Rationalisation of prima-facie adjustments during processing of return of income
Sub-section (1) of the section 143 provides for processing of return of income made under section 139, or in response to a notice under sub-section (1) of section 142.
Clause (a) of the said sub-section provides that at the time of processing of return, the total income or loss shall be computed after making the adjustments specified in sub-clauses (i) to (vi) thereof.
Sub-clause (vi) of the said clause provides for adjustment in respect of addition of income appearing in Form 26AS or Form 16A or Form 16 which has not been included in computing the total income in the return.
With a view to restrict the scope of adjustments, it is proposed to insert a new proviso to the said clause to provide that no adjustment under sub-clause (vi) of the said clause shall be made in respect of any return furnished on or after the assessment year commencing on the first day of April, 2018.
This amendment will take effect from 1st April, 2018 and will, accordingly, apply in relation to the assessment years 2018-2019 and subsequent years.
Extract of Clause 44 of Finance Bill 2018
Clause 44 of the Bill seeks to amend section 143 of the Income-tax Act relating to assessment.
Clause (a) of sub-section (1) of the said section provides that at the time of processing of return of income made under section 139, or in response to a notice under sub-section (1) of section 142, the total income or loss shall be computed after making the adjustments specified in clauses (i) to (vi) therein.
Sub-clause (vi) of the said clause provides for adjustment in respect of addition of income appearing in Form 26AS or Form 16A or Form 16 which has not been included in computing the total income in the return.
It is proposed to insert a new proviso to the said clause so as to provide that no adjustment under sub-clause (vi) of the said clause shall be made in respect of any return furnished for the assessment year commencing on or after the 1st day of April, 2018.
It is further proposed to insert sub-sections (3A), (3B) and (3C) in the said section so as to, inter alia, provide for a scheme, by notification in the Official Gazette, for the purpose of making assessment of total income or loss of the assessee under sub-section (3).
These amendments will take effect from 1st April, 2018.
