The Central Board of Direct Taxes (CBDT), last day prescribed guidelines regarding the applicability of section 143(1)(a)(vi) of the Income Tax Act while considering returns for processing pertaining to ITR Forms 2, 3, 4, 5 & 6.
This is to ensure that the provisions of section 143(1)(a)(vi) of the Act are invoked only in appropriate cases.
The circular issued on Wednesday stated that in case of taxpayers who have opted for the presumptive income scheme as per Section 44AD , Sec 44ADA and Section 44AE of the Income Tax Act and filed return in Form ITR-4, the provisions of section 143(1)(a)(iv) is not applicable except in cases where the receipts under these heads are completely omitted from the return.
It further said that for returns in Forms ITR-2 & 3, as receipts/income under the heads ‘salary’ is comparable with information available in the three Forms on a gross basis, provisions of secti on 143(1)(a)(vi) of the Act may be invoked in such cases wherever applicable.
In case of Firms, LLPs, AoPs and BoIs, in respect of income under the heads ‘income from house property’ or ‘income from other sources’, there may be difficulties in ascertaining whether the receipt being shown in the three Forms is getting reflected under the head ‘income from house property’ or ‘income from other sources’ in the ITR Form or is being treated as business income under the head ‘income from business or profession’ by the concerned assessee. “Under these circumstances, any likely difference in income shown under the head ‘income from house property’ or ‘income from other sources’ as contained in ITRs 3, 5 & 6 with the three Forms, being difficult to verify under section 143(1)(a)(vi) of the Act, would be excluded from purview of intimations proposing adjustments,” the circular said.
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