Regarding to Tax audit for A.Y. 2021-22

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This discussion addresses a tax audit query for A.Y. 2021-22 where an accountant incorrectly reported partner interest and remuneration. The department raised a demand because these items were shown in the capital account and clause 16a of Form 3CD, but not in the Income Tax Return. Despite two rectification attempts, the department hasn't considered them. The conversation explores the possibility of revising tax audit reports under specific circumstances like amended accounts or laws, and mentions a rule allowing revisions for changes under sections 40 and 43B until the end of the assessment year.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)

23 August 2022 whether Tax audit for A.Y. 2021-22 is revised?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

24 August 2022 What is the reason for the revision?

Suresh S. Tejwani

Suresh S. Tejwani (Querist)

24 August 2022 Accountant had shown Partners interest, remuneration in capital account and reported in 3CD form under clause 16a and not reported in Income Tax return under sl. no. 5(a) of part A OI. hence, Department has raised demand for that.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

24 August 2022 In that case it cannot be revised.
Check if rectification of ITR can be filed.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)

24 August 2022 We had filed rectification two times but department has not consider it and raise the same demand

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

24 August 2022 As per guidance not of ICAI .... that the accounts can be amended to 44AB must not get amended in a regular way. But often a time the member might be needed to amend his tax audit report upon the basis like:

The amendment of the company accounts post its adoption in the AGM.
The amendment of the law is like the retrospective amendment.
Revision in interpretation, like. CBDT’s circular, judgments, and others...
Any additional cause such as the system or software issues needed the amendment in the report which was uploaded formerly.

Here you can check applicability of last option....

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

24 August 2022 The Income Tax (Eighth Amendment) Rules, 2021 has inserted sub-rule (3) in rule 6G vide towards the issues faced by assesses because of the provisions of section 40 and section 43B of the Act through Notification No. 28/2021 dated 1.4.2021, w.e.f. 1.4.2021.
But it provides the option for revision for any change u/s 40 or sec. 43B, only till the end of the assessment year.

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