Income of earlier years
This query is : Resolved
22 April 2014
Query 1
Very old liabilities are appearing in a Balance sheet since 15 years.Can the income tax assessing officer treat these old liabilities as income of the current year? Is there any case law in our support?
Query 2
Like wise, Can an assessing officer treat the income of earlier years (say 10 years back income) as the income of current year as the plea that such an income has escaped assessment in the earlier year?
Please guide me in the above issues
Very old liabilities are appearing in a Balance sheet since 15 years.Can the income tax assessing officer treat these old liabilities as income of the current year? Is there any case law in our support?
Query 2
Like wise, Can an assessing officer treat the income of earlier years (say 10 years back income) as the income of current year as the plea that such an income has escaped assessment in the earlier year?
Please guide me in the above issues
27 April 2014
yes, under section 41(1) AO can treat liability as income. As proof under income tax act is to be maintained for 8 years you might get stuck up there to prove it in case u do not have proof.
No AO cannot assessee 10 years back income as for income escapement assessment he has only powers of 6 years.
however recent amendment gives power to reopen cases of past 16 yrs if you fall under conditions given under new provisions.
No AO cannot assessee 10 years back income as for income escapement assessment he has only powers of 6 years.
however recent amendment gives power to reopen cases of past 16 yrs if you fall under conditions given under new provisions.
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