Amendment of section 143.
34. In section 143 of the Income-tax Act,-
(a) in sub-section (1),––
(i) in the second proviso, for the words “one year”, the words “nine months” shall be substituted;
(ii) in clause (a),––
(I) in sub-clause (iv), for the words “disallowance of expenditure indicated”, the words “disallowance of expenditure or increase in income indicated” shall be substituted;
(II) in sub-clause (v), for the words, figures and letters “sections 10AA, 80-IA, 80-IAB, 80-IB, 80-IC, 80-ID or section 80-IE, if”, the words, figures and letters ‘section 10AA or under any of the provisions of Chapter VI-A under the heading “C.-Deductions in respect of certain incomes”, if’ shall be substituted;
(b) in sub-section (2), in the proviso, for the word “six”, the word “three” shall be substituted.
Notes on Clauses:
Clause 34 of the Bill seeks to amend section 143 of the Income-tax Act relating to assessment.
Sub-clause (iv) of clause (a) of sub-section (1) of section 143 of the said Act provides for adjustment on account of disallowance of expenditure indicated in the audit report but not taken into account in calculating the total income of the assessee.
It is proposed to amend the said sub-clause so as to allow for the adjustment on account of increase in income indicated in the audit report but not taken into account in computing the total income.
Sub-clause (v) of clause (a) of sub-section (1) of the said section provides that any deduction admissible under sections 10AA, 80-IA, 80-IAB, 80-IB, 80-IC, 80-ID or section 80-IE, shall be allowed if the return of income is furnished on or before the due date specified under sub-section (1) of section 139 of the Act.
It is proposed to amend the said sub-clause so as to provide that any deduction admissible under section 10 AA or under any of the provisions of Chapter VIA under the heading “C.-Deductions in respect of certain incomes” shall be allowed, if the return of income is furnished on or before the due date specified under the sub-section (1) of section 139 of the said Act.
It is also proposed to amend the said section so as to reduce the time limit specified for sending intimation under sub-section (1) from one year to nine months and to reduce the time limit for sending notice under sub-section (2) from six months to three months from the end of the financial year in which the return is furnished.
These amendments will take effect from 1st April, 2021.
