Tax Ready Reckoner

Section 144 of the Income Tax Act, 1961, empowers the Assessing Officer (AO) to determine a taxpayer’s income and tax liability based on their “best judgment” when the taxpayer fails to comply with statutory requirements. This provision ensures tax collection even in cases of non-cooperation or incomplete information. 1. When is Section 144 Invoked? A Best Judgment Assessment is triggered in the following scenarios: Non-Filing of […]

Section 144A of the Income Tax Act, 1961, empowers the Joint Commissioner (JCIT) to intervene in pending assessments by issuing binding directions to the Assessing Officer (AO). This provision ensures uniformity, fairness, and efficiency in complex or high-stakes cases. Below is a detailed breakdown of its scope, procedure, and implications: 1. Key Provisions of Section 144A (A) Authority to Issue Directions The Joint Commissioner may

Section 144B introduces a technology-driven, faceless assessment scheme to eliminate human interface, enhance transparency, and streamline tax administration. Below is a detailed breakdown of its provisions, structure, and procedural framework: 1. Key Objectives of Faceless Assessment Transparency: Eliminate direct interaction between taxpayers and tax officers to reduce bias and corruption. Efficiency: Expedite assessments through automated case allocation and team-based

Section 147 empowers the Assessing Officer (AO) to reassess or recompute income that has escaped taxation in previous years. This provision ensures that all taxable income is accurately reported and taxed, even if initially overlooked. Below is a detailed breakdown of its provisions, procedures, and implications. 1. Key Features of Section 147 (A) Definition of “Income Escaping Assessment” Income is deemed to have

Section 151A empowers the Central Government to implement a faceless, technology-driven scheme for reassessing income that has escaped taxation under Section 147. Introduced by the Finance Act, 2021, and operationalized through the e-Assessment of Income Escaping Assessment Scheme, 2022 (effective from 29 March 2022), this provision aims to eliminate human interface, enhance transparency, and standardize procedures for reopening cases. Below is a detailed analysis of its

Section 153 prescribes strict deadlines for completing assessments, reassessments, and recomputations under the Income Tax Act. Below is a structured breakdown of the time limits, exceptions, and key judicial interpretations. 1. Time Limits for Different Assessments (A) Regular Assessments (Section 143/144) Assessment Year (AY) 2018–19: 18 monthsfrom the end of the AY (i.e., by 30 September 2020). AY 2019–20 Onwards:

Section 154 of the Income Tax Act, 1961, allows the Assessing Officer (AO), Commissioner (Appeals), or other tax authorities to correct apparent mistakes in their orders, including: Arithmetical errors(e.g., incorrect tax calculations). Factual oversights(e.g., missed deductions). Legal mistakes(e.g., misapplication of tax provisions). 1. Key Features of Section 154 (A) Who Can File a Rectification? Taxpayer: Can apply for corrections within 4 yearsfrom

Section 156 of the Income Tax Act, 1961, governs the issuance of demand notices by the Assessing Officer (AO) to taxpayers for unpaid taxes, interest, penalties, or other dues. It formalizes the process of notifying taxpayers about their outstanding liabilities and specifies the timeline for compliance. 1. Key Provisions of Section 156 (A) Purpose of the Notice A demand notice under Section 156is

Section 157 deals with the communication of losses determined by the Assessing Officer (AO) to taxpayers. This provision ensures formal intimation when the AO disagrees with the taxpayer’s declared losses or modifies them during assessment. Key Aspects of Section 157 Purpose Provides official notice when the AO modifies/cancels a taxpayer’s declared loss Serves as the basis for

Overview Section 157A of the Income Tax Act, 1961, was introduced to empower the Central Government to create a faceless mechanism for: Rectification of mistakes apparent from the record Carrying out amendments Issuing notices or intimations This provision aligns with the broader aim of the Income Tax Act to reduce human interface and bring transparency, efficiency, and