Section 143 - Assessment - Income-tax Act, 1961

1 [Assessment 2 . 143. 18 [ (1) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142, such return shall be processed in the following manner, namely:- (a) the total income or loss shall be computed after making the following adjustments, namely:- (i) any arithmetical error in the return; 23 [ **** ] (ii) an incorrect claim, if such incorrect claim is apparent from any information in the return; 47 [ (iia) any such inconsistency in the return, with respect to the information in the return of any preceding previous year, as may be prescribed; ] 24 [ (iii) disallowance of loss claimed, if return of the previous year for which set off of loss is claimed was furnished beyond the due date specified under sub-section (1) of section 139; (iv) 41 [ disallowance of expenditure or increase in income indicated ] in the audit report but not taken into account in computing the total income in the return; (v) disallowance of deduction claimed under 42 [ section 10AA or under any of the provisions of Chapter VI-A under the heading C.-Deductions in respect of certain incomes , if ] the return is furnished beyond the due date specified under sub-section (1) of section 139; or (vi) addition of income appearing in Form 26AS or Form 16A or Form 16 which has not been included in computing the total income in the return: Provided that no such adjustments shall be made unless an intimation is given to the assessee of such adjustments either in writing or in electronic mode: Provided further that the response received from the assessee, if any, shall be considered before making any adjustment, and in a case where no response is received within thirty days of the issue of such intimation, such adjustments shall be made; ] 33 [Provided also that no adjustment shall be made under sub-clause (vi) in relation to a return furnished for the assessment year commencing on or after the 1st day of April, 2018; ] (b) the tax 27 [ , interest and fee ] , if any, shall be computed on the basis of the total income computed under clause (a); (c) the sum payable by, or the amount of refund due to, the assessee shall be determined after adjustment of the tax 28 [ , interest and fee ] , if any, computed under clause (b) by any tax deducted at source, any tax collected at source, any advance tax paid, 35 [ any relief allowable under section 89, ] any relief allowable under an agreement under section 90 or section 90A, or any relief allowable under section 91, any rebate allowable under Part A of Chapter VIII, any tax paid on self-assessment and any amount paid otherwise by way of tax 29 [ , interest or fee ] ; (d) an intimation shall be prepared or generated and sent to the assessee specifying the sum determined to be payable by, or the amount of refund due to, the assessee under clause (c); and (e) the amount of refund due to the assessee in pursuance of the determination under clause (c) shall be granted to the assessee: Provided that an intimation shall also be sent to the assessee in a case where the loss declared in the return by the assessee is adjusted but no tax, 30 [ interest or fee ] is payable by, or no refund is due to, him: Provided further that no intimation under this sub-section shall be sent after the expiry of 40 [ nine months ] from the end of the financial year in which the return is made. Explanation .-For the purposes of this sub-section,- (a) an incorrect claim apparent from any information in the return shall mean a claim, on the basis of an entry, in the return,- (i) of an item, which is inconsistent with another entry of the same or some other item in such return; (ii) in respect of which the information required to be furnished under this Act to substantiate such entry has not been so furnished; or (iii) in respect of a deduction, where such deduction exceeds specified statutory limit which may have been expressed as monetary amount or percentage or ratio or fraction; (b) the acknowledgement of the return shall be deemed to be the intimation in a case where no sum is payable by, or refundable to, the assessee under clause (c), and where no adjustment has been made under clause (a). (1A) For the purposes of processing of returns under sub-section (1), the Board may make a scheme for centralised processing of returns with a view to expeditiously determining the tax payable by, or the refund due to, the assessee as required under the said sub-section. (1B) Save as otherwise expressly provided, for the purpose of giving effect to the scheme made under sub-section (1A), the Central Government may, by notification in the Official Gazette, direct that any of the provisions of this Act relating to processing of returns shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in that notification; so, however, that no direction shall be issued after the 31st day of March, 20 [ 2012 ] . (1C) Every notification issued under sub-section (1B), along with the scheme made under sub-section (1A), shall, as soon as may be after the notification is issued, be laid before each House of Parliament. ] 31 [ (1D) Notwithstanding anything contained in sub-section (1), the processing of a return shall not be necessary, where a notice has been issued to the assessee under sub-section (2): Provided that the provisions of this sub-section shall not apply to any return furnished for the assessment year commencing on or after the 1st day of April, 2017. ] 26 [ (2) Where a return has been furnished under section 139, or in response to a notice under sub-section (1) of section 142, the Assessing Officer or the prescribed income-tax authority, as the case may be, if, considers it necessary or expedient to ensure that the assessee has not understated the income or has not computed excessive loss or has not under-paid the tax in any manner, shall serve on the assessee a notice requiring him, on a date to be specified therein, either to attend the office of the Assessing Officer or to produce, or cause to be produced before the Assessing Officer any evidence on which the assessee may rely in support of the return: Provided that no notice under this sub-section shall be served on the assessee after the expiry of 43 [ three ] months from the end of the financial year in which the return is furnished. ] 11 [ (3) 32 [ On the day specified in the notice issued under ] sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him or refund of any amount due to him on the basis of such assessment: ] 44 [Provided that in the case of a- (a) research association referred to in clause (21) of section 10; (b) news agency referred to in clause (22B) of section 10; (c) association or institution referred to in clause (23A) of section 10; (d) institution referred to in clause (23B) of section 10, which is required to furnish the return of income under sub-section (4C) of section 139, no order making an assessment of the total income or loss of such research association, news agency, association or institution, shall be made by the Assessing Officer, without giving effect to the provisions of section 10, unless- (i) the Assessing Officer has intimated the Central Government or the prescribed authority the contravention of the provisions of clause (21) or clause (22B) or clause (23A) or clause (23B), as the case may be, by such research association, news agency, association or institution, where in his view such contravention has taken place; and (ii) the approval granted to such research association or other association or institution has been withdrawn or notification issued in respect of such news agency or association or institution has been rescinded: ] 14 [ 45 [ Provided further that where the Assessing Officer is satisfied that any fund or institution referred to in sub-clause (iv) or trust or institution referred to in sub-clause (v) or any university or other educational institution referred to in sub-clause (vi) or any hospital or other medical institution referred to in sub-clause (via), of clause (23C) of section 10, or any trust or institution referred to in section 11, has committed any specified violation as defined in Explanation 2 to the fifteenth proviso to clause (23C) of section 10 or the Explanation to sub-section (4) of section 12AB, as the case may be, he shall- (a) send a reference to the Principal Commissioner or Commissioner to withdraw the approval or registration, as the case may be; and (b) no order making an assessment of the total income or loss of such fund or institution or trust or any university or other educational institution or any hospital or other medical institution shall be made by him without giving effect to the order passed by the Principal Commissioner or Commissioner under clause (ii) or clause (iii) of the fifteenth proviso to clause (23C) of section 10 or clause (ii) or clause (iii) of sub-section (4) of section 12AB: Provided also] that where the Assessing Officer is satisfied that the activities of the university, college or other institution referred to in clause (ii) and clause (iii) of sub-section (1) of section 35 are not being carried out in accordance with all or any of the conditions subject to which such university, college or other institution was approved, he may, after giving a reasonable opportunity of showing cause against the proposed withdrawal to the concerned university, college or other institution, recommend to the Central Government to withdraw the approval and that Government may by order, withdraw the approval and forward a copy of the order to the concerned university, college or other institution and the Assessing Officer. ] 46 [ **** ] 34 [ (3A) The Central Government may make a scheme, by notification in the Official Gazette, for the purposes of making assessment of total income or loss of the assessee under sub-section (3) 36 [ or section 144 ] so as to impart greater efficiency, transparency and accountability by (a) eliminating the interface between the Assessing Officer and the assessee in the course of proceedings to the extent technologically feasible; (b) optimising utilisation of the resources through economies of scale and functional specialisation; (c) introducing a team-based assessment with dynamic jurisdiction. (3B) The Central Government may, for the purpose of giving effect to the scheme made under sub-section (3A), by notification in the Official Gazette, direct that any of the provisions of this Act relating to assessment of total income or loss shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the notification: Provided that no direction shall be issued after the 37 [ 31st day of March, 38 [ 2021 ]] . (3C) Every notification issued under sub-section (3A) and sub-section (3B) shall, as soon as may be after the notification is issued, be laid before each House of Parliament. ] 39 [ (3D) Nothing contained in sub-section (3A) and sub-section (3B) shall apply to the assessment made under sub-section (3) or under section 144, as the case may be, on or after the 1st day of April, 2021. ] 15 [ (4) Where a regular assessment under sub-section (3) of this section or section 144 is made,- ( a ) any tax or interest paid by the assessee under sub-section (1) shall be deemed to have been paid towards such regular assessment ; ( b ) if no refund is due on regular assessment or the amount refunded under sub-section (1) exceeds the amount refundable on regular assessment, the whole or the excess amount so refunded shall be deemed to be tax payable by the assessee and the provisions of this Act shall apply accordingly. (5) 16 [ **** ]] 17 [ **** ] **************** NOTES:- 1. Substituted vide Section 48 of the Direct Tax Laws (Amendment) Act, 1987 w.e.f. 01-04-1989 before it was read as, 143. Assessment (1)(a) Where a return has been made under section 139, the Assessing Officer may, without requiring the presence of the assessee or the production by him of any evidence in support of the return, make an assessment of the total income or loss of the assessee after making such adjustments to the income or loss declared in the return as are required to be made under clause (b), with reference to the return and the accounts and documents, if any, accompanying it, and for the purposes of the adjustments referred to in sub-clause (iv) of clause (b), also with reference to the record of the assessments, if any, of past years, and determine the sum payable by the assessee or refundable to him on the basis of such assessment. (b) In making an assessment of the total income or loss of the assessee under clause (a), the Assessing Officer shall make the following adjustments to the income or loss declared in the return, that is to say, he shall, (i) rectify any arithmetical errors in the return, accounts and documents, referred to in clause (a); (ii) [ **** ] (iii) [ **** ] (iv) give due effect to the allowance referred to in sub-section (2) of section 32, the deduction referred to in clause (ii) of sub-section (3) of section 32A or; clause (ii) of sub-section (2) of section 33 or clause (ii) of sub-section (2) of section 33A or clause (i) of sub-section (2) of section 35 or sub-section (1) of section 35A or sub-section (1) of section 35D or sub-section (1) of section 35E or the first proviso to clause (ix) of sub-section (1) of section 36, any loss carried forward under sub-section (1) of section 72 or sub-section (2) of section 73 or sub-section (1) or sub-section (3) of section 74 or sub-section (3) of section 74A and the deficiency referred to in sub-section (3) of section 80J, as computed, in each case, in the regular assessment, if any, for the earlier assessment year or years. (2) Where a return has been made under section 139, and (a) an assessment having been made under sub-section (1), the assessee makes within one month from the date of service of the notice of demand issued in consequence of such assessment, an application to the Assessing Officer objecting to the assessment, or (b) whether or not an assessment has been made under sub-section (1), the Assessing Officer considers it necessary or expedient to verify the correctness and completeness of the return by requiring the presence of the assessee or the production of evidence in this behalf, the Assessing Officer shall serve on the assessee a notice requiring him. on a date to be therein specified, either to attend at the Assessing Officer s office or to produce, or to cause to be there produced, any evidence on which the assessee may rely in support of the return: Provided that, in a case, where an assessment has been made under sub-section (1), the notice under this sub-section except where such notice is in pursuance of an application by the assessee under clause (a) shall not be issued by the Assessing Officer unless the previous approval of the Deputy Commissioner has been obtained to the issue of such notice: Provided further that in a case where the assessment made under sub-section (1) is objected to by the assessee by an application under clause (a), the assessee shall not be deemed to be in default in respect of the whole or any part of the amount of the tax demanded in pursuance of the assessment under that sub-section, which is disputed by the assessee, in so far as such amount does not relate to any adjustment referred to in sub-clause (i) of clause (b) of sub-section (1), and further no interest shall be chargeable under sub-section (2) of section 220 in respect of such disputed amount. (3) On the day specified in the notice issued under sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, (a) in a case where no assessment has been made under sub-section (1), the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him or refundable to him on the basis of such assessment; (b) in a case where an assessment has been made under sub-section (1), if either such assessment has been objected to by the assessee by an application under clause (a) of sub-section (2) or the Assessing Officer is of opinion that such assessment is incorrect, inadequate or incomplete in any material respect, the Assessing Officer shall, by an order in writing, make a fresh assessment of the total income or loss of the assessee, and determine the sum payable by him or refundable to him on the basis of such assessment. Explanation : For the purposes of this section, (1) an assessment under sub-section (1) shall be deemed to be incorrect, inadequate or incomplete in a material respect, if (a) the amount of the total income as determined under sub-section (1) is greater or smaller than the amount of the total income on which the assessee is properly chargeable under this Act to tax; or (b) the amount of the tax payable as determined under sub-section (1) is greater or smaller than the amount of the tax properly payable under this Act by the assessee; or (c) the amount of any loss as determined under sub-section (1) is greater or smaller than the amount of the loss, if any, determinable under this Act on a proper computation; or (d) the amount of any depreciation allowance, development rebate or any other allowance or deduction as determined under sub-section (1) is greater or smaller than the amount of the depreciation allowance, development rebate or, as the case may be, other allowance or deduction properly allowable under this Act; or (e) the amount of the refund as determined under sub-section (1) is greater or smaller than the amount of the refund, if any, due under this Act on a proper computation; or (f) the status in which the assessee has been assessed under sub-section (1) is different from the status in which the assessee is properly assessable under this Act; (2) status , in relation to an assessee, means the classification of the assessee as an individual, a Hindu undivided family, or any other category of persons referred to in clause (31) of section 2, and where the assessee is a firm, its classification as a registered firm or an unregistered firm. Earlier , Amended vide Section 30 of the Taxation Laws (Amendment) Act, 1970 w.e.f. 01-04-1971 And was Amended vide Section 13 of the Finance Act, 1974 w.e.f. 01-04-1975 And was Amended vide Section 26 of the Finance Act, 1976 w.e.f. 01-04-1976 And was Amended vide Section 25 of the Finance (No. 2) Act, 1980 w.e.f. 01-04-1980 And was Amended vide Section 74 of the Finance Act, 1987 w.e.f. 01-04-1988 2. The provisions of section 143 as they stood before the commencement of the Direct Tax Laws (Amendment) Act, 1987, shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1988 and any earlier assessment year- vide Income-tax (Removal of Difficulties) Order, 1989. 3. Substituted vide Section 64 of the Finance Act, 1999 w.e.f. 01-06-1999 before it was read as, (1)(a) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142,- (i) if any tax or interest is found due on the basis of such return, after adjustment of any tax deducted at source, any advance tax paid and any amount paid otherwise by way of tax or interest, then, without prejudice to the provisions of sub-section (2), an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice of demand issued under section 156 and all the provisions of this Act shall apply accordingly ; and (ii) if any refund is due on the basis of such return, it shall be granted to the assessee : Provided that in computing the tax or interest payable by, or refundable to, the assessee, the following adjustments shall be made in the income or loss declared in the return, namely :- (i) any arithmetical errors in the return, accounts or documents accompanying it shall be rectified ; (ii) any loss carried forward, deduction, allowance or relief, which, on the basis of the information available in such return, accounts or documents, is prima facie admissible but which is not claimed in the return, shall be allowed ; (iii) any loss carried forward, deduction, allowance or relief claimed in the return, which, on the basis of the information available in such return, accounts or documents, is prima facie inadmissible, shall be disallowed : Provided further that an intimation shall be sent to the assessee whether or not any adjustment has been made under the first proviso and notwithstanding that no tax or interest is due from him : Provided also that an intimation under this clause shall not be sent after the expiry of two years from the end of the assessment year in which the income was first assessable. (b) Where as a result of an order made under sub-section (3) of this section or section 144 or section 147 or section 154 or section 155 or section 250 or section 254 or section 260 or section 262 or section 263 or section 264, or any order of settlement made under sub-section (4) of section 245D relating to any earlier assessment year and passed subsequent to the filing of the return referred to in clause (a), there is any variation in the carry forward loss, deduction, allowance or relief claimed in the return, and as a result of which,- (i) if any tax or interest is found due, an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice of demand issued under section 156 and all the provisions of this Act shall apply accordingly, and (ii) if any refund is due, it shall be granted to the assessee : Provided that an intimation for any tax or interest due under this clause shall not be sent after the expiry of four years from the end of the financial year in which any such order was passed. (c) Where the assessee is a member of an association of persons or body of individuals and as a result of the adjustments made under the first proviso to clause (a) of sub-section (1) in the income or loss declared in the return made by the association or body, as the case may be, or as a result of an order made under sub-section (3) of this section or section 144 or section 147 or section 154 or section 155 or sub-section (1) or sub-section (2) or sub-section (3) or sub-section (5) of section 185 or sub-section (1) or sub-section (2) of section 186 or section 250 or section 254 or section 260 or section 262 or section 263 or section 264, or any order of settlement made under sub-section (4) of section 245D, passed subsequent to the filing of the return referred to in clause (a), there is any variation in his share in the income or loss of the association or body, as the case may be, or in the manner of inclusion of his share in the returned income, then,- (i) if any tax or interest is found due, an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice of demand issued under section 156 and all the provisions of this Act shall apply accordingly, and (ii) if any refund is due, it shall be granted to the assessee : Provided that an intimation for any tax or interest due under this clause shall not be sent after the expiry of four years from the end of the financial year in which any such adjustments were made or any such order was passed. Earlier , Amended vide Section 21 of the Direct Tax Laws (Amendment) Act, 1989 w.e.f. 01-04-1989 And was Amended vide Section 16 of the Direct Tax Laws (Second Amendment) Act, 1989 w.e.f. 01-04-1989 And was Amended vide Section 60 of the Finance Act, 1992 w.e.f. 01-04-1993 And was Amended vide Section 43 of the Finance Act, 1997 w.e.f. 01-04-1998 4. Substituted vide Section 62 of the Finance Act, 2001 w.e.f. 01-06-2001 before it was read as, two years from the end of the assessment year in which the income was first assessable 5. Inserted vide Section 62 of the Finance Act, 2001 w.e.f. 01-06-2001 6. Omitted vide Section 64 of the Finance Act, 1999 w.e.f. 01-06-1999 before it was read as, (1A) (a) Where as a result of the adjustments made under the first proviso to clause (a) of sub-section (1),- (i) the income declared by any person in the return is increased ; or (ii) the loss declared by such person in the return is reduced or is converted into income, the Assessing Officer shall,- (A) in a case where the increase in income under sub-clause (i) of this clause has increased the total income of such person, further increase the amount of tax payable under sub-section (1) by an additional income-tax calculated at the rate of twenty per cent on the difference between the tax on the total income so increased and the tax that would have been chargeable had such total income been reduced by the amount of adjustments and specify the additional income-tax in the intimation to be sent under sub-clause (i) of clause (a) of sub-section (1) ; (B) in a case where the loss so declared is reduced under sub-clause (ii) of this clause or the aforesaid adjustments have the effect of converting that loss into income, calculate a sum (hereinafter referred to as additional income-tax) equal to twenty per cent of the tax that would have been chargeable on the amount of the adjustments as if it had been the total income of such person and specify the additional income-tax so calculated in the intimation to be sent under sub-clause (i) of clause (a) of sub-section (1) ; (C) where any refund is due under sub-section (1), reduce the amount of such refund by an amount equivalent to the additional income-tax calculated under sub-clause (A) or sub-clause (B), as the case may be. (b) Where as a result of an order under sub-section (3) of this section or section 154 or section 250 or section 254 or section 260 or section 262 or section 263 or section 264, the amount on which additional income-tax is payable under clause (a) has been increased or reduced, as the case may be, the additional income-tax shall be increased or reduced accordingly, and,- (i) in a case where the additional income-tax is increased, the Assessing Officer shall serve on the assessee a notice of demand under section 156 ; (ii) in a case where the additional income-tax is reduced, the excess amount paid, if any, shall be refunded. Earlier , Inserted vide Section 21 of the Direct Tax Laws (Amendment) Act, 1989 w.e.f. 01-04-1989 And was Amended vide Section 16 of the Direct Tax Laws (Second Amendment) Act, 1989 w.e.f. 01-04-1989 And was Amended vide Section 60 of the Finance Act, 1992 w.e.f. 01-04-1989 And was Amended vide Section 24 of the Finance Act, 1993 w.e.f. 01-04-1989 7. Omitted vide Section 64 of the Finance Act, 1999 w.e.f. 01-06-1999 before it was read as, (1B) Where an assessee furnishes a revised return under sub-section (5) of section 139 after the issue of an intimation, or the grant of refund, if any, under sub-section (1) of this section, the provisions of sub-sections (1) and (1A) of this section shall apply in relation to such revised return and- (i) the intimation already sent for any income-tax, additional income-tax or interest shall be amended on the basis of the said revised return and where any amount payable by way of income-tax, additional income-tax or interest specified in the said intimation has already been paid by the assessee then, if any such amendment has the effect of- (a) enhancing the amount already paid, the intimation amended under this clause shall be sent to the assessee specifying the excess amount payable by him and such intimation shall be deemed to be a notice of demand issued under section 156 and all the provisions of this Act shall apply accordingly; (b) reducing the amount already paid, the excess amount paid shall be refunded to the assessee ; (ii) the amount of the refund already granted shall be enhanced or reduced on the basis of the said revised return and where the amount of refund already granted is- (a) enhanced, only the excess amount of refund due to the assessee shall be paid to him ; (b) reduced, the excess amount so refunded shall be deemed to be the tax payable by the assessee and an intimation shall be sent to the assessee specifying the amount so payable, and such intimation shall be deemed to be a notice of demand issued under section 156 and all the provisions of this Act shall apply accordingly : Provided that an assessee, who has furnished a revised return under sub-section (5) of section 139 after the service upon him of the intimation under sub-section (1) of this section, shall be liable to pay additional income-tax in relation to the adjustments made under the first proviso to clause (a) of sub-section (1) and specified in the said intimation, whether or not he has made the said adjustments in the revised return. Earlier , Inserted vide Section 37 of the Finance Act, 1990 w.e.f. 01-04-1989 8. Substituted vide Section 60 of the Finance Act, 2002 w.e.f. 01-06-2002 before it was read as, (2) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142, the Assessing Officer shall, if he considers it necessary or expedient to ensure that the assessee has not understated the income or has not computed excessive loss or has not under-paid the tax in any manner, serve on the assessee a notice requiring him, on a date to be specified therein, either to attend his office or to produce, or cause to be produced there, any evidence on which the assessee may rely in support of the return : Provided that no notice under this sub-section shall be served on the assessee after the expiry of twelve months from the end of the month in which the return is furnished. Earlier , Amended vide Section 16 of the Direct Tax Laws (Second Amendment) Act, 1989 w.e.f. 01-04-1989 And was Amended vide Section 46 of the Finance (No. 2) Act, 1991 w.e.f. 01-10-1991 9. Inserted vide Section 64 of the Finance Act, 2003 w.e.f. 01-06-2003 10. Substituted vide Section 64 of the Finance Act, 2003 w.e.f. 01-06-2003 before it was read as, this sub-section 11. Substituted vide Section 60 of the Finance Act, 2002 w.e.f. 01-06-2002 before it was read as, (3) On the day specified in the notice issued under sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him or refund of any amount due to him on the basis of such assessment. Earlier , Inserted vide Section 42 of the Finance (No. 2) Act, 1998 w.e.f. 01-10-1998 12. Inserted vide Section 60 of the Finance Act, 2002 w.e.f. 01-04-2003 13. Inserted vide Section 47 of the Finance Act, 2007 w.e.f. 01-06-2007 14. Inserted vide Section 13 of the Taxation Laws (Amendment) Act, 2006 w.e.f. 01-04-2006 15. Inserted vide Section 16 of the Direct Tax Laws (Second Amendment) Act, 1989 w.e.f. 01-04-1989 16. Omitted vide Section 64 of the Finance Act, 1999 w.e.f. 01-06-1999 before it was read as, (5) The provisions of this section as they stood immediately before their amendment by the Direct Tax Laws (Amendment) Act, 1987 (4 of 1988), shall apply to and in relation to any assessment for the assessment year commencing on the 1st day of April, 1988, or any earlier assessment year and references in this section to the other provisions of this Act shall be construed as references to those provisions as for the time being in force and applicable to the relevant assessment year. Earlier , Inserted vide Section 16 of the Direct Tax Laws (Second Amendment) Act, 1989 w.e.f. 01-04-1989 17. Omitted vide Section 64 of the Finance Act, 1999 w.e.f. 01-06-1999 before it was read as, Explanation .-An intimation sent to the assessee under sub-section (1) or sub-section (1B) shall be deemed to be an order for the purposes of sections 246 and 264. Earlier , Inserted vide Section 46 of the Finance (No. 2) Act, 1991 w.e.f. 01-10-1991 And was Amended vide Section 37 of the Finance Act, 1994 w.e.f. 01-06-1994 18. Substituted vide Section 32 of the Finance Act, 2008 w.e.f. 01-04-2008 before it was read as, 3 [ (1) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142,- ( i ) if any tax or interest is found due on the basis of such return, after adjustment of any tax deducted at source, any advance tax paid, any tax paid on self-assessment and any amount paid otherwise by way of tax or interest, then, without prejudice to the provisions of sub-section (2), an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice of demand issued under section 156 and all the provisions of this Act shall apply accordingly; and ( ii ) if any refund is due on the basis of such return, it shall be granted to the assessee and an intimation to this effect shall be sent to the assessee : Provided that except as otherwise provided in this sub-section, the acknowledgement of the return shall be deemed to be an intimation under this sub-section where either no sum is payable by the assessee or no refund is due to him : Provided further that no intimation under this sub-section shall be sent after the expiry of 4 [ one year from the end of the financial year in which the return is made : ] 5 [Provided also that where the return made is in respect of the income first assessable in the assessment year commencing on the 1st day of April, 1999, such intimation may be sent at any time up to the 31st day of March, 2002. ] (1A) 6 [ **** ] (1B) 7 [ **** ] 19. Substituted vide Section 32 of the Finance Act, 2008 w.e.f. 01-04-2008 before it was read as, Provided that no notice under 10 [ clause ( ii ) ] shall be served on the assessee after the expiry of twelve months from the end of the month in which the return is furnished. 20. Substituted vide Section 25 of the Finance Act, 2011 w.e.f. 01-04-2011 before it was read as, 2011 Earlier , Substituted vide Section 55 of the Finance (No.2) Act, 2009 w.e.f. 01-04-2009 before it was read as, 2009 And was Substituted vide Section 34 of the Finance Act, 2010 w.e.f. 01-04-2011 before it was read as, 2010 21. Substituted vide Section 34 of the Finance Act, 2010 w.e.f. 01-04-2011 before it was read as, scientific research association 21A. Substituted vide Section 34 of the Finance Act, 2010 w.e.f. 01-04-2011 before it was read as, scientific research association 21B. Substituted vide Section 34 of the Finance Act, 2010 w.e.f. 01-04-2011 before it was read as, scientific research association 21C. Substituted vide Section 34 of the Finance Act, 2010 w.e.f. 01-04-2011 before it was read as, scientific research association 22. Inserted vide Section 61 of the Finance Act, 2012 w.e.f. 01-07-2012 22A. Inserted vide Section 61 of the Finance Act, 2012 w.e.f. 01-07-2012 23. Omitted vide Section 68 of the Finance Act 2016 w.e.f. 01-04-2017 before it was read as, or 24. Inserted vide Section 68 of the Finance Act 2016 w.e.f. 01-04-2017 25. Substituted vide Section 68 of the Finance Act 2016 w.e.f. 01-04-2017 before it was read as, 22 [ (1D) Notwithstanding anything contained in sub-section (1), the processing of a return shall not be necessary, where a notice has been issued to the assessee under sub-section (2). ] 26. Substituted vide Section 68 of the Finance Act 2016 w.e.f. 01-06-2016 before it was read as, 8 [ (2) Where a return has been furnished under section 139, or in response to a notice under sub-section (1) of section 142, the Assessing Officer shall,- (i) where he has reason to believe that any claim of loss, exemption, deduction, allowance or relief made in the return is inadmissible, serve on the assessee a notice specifying particulars of such claim of loss, exemption, deduction, allowance or relief and require him, on a date to be specified therein to produce, or cause to be produced, any evidence or particulars specified therein or on which the assessee may rely, in support of such claim: 9 [Provided that no notice under this clause shall be served on the assessee on or after the 1st day of June, 2003; ] (ii) notwithstanding anything contained in clause ( i ), if he considers it necessary or expedient to ensure that the assessee has not understated the income or has not computed excessive loss or has not under-paid the tax in any manner, serve on the assessee a notice requiring him, on a date to be specified therein, either to attend his office or to produce, or cause to be produced, any evidence on which the assessee may rely in support of the return: ] 19 [Provided that no notice under clause (ii) shall be served on the assessee after the expiry of six months from the end of the financial year in which the return is furnished ] 27. Substituted vide Section 58 of the Finance Act 2017 w.e.f. 01-04-2018 before it was read as, and interest 28. Substituted vide Section 58 of the Finance Act 2017 w.e.f. 01-04-2018 before it was read as, and interest 29. Substituted vide Section 58 of the Finance Act 2017 w.e.f. 01-04-2018 before it was read as, or interest 30. Substituted vide Section 58 of the Finance Act 2017 w.e.f. 01-04-2018 before it was read as, or interest 31. Substituted vide Section 58 of the Finance Act 2017 w.e.f. 01-04-2018 before it was read as, 25 [ (1D) Notwithstanding anything contained in sub-section (1), the processing of a return shall not be necessary before the expiry of the period specified in the second proviso to sub-section (1), where a notice has been issued to the assessee under sub-section (2) : Provided that such return shall be processed before the issuance of an order under sub-section (3). ] 32. Substituted vide Section 58 of the Finance Act 2017 w.e.f. 01-06-2016 before it was read as, On the day specified in the notice,- (i) issued under clause ( i ) of sub-section (2), or as soon afterwards as may be, after hearing such evidence and after taking into account such particulars as the assessee may produce, the Assessing Officer shall, by an order in writing, allow or reject the claim or claims specified in such notice and make an assessment determining the total income or loss accordingly, and determine the sum payable by the assessee on the basis of such assessment; (ii) issued under clause ( ii ) of 33. Inserted vide Section 46 of the Finance Act 2018 w.e.f. 01-04-2018 34. Inserted vide Section 46 of the Finance Act 2018 w.e.f. 01-04-2018 35. Inserted vide Section 43 of the Finance (No. 2) Act 2019 w.e.f. 01-04-2007 36. Inserted vide Section 69 of the Finance Act, 2020 w.e.f. 01-04-2020 37. Substituted vide Section 69 of the Finance Act, 2020 w.e.f. 01-04-2020 before it was read as, 31st day of March, 2020 38. Substituted vide Section 4 of the The Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act 2020 w.e.f. 01-04-2021 before it was read as, 2022 39. Inserted vide Section 4 of the The Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act 2020 w.e.f. 01-04-2021 40. Substituted vide Section 39 of the Finance Act 2021 w.e.f. 01-04-2021 before it was read as, one year 41. Substituted vide Section 39 of the Finance Act 2021 w.e.f. 01-04-2021 before it was read as, disallowance of expenditure indicated 42. Substituted vide Section 39 of the Finance Act 2021 w.e.f. 01-04-2021 before it was read as, sections 10AA, 80-IA, 80-IAB, 80-IB, 80-IC, 80-ID or section 80-IE, if 43. Substituted vide Section 39 of the Finance Act 2021 w.e.f. 01-04-2021 before it was read as, six 44. Substituted vide Section 40 of the Finance Act, 2022 w.e.f. 01-04-2022 before it was read as, 12 [Provided that in the case of a- ( a ) 21 [ research association ] referred to in clause ( 21 ) of section 10; ( b ) news agency referred to in clause ( 22B ) of section 10; ( c ) association or institution referred to in clause ( 23A ) of section 10; ( d ) institution referred to in clause ( 23B ) of section 10; ( e ) fund or institution referred to in sub-clause ( iv ) or trust or institution referred to in sub-clause ( v ) or any university or other educational institution referred to in sub-clause ( vi ) or any hospital or other medical institution referred to in sub-clause ( via ) of clause ( 23C ) of section 10, which is required to furnish the return of income under sub-section (4C) of section 139, no order making an assessment of the total income or loss of such 21A [ research association ] , news agency, association or institution or fund or trust or university or other educational institution or any hospital or other medical institution, shall be made by the Assessing Officer, without giving effect to the provisions of section 10, unless- ( i ) the Assessing Officer has intimated the Central Government or the prescribed authority the contravention of the provisions of clause ( 21 ) or clause ( 22B ) or clause ( 23A ) or clause ( 23B ) or sub-clause ( iv ) or sub-clause ( v ) or sub-clause ( vi ) or sub-clause ( via ) of clause ( 23C ) of section 10, as the case may be, by such 21B [ research association ] , news agency, association or institution or fund or trust or university or other educational institution or any hospital or other medical institution, where in his view such contravention has taken place; and ( ii ) the approval granted to such 21C [ research association ] or other association 13 [ or fund or trust ] or institution or university or other educational institution or hospital or other medical institution has been withdrawn or notification issued in respect of such news agency or fund or trust or institution has been rescinded: ] 45. Substituted vide Section 40 of the Finance Act, 2022 w.e.f. 01-04-2022 before it was read as, Provided further 46. Omitted vide Section 40 of the Finance Act, 2022 w.e.f. 01-04-2022 before it was read as, 22A [Provided also that notwithstanding anything contained in the first and the second proviso, no effect shall be given by the Assessing Officer to the provisions of clause ( 23C ) of section 10 in the case of a trust or institution for a previous year, if the provisions of the first proviso to clause ( 15 ) of section 2 become applicable in the case of such person in such previous year, whether or not the approval granted to such trust or institution or notification issued in respect of such trust or institution has been withdrawn or rescinded. ] 47. Inserted vide Section 42 of the Finance Act, 2025 w.e.f. 01-04-2025