19 September, 2014

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Accounting professionals seek legal intervention for clarity on tax audit deadline


KOLKATA: The Central Board of Direct Taxes (CBDT) had on July 25 extended the due date for filing Tax Audit Report (TAR) u/s 44AB of the Income Tax Act 1961, for assessment year 2014-15 to November 30 from the earlier date of September 30. The circular, however, did not refer to the deadline for filing Income Tax Return (ITR).

To seek clarity regarding the date of filing ITR, chartered accountants have written to concerned authorities such as finance ministry, CBDT etc. They have also deliberated on same on social media but have failed to get a satisfactory response. They have now decided to slug out the matter in courts.
Tax professionals and taxpayers in other parts of the country, too, are likely to move to courts, as they feel the CBDT directive has added to confusion rather than providing any relief.

The circular by CBDT has lead to one more confusion. There is ambiguity regarding the due date for filing ITR u/s 139 of the Income Tax Act in cases where tax audit is applicable. It is because as per income tax act 1961, the deadline for filing ITR is the same as that for filing TAR.
Technically speaking, ITRs can be filed without tax audit report, but this action is neither advisable nor is it practical as a taxpayer has to compute total income after taking into consideration various deductions which are based on tax audit report.

Filing of ITR without TAR will consequently lead to filing of revised ITR which will further increase the work load of IT department.

Source: Economic Times

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