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Self assessment tax paid during scrunity 143(2)

Rahul Singh (Accountant) (27 Points)

31 January 2025

Will the Self assessment tax paid during scrunity 143(2) be subtracted for penalty calculations under 270A

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Rama chary Rachakonda (Master in Accounts & high court Advocate email ID:ramachary64@gmail.com voice no:9989324294) (7957 Points)
Replied 31 January 2025

To determine if the self-assessment tax paid during scrutiny under Section 143(2) will be subtracted for penalty calculations under Section 270A, let's break down the relevant provisions: Section 143(2) This section deals with the scrutiny of returns.

During the scrutiny process, if additional income is detected, the assessee may be required to pay self-assessment tax.

Section 270A This section provides for the imposition of penalties for underreporting or misreporting of income. Penalty Calculation under Section 270A The penalty under Section 270A is calculated as a percentage of the amount of tax payable on the underreported or misreported income. Now, regarding the subtraction of self-assessment tax paid during scrutiny: -

_Self-Assessment Tax_: The self-assessment tax paid during scrutiny under Section 143(2) is considered as tax paid before the issuance of the notice under Section 143(2). -

_Penalty Calculation_: As per the CBDT Circular No. 12/2016, dated May 20, 2016, the self-assessment tax paid before the issuance of the notice under Section 143(2) can be adjusted while calculating the penalty under Section 270A.

In summary: - The self-assessment tax paid during scrutiny under Section 143(2) can be subtracted for penalty calculations under Section 270A. - The adjustment is allowed as per the CBDT Circular No. 12/2016. Please consult a tax expert or chartered accountant to ensure accurate interpretation and application of these provisions.

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Rahul Singh (Accountant) (27 Points)
Replied 31 January 2025

Thanks for the reply but I can't find any such CBDT circular on income tax website. There is a circular dated 30 May 2016 but talks about different context https://cleartax.in/v/it/income-tax-circulars/circular-no-12-2016-admissibility-of-claim-of-deduction-of-bad-debt-under-section-361vii-read-with-section-362-of-the-income-tax-act-1961-30-may-2016/

Can you share the circular link / pdf which you have quoted in the reply? Thanks in advance!

Rahul Singh (Accountant) (27 Points)
Replied 31 January 2025

Can anyone share any practical experiences of assessees related to this

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