Faceless Assessment Introduction Faceless Assessment ensures electronic processing of Scrutiny Assessments (Section 143(3)), Best Judgment Assessments (Section 144), and Reassessments (Section 147). This eliminates physical interaction between taxpayers and tax authorities, except for cases excluded from faceless assessment. Scope of Faceless Assessment All assessments, reassessments, or recomputations under Sections 143(3), 144, and 147 are conducted facelessly, except in cases:… Read More »

Scrutiny Assessment Introduction Scrutiny Assessment is a detailed examination of an Income-tax return to ensure that the assessee has correctly reported income and paid taxes. It may be Limited Scrutiny, focusing on specific issues, or Complete Scrutiny, covering the entire return. A notice must be served within 3 months from the end of the financial… Read More »

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… Read More »

Faceless Inquiry or Valuation Introduction The Faceless Inquiry or Valuation Scheme, 2022, was introduced to eliminate direct interaction between taxpayers and Income-tax authorities. It applies to notices under Section 142, special audits, inventory valuation, and valuation by a Valuation Officer under Section 142A. Scope of the Scheme Under Section 142B, the scheme covers: Issuance of notices underSection 142(1)& 142(2) for… Read More »

Estimation of Value of Assets by Valuation Officer Introduction The Assessing Officer (AO) may refer a case to a Valuation Officer to estimate the value or fair market value of any asset, property, or investment for assessment or reassessment. The Valuation Officer must submit the report within six months from the end of the month… Read More »

Special Audit and Inventory Valuation under Income-tax Introduction The Assessing Officer (AO) may direct an assessee to get accounts audited or inventory valued if the complexity of accounts, volume of transactions, or nature of business necessitates such action. This power is exercised in a faceless manner. Conditions for Special Audit or Inventory Valuation The AO… Read More »

Enquiry before Assessment Introduction The Assessing Officer (AO) is empowered to conduct an enquiry to obtain complete information regarding a taxpayer’s income or loss. The AO can issue notices, direct special audits, or refer matters to a Valuation Officer. These powers are exercised in a faceless manner. Powers of the Assessing Officer Notice to File… Read More »

Self-Assessment Introduction Self-assessment requires an assessee to compute taxable income and tax liability before filing the Income-tax return. Failure to discharge this obligation may result in being treated as an assessee-in-default. Computation of Income and Tax Self-assessment involves calculating total income under the five heads of income: Salary House Property Profits and Gains of Business… Read More »

ASSESSMENT OF INCOMES Introduction Income-tax assessment involves verifying and reviewing the information furnished by the assessee in the Income-tax return. The Income-tax Act prescribes various types of assessments, including Self-Assessment, Summary Assessment, Scrutiny Assessment, Best Judgment Assessment, and Income Escaping Assessment. Types of Assessment The term ‘assessment’ refers to the examination of a return of… Read More »