Variance notice section 143(1)(a)
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
19 July 2018
The notice is about disallowance of expenditure indicated in audit report but not taken into account in computing total income in ITR u/s 143(1)(a)(iv)
.Particulars: As per ITR As per Tax Audit
Report
Inconsistency in amount 0 say 2/- lac
disallowable under section 40(a)(i),
on account of non compliance with the
provisions of chapter xvii-B sec 40
Query: How to rectify this inconsistency? We have mentioned erroneously amount under column of section 40(a)(i) instead of 40(a)(ia)in tax audit report. We have uploaded revised audit report by correctly mentioning amount under column 40(a)(ia). Whether we need to revise ITR also since there is no mistake in ITR.
How to answer the query when the below mentioned 3 options are coming:
1.Agree (file revised ITR return)
2.Partially Agree (file revised ITR return)
3.Disagree (Response).
.Particulars: As per ITR As per Tax Audit
Report
Inconsistency in amount 0 say 2/- lac
disallowable under section 40(a)(i),
on account of non compliance with the
provisions of chapter xvii-B sec 40
Query: How to rectify this inconsistency? We have mentioned erroneously amount under column of section 40(a)(i) instead of 40(a)(ia)in tax audit report. We have uploaded revised audit report by correctly mentioning amount under column 40(a)(ia). Whether we need to revise ITR also since there is no mistake in ITR.
How to answer the query when the below mentioned 3 options are coming:
1.Agree (file revised ITR return)
2.Partially Agree (file revised ITR return)
3.Disagree (Response).
19 July 2018
Option 1 agree and revise both return and audit report.
Message likes :
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Querist : Anonymous
Querist :
Anonymous
(Querist)
19 July 2018
We have already revised ITR once earlier and for this we again need to revise the return. Which date and acknowledgement no. should be mentioned in the 2nd revised return? i.e. whether of original or 1st revised return.
Also after uploading revised tax audit report against this query, in the revised ITR which date of audit report should be mentioned, whether original or revised audit report.?
Also after uploading revised tax audit report against this query, in the revised ITR which date of audit report should be mentioned, whether original or revised audit report.?
19 July 2018
1 Original.
2 Revised audit report.
2 Revised audit report.
Message likes :
1 times
Querist : Anonymous
Querist :
Anonymous
(Querist)
19 July 2018
Thank you so much for quick reply.
If we mention revised audit report date in ITR which is after the due date,then whether there is any chances of penalty provisions to be imposed for late filing of audit report?
If we mention revised audit report date in ITR which is after the due date,then whether there is any chances of penalty provisions to be imposed for late filing of audit report?
02 August 2025
Great question — and it's a common concern in such cases.
Let’s walk through this clearly.
---
### 🧾 **Background of Your Case:**
* A notice under **section 143(1)(a)(iv)** was received due to a **mismatch between the ITR and Tax Audit Report** regarding **disallowance under section 40(a)(i)**.
* The issue was a **reporting error**: the amount was wrongly reported under **40(a)(i)** instead of **40(a)(ia)** in the **Tax Audit Report**.
* The ITR was **correct** all along.
* You have **already revised the Tax Audit Report** to reflect the correct section (40(a)(ia)).
* Now, you are considering whether to file a **second revised return**, and if so, what **dates and acknowledgement numbers** to quote.
---
## ✅ Your Main Queries — Answered:
### 1. **Do you need to revise the ITR again?**
**No**, technically you do **not** need to revise the ITR again **if the ITR was originally correct** and only the **Tax Audit Report had the mistake**.
But, practically, to **avoid mismatch flags**, it's **advisable** to file a **second revised return**, especially since the notice requires a response under 143(1)(a).
---
### 2. **While revising ITR (second time), what acknowledgment number and date should be used?**
* **Use the acknowledgment number and date of the *first revised return*** as the reference in the second revised return.
* So in the second revision, you're **referring to the first revised return**, **not the original**.
> 📌 **In the ITR form,** when it asks “Whether original or revised return was filed earlier?”, select **“Revised”** and provide the **ack. no. and date of 1st revised return**.
---
### 3. **What date of the audit report to mention in the revised ITR?**
* **Mention the date of the revised Tax Audit Report** (i.e., the correct one).
* Even if it's **after the due date**, that's fine, as **you’re filing it to correct an error**, not as a fresh audit.
---
### 4. **Will there be any penalty for delay in filing the audit report if the revised audit report is dated after the due date?**
* **No penalty** should apply **if the original audit report was filed on time**.
* The revised report is **only a correction**, not a new audit.
* There is **no separate penalty** for revising a tax audit report **unless**:
* The original was not filed on time.
* Or the revision is due to willful misreporting.
> 📌 **CBDT has clarified** that **revised audit reports** filed to correct genuine mistakes (like clerical errors) **do not attract penalty**, **as long as the original was filed on time**.
---
### ✅ Suggested Steps to Respond:
1. **Option 3: Disagree** — You may choose this **if the ITR was always correct**, and the error was only in the audit report, **and you've already revised the audit report**. Add a note explaining this.
2. **Or Option 1: Agree and file 2nd revised return** — safer route if you want to fully align ITR and audit report. Reflect the correct audit report date.
Either option is acceptable based on how cautious you want to be.
---
### 📄 Sample Explanation (if you choose “Disagree”):
> “The inconsistency arose due to an inadvertent clerical error in the Tax Audit Report where disallowance was shown under section 40(a)(i) instead of 40(a)(ia). The ITR filed reflects the correct computation. The Tax Audit Report has been revised accordingly. Hence, the disallowance proposed under section 143(1)(a)(iv) is not applicable.”
---
Let me know if you’d like help drafting a formal response or explanation.
Let’s walk through this clearly.
---
### 🧾 **Background of Your Case:**
* A notice under **section 143(1)(a)(iv)** was received due to a **mismatch between the ITR and Tax Audit Report** regarding **disallowance under section 40(a)(i)**.
* The issue was a **reporting error**: the amount was wrongly reported under **40(a)(i)** instead of **40(a)(ia)** in the **Tax Audit Report**.
* The ITR was **correct** all along.
* You have **already revised the Tax Audit Report** to reflect the correct section (40(a)(ia)).
* Now, you are considering whether to file a **second revised return**, and if so, what **dates and acknowledgement numbers** to quote.
---
## ✅ Your Main Queries — Answered:
### 1. **Do you need to revise the ITR again?**
**No**, technically you do **not** need to revise the ITR again **if the ITR was originally correct** and only the **Tax Audit Report had the mistake**.
But, practically, to **avoid mismatch flags**, it's **advisable** to file a **second revised return**, especially since the notice requires a response under 143(1)(a).
---
### 2. **While revising ITR (second time), what acknowledgment number and date should be used?**
* **Use the acknowledgment number and date of the *first revised return*** as the reference in the second revised return.
* So in the second revision, you're **referring to the first revised return**, **not the original**.
> 📌 **In the ITR form,** when it asks “Whether original or revised return was filed earlier?”, select **“Revised”** and provide the **ack. no. and date of 1st revised return**.
---
### 3. **What date of the audit report to mention in the revised ITR?**
* **Mention the date of the revised Tax Audit Report** (i.e., the correct one).
* Even if it's **after the due date**, that's fine, as **you’re filing it to correct an error**, not as a fresh audit.
---
### 4. **Will there be any penalty for delay in filing the audit report if the revised audit report is dated after the due date?**
* **No penalty** should apply **if the original audit report was filed on time**.
* The revised report is **only a correction**, not a new audit.
* There is **no separate penalty** for revising a tax audit report **unless**:
* The original was not filed on time.
* Or the revision is due to willful misreporting.
> 📌 **CBDT has clarified** that **revised audit reports** filed to correct genuine mistakes (like clerical errors) **do not attract penalty**, **as long as the original was filed on time**.
---
### ✅ Suggested Steps to Respond:
1. **Option 3: Disagree** — You may choose this **if the ITR was always correct**, and the error was only in the audit report, **and you've already revised the audit report**. Add a note explaining this.
2. **Or Option 1: Agree and file 2nd revised return** — safer route if you want to fully align ITR and audit report. Reflect the correct audit report date.
Either option is acceptable based on how cautious you want to be.
---
### 📄 Sample Explanation (if you choose “Disagree”):
> “The inconsistency arose due to an inadvertent clerical error in the Tax Audit Report where disallowance was shown under section 40(a)(i) instead of 40(a)(ia). The ITR filed reflects the correct computation. The Tax Audit Report has been revised accordingly. Hence, the disallowance proposed under section 143(1)(a)(iv) is not applicable.”
---
Let me know if you’d like help drafting a formal response or explanation.
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