income declared is less than 20% of gross received.

  • All case of contractors having gross contract receipts of more than Rs. 2 crores and net income is less than 5% of gross contract receipts.

  • All cases of stock brokers and sub brokers having brokerage of Rs. 50 Iakhs or more and taxable income of less than 10% of gross brokerage.

  • All cases of stock brokers and sub brokers claiming bad debts of Rs. 5lakhs or more.

Sec. 143(3) : Scrutiny Assessments by Income Tax Department
“Penalties” Under Income Tax Act. 1956
How is a Search Operation Conducted by Income Tax Department ?
Surveys for Checking Ostentatious Expenditure
Surveys for Enforcing Compliance with Provisions of TDS
“Summon” U/s 131 of Income Tax Act.
Investigation by Income Tax Department:
Appellate Authorities of Income Tax Department
Power to Call for Information U/s Sec. 133(6) of Income Tax Act.
Specific Surveys U/s 133A(1) of Income Tax Act.
Types Of Income Subject To TDS [Deduction Of Tax At Source]
Pre-Requisite For Claiming Income Tax Refund
Benefits of Filing Income Tax Returnsn
Section-139(9): Defective Tax Return
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