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What does Self Assessment tax means

Nehas (Al) (425 Points)

25 September 2009

What does Self Assessment tax mean?

Where it is to be entered in ITR 4

and

is any provision made to pay it

if yes

provision for same entry

and till when it has to be paid for every assessee

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4 Replies

sumit (CHARTERED ACCOUNTANT) (479 Points)
Replied 25 September 2009

provision is always made for gross amount taxable including interest and that should be paid through advance tax which is before 31st mar. and self assesment which is after 31st march but before 30th sep.

Sunil Liladhar Kotak (Manager (F & A)) (2025 Points)
Replied 26 September 2009

pls visit following link to the wordings of the act itself mad feel free to ask any furhter query if u want.

https://www.vakilno1.com/bareacts/incometaxact/s140a.htm

Thanks, Sunil

HITESH (CA STUDENT) (50 Points)
Replied 26 September 2009

Hi Neha,

Have a nice day!

Section 140A

Self-assessment

Levy of penalty is not automatic but discretionary - Though section 140A uses the word ‘shall’, the entire provision must be read harmoniously and reasonably. This being a taxing provision and a penal provision, the court has to give effect to a plausible interpretation which is in favour of the citizen, where two plausible views are permissible. Otherwise, it will lead to anomaly and hardship to the assessee. So construed, sub-section (3) of section 140A provides a reasonable opportunity of being heard to the assessee which is mandatory. Once the law mandates that opportunity is to be given to the assessee to explain the default, if the explanation offered by the assessee is found to be satisfactory, then the question of imposing penalty would not arise. In other words, an amount of discretion is vested with the authority to impose or not to impose the penalty based on the explanation offered by the assessee. He is empowered in his discretion in appropriate cases to exonerate the assessee from the liability to pay any amount towards penalty if he is satisfied, on consideration of the facts and circumstances, that there was sufficient or reasonable cause for the assessee for his inability to pay the entire amount or part thereof within the time stipulated under law. To hold otherwise, would render the proviso to sub-section (3) of section 140A redundant. Therefore, the penalty [under section 140A(3)] is not an automatic consequence of a default and the penalty will follow only in the event of the assessee failing to show reasonable cause for non-payment of the tax as required by the section - Ramachandra Pesticides (P.) Ltd. v. CIT [2006] 155

Thanking You,

HITESH

Max Payne (employed) (2569 Points)
Replied 26 September 2009

Originally posted by :Neha
"	What does Self Assessment tax mean? Where it is to be entered in ITR 4 and is any provision made to pay it if yes provision for same entry and till when it has to be paid for every assessee	"

Self assessment tax is the tax paid by the assessee after the end of that previous year. If you pay the tax relating to 2008-09 in april 2009, then u pay it as Self assessment tax - in simple words, tax as per your assessment.

If you pay the same tax for 2008-09 in january 2009, then it becomes advance tax.

You enter the S A T in advance tax and SAT paid schedule.

Since you used the word entry, i assume you mean accounting treatment. The provision for tax will be the tax liability as per income tax act. Show the same as Provision in Balance Sheet. TDS and advace tax if any comes on the Current assets side.

Finally u pay the difference between Provision for tax and TDS/Advance taxes - this is self assessment tax. U may have to pay some interest for any delays.

Hope its clear