CA Sandeep Kanoi
ICAI President CA. K. Raghu has shown Happiness over extension of Tax Audit Report Due Date in his Messages to its member dated 22.08.2014. In his Message Mr. CA. k. Raghu has failed to take into account the anguish of fellow members over extension of Tax Audit Report Due date without extension of Income Tax Audit Report Due Date. In his message Mr. Raghu has further not mentioned, If ICAI is working or taking any step towards getting this anomaly removed, Which implies that ICAI is not taking any step to get the ITR due date extended and happy with half hearted step of CBDT.
It is to be noted that ITR cannot be filled without completion of Tax Audit Report as Computation of Income has to take into account the disallowances and adverse comments made by the Tax Auditors. In the absence of Extension of due date of ITR, extension given by CBDT is like Giving with one hand and taking with the other.
Tax Payers and Tax Professionals across the County are not happy with CBDT move to extend due date of Tax Audit Report without simultaneous extension of Due date of Income tax Return Filing. Consequence of such move can be read on following link :- Consequences of Non Filing of ITR on or before 30.09.2014
It has further come to our knowledge that many of the Members of ICAI are in the process of Filing PIL in High Court to get this anomaly removed. Last year too CBDT has initially Extended Only Due date of Tax Audit Report without simultaneous extension of due date of Income Tax Report but later it has extended due date of ITR to match the same with extended due date of Tax Audit Report.
CA Sudhir Halakhandi from Rajasthan says that “ The central Board of Direct taxes by extending the date of filing of TAR without extending the date of filing of Income Tax return have produced a “round square” because practically it is not possible to file ITR without completion of Tax audit. Even the system of Income tax law and the format of ITR do not permit it and date of filing under section 44AB is linked with the date of filing of ITR u/s 139(1). This is all unnecessary meddling with Law which is not a good sign for the future of Direct taxation in India and also it is against the declared policy of the lawmakers “rationalization and simplification of taxation Laws”.”
The changes in the TAR are not so important and urgent to introduce them in the middle of the year and this the basic reason for controversy which has now been exaggerated by the law makers by keeping the date of ITR before the date obtaining and furnishing of tax audit report.
Further there was a blackout on the income tax site for continuous 25 days due to the fact that there was no utility to furnish TAR from 25th July 2014 to 20th Aug 2014 and this should be the sole reason to extend the date of ITR.
Tax Payers and Professionals wants CBDT to remove this anomaly and extend the due for Assessee covered under tax audit provisions for A.Y. 2014-15 to 30th November 2014 from 30th September 2014.
Extract of ICAI Presidents Message is Reproduced below :-
Our Recommendation on Tax Audit Accepted
The CBDT has revised the format of Tax Audit report. However, we felt that despite all the good intent of the CBDT, the timing of the revision was not convenient. Hence we represented to Hon’ble Finance Minister, Revenue Secretary, and Chairman CBDT, expressing our concerns. I am happy to inform you that acting on our recommendation, the CBDT has now extended the due date for obtaining and furnishing of Tax Audit report under Section 44AB for Assessment Year 2014-15 in case of assesses who are not required to furnish report under Section 92E of the Act from 30th September 2014 to 30th November 2014. The CBDT has also clarified that the Tax Audit report under Section 44AB of the Act filed during the period from 1st April 2014 to 24th July 2014 in the pre-revised Forms shall be treated as valid Tax Audit report furnished under Section 44AB of Income-tax Act, 1961.
In the meantime, to enable our members to perform this onerous task efficiently and effectively, we are revising our Guidance Note on Tax Audit under Section 44AB of Income-tax Act, 1961 which will be made available to the members very soon. I wish you all the success in most effective completion of Tax Audits.
Author Bio
CA.KC Agarwal has rightly observed the Departments agony over revenue and filing of loss return. Extention of TAR is a final referandum warning to the slow starters and death knoll to professional lethargy. Any way time earned by extention is wasted as ever before by the extended due date and everyone is happy over discussions and writs and appeals. Income Tax E-Filing websites schema, errors, crash,inefficiency,technology gate crash goes unnoticed as usual and the finance ministry celebrates its winover through following circulars and statistics for demand/collection and no of returns filed.Let us strive our level best within due dates and not to be carried away by these extention hurricanes
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KINDLY REFER TO THE CONTENTS OF THE TAX AUDIT REPORT. PROFIT AND LOSS ACCOUNT AND BALANCE SHEET IS PART AND IS INSEPARABLE PART OF THE TAX AUDIT REPORT. WHEN DATE FOR OBTAINING AND SUBMITTING THE TAX AUDIT REPORT HAS BEEN EXTENDED, IT IS IMPLIED WITHOUT ANY DOUBT THAT DATE OF SUBMITTING THE RETURN HAS ALSO BEEN EXTENDED.FURTHER THE SCHEMA IS SUCH WHICH RESTRICTS SUBMITTING THE RETURN WHERE THE SALES AND GROSS RECEIPTS EXCEEDS RS. 1 CRORES.A CLARIFICATION WILL DEFINITELY COME IN THIS REGARD.
AVINASH MOHAN
ADVOCATE
KANPUR.
MOBILE 9235555130
Dear Sir.
I want to draw attention that we have to make appeal to CBDT to extend the date of ITR also.
Extension of due date of Audit Report is like a breakfast at the time of lunch.
WHEN CBDT HAS FAILED TO PROVIDE ADVERSE COMMENTS (TOTAL OF SECTION WISE WRONG CLAIMS TO GIVE EFFECT IN SCHEDULE TO INCOME-TAX RETURNS) REPORTED IN TAX AUDIT REPORT, THAT RELATES TO RETURN FILED FOR ASSESSMENT YEAR 2013-14, AS AGAINST RTI APPLICATION FILED, AS STATED BY BSKRAO IN THIS BLOG, QUESTION RAISED THAT WHY DUE DATE FOR FILING RETURN IN TAX AUDIT CASES HAS TO BE EXTENDED ?
I Want to clarify certain things which are stated in the above discussion and comments:-
1. In case of returns of un-audited Business assesses there is no requirement to file the profit and loss and Balance sheet figures in the ITR. They can file the return by showing 8% profit on their turnover. The profit and loss account and Balance sheet figures are not required.
2. There was a blackout on IT site since 25th July to 20th August and no ITR were filed in all those 25 days . The lapse of these days can not be connected with the lazyness of professionals.
3. In case of audited assesses , practically ITR can not be filed without completion of audit.
These are the hard facts.
CA V. Sivaraman : Sir, I do respect the forum like this to discuss and share knowledge.My sole concern was to show how Office bearer are acting in isolation… They are among us only and still its hard to believe that they are not bothered.
We all must encourage the good practice in our profession.
CA V. Sivaraman : Sir, I do respect the forum like this to discuss and share knowledge.My sole concern was to show how Office bearer are acting in isolation… They are among us only and still its hard to believe that they are not bothered about the practical aspects.
We all must encourage the good practice in our profession and should discourage the others.We all know that number of private workshops etc are being conducted just because that we could not ask our premier institution yo provide the good material in form of guidance notes etc.How can we say to trainees to restrict the time slot for coaching and get practical knowledge through training.when we ourself have become habitual to these classes which now days known as seminars.
OUR COUNTRIES PRIME MINISTER HIMSELF NOT PENDING ANY FILES & DOING THE THING ON TIME, WHY YOU SELF PROMOTING PROFESSIONALS DOING THE INTIME. IT SHOWS NOTHING BUT LAZYNESS OF PROFESSIONS DOING WORKS.
One fails to understand that without audit , when the Return is uploaded the figure post audit may vary, there can be some additions, disallowances, depreciation, 115JB, 80-IB, 80-IC and lot more deduction may change, how the IT Return can be a true and correct, that too when one has to give a verification that I …. solemnly declare to the best of my knowledge the information given in the return and the schedules thereto……………for AY……
Can’t our learned Office bearers understand such contradictory declaration , it may be true that bureaucrats may not understand but Chartered Accountants are supposed to know !!!!
Only alternate is to file the Return and then revise it if so required post audit report.
TAX AUDIT ISSUE IN CURRENT PERSPECTIVE:
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1. The policy of the department seems THAT it is following the instructions of Finance Ministery who wish that COLLECTION of TAXES should not be DELAYED by extending the date.
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2. Hence DUE DATE of the RETURN FILING is not extended, only filing of AUDIT REPORT has been extended for 2 months.
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3. After analysing the above, I have come to conclusion that :-
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(i) Those who maintain all the details readily available with efficient staff, would be able to file the return in time i.e. by due date with audit reports.
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(ii) Those who don’t maintain all the details and prepare such details when time demands, are required to file the return first and then audit reports later on.
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(iii) If something is required to revise the returns, such cases would be CAUGHT by the department DEEMING that some adjustments are made in the books in last hours to finalize the audit and/or to avoid QUALIFICATIONS in the audit reports.
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(iv) This will HELP department to IDENTIFY cases to select for SCRUTINY.
THANKS AND CONGRATULATIONS FOR THE ATTEMPT AND EFFORTS BY THE ICAI AND ITS PRESIDENT IN GETTING THE DATE EXTENDED FOR TAX AUDIT. NOW MY SMALL QUERY TO THE PRESIDENT AND OTHER HON’BLE MEMBERS OF OUR INSTITUTE.
WHAT IS THE RELEVANCE OF EXTENSION OF DUE DATE FOR TAX AUDIT UNDER SECTION 44AB? I DONOT UNDERSTAND EVEN A BIT OF IT. BECAUSE, I BELIEVE AFTER READING MANY TIMES THE SECTION 44AB, DONOT FIND ANY INDEPENDENT DUE DATE BEING REFERRED TO IN THE SECTION WHICH CAN BE EXTENDED.
IF THERE IS ANY THING I HAD LEFT, I WISH THE FELLOW MEMBERS OF MY FRATERNITY TO PLS UPDATE ME AS I MAY BE LACKING IN UNDERSTANDING THE DUE DATE.
ACCORDING TO THE PROVISION OF SECTION 44 AB, A TAX AUDIT REPORT IS REQUIRED TO BE OBTAINED FROM A QUALIFIED ACCOUNTANT & TO BE FILED AS PER THE ACT, BEFORE THE SPECIFIED DATE.
IN EXPLANATION, THE SPECIFIED DATE IS REFERRED TO ANOTHER SECTION OF THE ACT i.e. 139 (1) WHICH COVERS ABOUT THE REGULAR DUE DATES OF FILING RETURN OF INCOME FOR VARIOUS CATEGORIES OF TAX PAYERS ACROSS THE COUNTRY.
NOW THE ACTUAL DUE DATE FOR ASSESSEES COVERED UNDER THE PROVISIONS OF SECTION 44 AB reading with reference to SECTION 139 (1) IS 30th SEPTEMBER 2014 FOR ASST YEAR 2014. NOW THE SPECIFIED DUE DATE OF SECTION 44 AB REFERS ONLY TO THE DATE PRIOR TO THE CBDT CIRCULAR WAS ONLY 30.09.2014; HOWEVER, THE EXTENSION OF DUE DATE TO 30.11.2014, INDIRECTLY REFERS TO SPECIFIED DATE AS PER SECTION 139 (1).
MORESO, UNDER SECTION 119 OF THE INCOME TAX ACT, 1961, CBDT IS EMPOWERED TO EXTEND DUE DATE OF SECTION 139 (1) ONLY AND NOT ANY OTHER DATE(S). REFERRING TO THE POWERS OF CBDT, SHALL WE MEAN THAT THE DUE DATE FOR FILING ITR IS ALSO EXTENDED.
A BILLION DOLLAR QUESTION UN-ANSWERED TILL DATE BY ICAI, CBDT OR FIN MIN.
I think we all are mixing the two things viz. preparation of income tax return and doing audit of the assessee’s books as per Income Tax Audit.
The views are surprising to state that without audit we can not prepare the Income Tax Computation. How the Income Tax Returns of the assessees who are not require to audit under Income Tax gets prepared and filed ?. Are the preparation of Computation of Income is dependent on the findings in Audit or every Assessee is required to prepare Computation of Income as per the provisions of Income Tax Act and Rules.
The allowances and disallowances are not applicable to the assessees who are not required to get their accounts audited ?. How we consider all these and prepare the Computation of Income and Return in their cases ?
I agree that CBDT shold modify return forms to remove the compulsory fields of mentioning the date of audit report and date of submission of audit report and the compulsion to fill sheet of other information to enable assessee liable for tax audit to file returns smoothly.
has anybody written directly to CBDT, request professional brothers and sisters to pls write directly to CBDT and Chief Commissioners. may be the issue will get resolved.
Is the Finance Department and the ICAI aware of the boil over the issue of extension of due date of filing the audit report without the extension for filing the return. Or do they think that the controversy is not at all necessary as the returns cannot be submitted without first uploading the audit report and therefore there is no controversy.
The Tax department should realise that there is a genuine apprehension on the issue and this should be resolved as soon as possible. Why is the Finance Department not doing some thing about it. It seems that they are not aware of the constroversy. Or is it that they do not bother about it.
Why grant an extention if it is not really intended to operate.
sir, the message of the ICAI is like “when Roam was burning………..”,When through out the country is trying for a proper clarification and the discussion is going on as to whether the date of ITR is also extended, whether it is mandatory to attach the copy of the tax audit report with the return and whether the return will be defective if no tax audit report is attached to the ITR, and in the Form 3 CD both the date of audit and date of furnishing of the audit report has to be mentioned. The CBDT is not giving proper clarification in the matter.Kindly awake the CBDT as it is September. the issue which requires immediate cure by CBDT one should not have expressed like this.
With no reservations the opinions expressed by CA Sandeep Kanoi and CA
sudhir Halakhandi are acceptable. The CBDT should wake up after a long sleep and give proper clarification immediately.
It seems that Legacy of P.Chidambarma,our ex Finance Minister still prevails in the CBDT to harass the members of the ICAI. It is nothing but putting cart before horse.They feel that the tax audit compliance is the sole responsibility of the members of the ICAI in the first place ignoring the fact that it is the assessee who has to obtain the tax audit report. I wonder how the ICAI president has expressed his happiness when the members are crying for foul play of the CBDT. How can the members of the ICAI be partners in the nation building when they are forced to act in the extraneous circumstances created by the CBDT.
Kindly don’t follow up this matter with CBDT the way President have made effort in this regard.
efforts should be made only in case of extension of ITR Due dates.
My reply to CA president on his message:
Dear Sir,
Good Morning.
While you are on a road if you are struck with flash flood, then “only” when you cross over to the other side you would be deemed to have crossed the hurdle.
How do we file return without 3cd?
How do u expect an assessee / ca to give future date of audit certificate?
Half done with problem still unsolved / unresolved does not definitely in my opinion deserve any pat on the back of the institute.
Regards
CA V. Sivaraman
PS: Dear advocate/CA friends do not make this forum to debate your personal/professional grievences / vendatta. Let this forum be only share knowledge and help each other.
i want to draw the attention of C A Sandeep ji, that in case the date of filing the income tax return has been extended, then no body shall deposit the self assessed tax , before the extended due date, then in that case the target of collecting the income tax may also extended up to Nov. and I feel that the finance ministry may not be agree to meet target of collection in Nov, therefore the date of income tax return has not been extended. Now i FEEL that the audit of loss cases should be completed within Sept, so the return of losses may be filed before 30-9-2014, to get the benefit of losses. Moreover in other cases also, the estimated self tax should also be deposited before sept.
C A K C AGARWAL< ALLD
ICAI office bearer are away from practical aspects..number of office bearer hardly had any sound background for practice..it seems more like a student union or like uneducated politicians…
Just would like to bring it to notice that the practice of providing guidance notes etc also seems to be stopped…reason they wish all members to attend the seminars and workshops which also provide the so called CPE hours….we all go to such seminars but the what we get there is that the time allocated for the purposed topic used to be minimum and majority of time slots are allocated to chairman etc even MLA etc do get time…all use that platform for advertisement…. And then they put it as image for grabbing the clients…
All this is at the cost of normal CA who wish to be away from the politics and work complying the ICAI norms even with respect to CPE hours….
Pls Change the thoughts… We all are professionals can better understand the topics from books etc…. Spare us to discuss the problem through brain storming….