Summary Assessment
Introduction
A Summary Assessment is the automated processing of an Income-tax return by the Centralised Processing Centre (CPC). It verifies arithmetical accuracy, deductions, and tax payments without requiring the taxpayer’s presence or passing a detailed assessment order.
Scope and Process
- All Income-tax returns filed underSection 139or in response to a notice under Section 142(1) are processed by CPC, Bengaluru.
- CPC checks for:
o Arithmetical errors and incorrect claims.
o Losses claimed beyond the due date.
o any such inconsistency in the return, with respect to the information in the return of any preceding previous year, as may be prescribed.
o Disallowance/Income indicated in audit reports but not reflected in returns.
o Disallowance of deductions under Section 10AA and Chapter VI-A (Part C) if the return is filed late.
Meaning of ‘Incorrect Claim’
A claim is considered incorrect if:
- It contradicts another entry in the return.
- Not furnished the required information to substantiate the claim.
- Deduction claimed exceeds the specified statutory limit.
Re-computation of Tax after Adjustments
- The total income is recalculated after necessary adjustments.
- Prepaid taxes, such as advance tax, TDS, TCS, and self-assessment tax, are deducted from the computed liability.
- Interest underSections 234A,234B, and 234C and late filing fees under Section 234F are added if applicable.
Opportunity to Respond
Before making any adjustments, the CPC notifies the assessee and allows 30 days to respond electronically. If no response is received, the adjustment is finalized.
Intimation to the Assessee
- If tax is payable, an intimation (deemed as a Notice of Demand) is issued, requiring payment within 30 days to avoid recovery proceedings.
- If a refund is due, it is processed and credited to the assessee.
- If no tax is payable or refundable, no intimation is issued, and the acknowledgement of the return is deemed as intimation.
Time Limit for Intimation
- CPC must issue an intimation within 9 months from the end of the financial year in which the return is filed.
Appeal Against Intimation
- If dissatisfied with adjustments, the assessee can file an appeal before CIT(A) or make an application for revision.