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After hectic Tax Audit times, for AY 2022-23, now it’s time for some Tax Audit Fun Moments. So, in this article, I am presenting some hilarious Tax Audit QAs/visualisations conceived and visualised by me, which will help You in understanding all important reporting clauses in the Form 3CD Annexure in the Tax Audit Report (TAR), in a funny yet purposeful and useful manner.

Understanding Important Tax Audit Reporting Clauses with Funny QAs

1. Clause 44 of TAR

Tax Auditor to an 'Expense' head: Why are you so upset & angry?

Expense head: I am upset as earlier we all were united under one head. Now you are trying to break us & divide into GST registered/unregistered/composite dealer/ exempt heads, knowing fully that my breakup will not determine my allowability in ITR.

Clause 44 of TAR requires Reporting in the below format

S.No.

Total amount of Expenditure incurred during the year

Expenditure in respect of entities registered under GST

Expenditure relating to Entities not registered under GST

   

Relating to goods or services exempt from GST

Relating to entities falling under Composition Scheme

Relating to Other Registered Entities

Total Payment to Registered Entities

 

(1)

(2)

(3)

(4)

(5)

(6)

(7)

2. Clause 8 of TAR

Que: Why did detective Byomkesh Bakshi get a notice from Income Tax Department?

Ans. Because he has not got his books of accounts tax audited for his consultancy receipts. [Section 271B of Income Tax Act & Clause 8 of TAR].

3. Clause 8a of TAR

Que: Why did Iron Man get a 'New-Pinch' from his Tax Auditor?

Ans: Because he has opted for the New Tax Regime [Clause 8a of TAR].

Clause 8 & 8a of TAR requires reporting in below manner

08

Indicate the relevant clause of section 44AB under which the audit has been conducted

Relevant clause of section 44AB under which the audit has been conducted

08a

Whether the assessee has opted for taxation under section
115BA/115BAA/115BAB/115BAC/115BAD?

No

 

4. Clause 21(b) & 34 of TAR

Que: Why did "Daya-bhav" Foundation, get a qualification in its Tax Audit Report?

Ans: Because guided by its 'daya-bhav' philosophy, it didn't deduct TDS on salary of its employees & other payments. [Clause 21(b) & 34 of TAR].

Clause 21(b) of TAR requires reporting in below manner

Clause 21(b) of TAR

Clause 34 of TAR requires reporting in below manner

Clause 34 of TAR

5. Clause 29B of TAR

Que: Why did 'Balveer' get worried about his Tax Audit Report?

Ans: He has received a Gift from 'Santa', which his Tax Auditor has reported in Clause 29B in his TAR. [Section 56(2)(x)].

Clause 29B requires reporting in below manner

29

B

Whether any amount is to be included as income chargeable
under the head Income from other sources as referred to in clause (x) of sub-section 2 of section 56

 

Nature of Income

Amount

Remarks if any:

 

6. Clause 30C of TAR

Que: Why did Shah Rukh Khan get furious with his Tax Auditor?

Ans. (strictly fictional) He has received some CCDs from Byju's Singapore-based Holding Company, as a free token of love n affection for his "YaadGAAR" contribution in Kids learning and education. [Clause 30C on GAAR].

Clause 30C of TAR requires reporting in below manner:

30

C

Whether the assessee has entered into an impermissible avoidance arrangement, as referred to in section 96 during the previous year (This Clause is kept in abeyance till 31st March,2022)

 
 

Nature of the impermissible avoidance arrangement

Amount (in Rs) of tax benefit in the previous year arising, in aggregate, to all parties to the arrangement

Remarks if any:

 

And the final one....

God to Tax Auditor: Dear hardworking Soul, I am happy with your devotion. Ask anything & I will grant you the same.

Tax Auditor: Dear God, please give me the special power that my digital signature & attachments to my TAR get uploaded glitchfree.

God (puzzled): Vatsa, that is not in my hands, please consult Infosys...


  

Published by

Mayank Mohanka
(Chartered Accountant)
Category Income Tax   Report

1 Likes   0 Shares   13443 Views

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