What is Assessment under Section 143(3) of Income Tax Act, 1961? What is
Scrutiny Assessment? What is the time Limit to complete scrutiny Assessment?.
Income Tax Assessment Under Section 143(3) of Income Tax Act
Assessment U/s 143(3) is a detailed assessment and is referred to as scrutiny
assessment. At this stage a detailed scrutiny of the return of income will be
carried out. At this stage a scrutiny is carried out to confirm the correctness
and genuineness of various claims, deductions, etc., made by the taxpayer in the
return of income.
Scope of assessment under section 143(3)
The objective of scrutiny assessment is to confirm that the taxpayer has not
understated the income or has not computed excessive loss or has not underpaid
the tax in any manner.
To confirm the above, the Assessing Officer carries out a detailed scrutiny
of the return of income and will satisfy himself regarding various claims,
deductions, etc., made by the taxpayer in the return of income.
Procedure of assessment under section 143(3)
If the Assessing Officer considers it necessary or expedient to ensure that
the taxpayer has not understated the income or has not computed excessive loss
or has not underpaid the tax in any manner, then he will serve on the taxpayer a
notice requiring him to attend his office or to produce or cause to be produced
any evidence on which the taxpayer may rely, in support of the return.
To carry out assessment under section 143(3), the Assessing Officer shall
serve such notice in accordance with provisions of section 143(2).
Notice under section 143(2) should be served within a period of six months
from the end of the financial year in which the return is filed.
The taxpayer or his representative (as the case may be) will appear before
the Assessing Officer and will place his arguments, supporting evidences, etc.,
on various matters/issues as required by the Assessing Officer.
After hearing/verifying such evidence and taking into account such
particulars as the taxpayer may produce and such other evidence as the Assessing
Officer may require on specified points and after taking into account all
relevant materials which he has gathered, the Assessing Officer shall, by an
order in writing, make an assessment of the total income or loss of the taxpayer
and determine the sum payable by him or refund of any amount due to him on the
basis of such assessment.
Time-limit for Completion of Assessment u/s 143(3)
As per section 153, assessment under section 143(3) shall be made
within a period of two years from the end of the relevant assessment