taxadmin Reassessment quashed for change of opinion is now a settled position in income-tax law. Courts have repeatedly held that where an issue was examined during original assessment, reopening under Section 148 based on the same material is impermissible. If there is no fresh tangible material, reassessment fails. Legal issue involved Whether reassessment proceedings are valid … Read more
Avoid excess TDS, DTAA errors, and Section 201 litigation Section 195 TDS governs tax deduction at source on payments made to non-residents and applies only where the income is chargeable to tax in India. Statutory Scope of Section 195 Section 195 of the Income-tax Act governs deduction of tax at source on payments made to … Read more
Section 263 revision allows the Principal Commissioner to revise an assessment order.But every erroneous order is not revisable. Statutory Preconditions for Invoking Section 263 Section 263 does not give unfettered powers to the Principal Commissioner. The provision is jurisdictional in nature and can be invoked only if the twin statutory conditions are satisfied simultaneously: Both … Read more
Penalty u/s 270A vs 271AAC is a common area of confusion in income-tax penalty proceedings. Though both provisions deal with penalties, they apply to different situations, operate under different conditions, and carry different consequences. Understanding the distinction is critical for both taxpayers and practitioners. What the Law Says – Penalty u/s 270A vs 271AAC They … Read more
Penalty show cause notice is often issued mechanically along with or after assessment proceedings. A properly drafted reply, without casual admissions or unnecessary explanations, can prevent levy of penalty at the threshold stage itself. Nature of Penalty Proceedings Penalty proceedings are separate and independent from assessment proceedings. Merely because an addition has been made in … Read more
AIS TIS mismatch is increasingly resulting in income-tax additions and automated notices. In most cases, these mismatches arise due to reporting or timing issues and can be resolved online without resorting to litigation, provided timely and accurate action is taken. Why AIS TIS Mismatch Arises How AIS and TIS Data Is Generated AIS (Annual Information … Read more
Section 154 allows correction of mistakes apparent on record. It is powerful—but limited. Particular Section 154 Rectification Appeal (CIT(A)) Revision (Section 264) Nature Correction of mistake apparent on record Challenge to assessment/addition Discretionary relief by Commissioner Scope Very limited Wide Wide but discretionary Can decide debatable issues ❌ No ✅ Yes ❌ No Evidence allowed … Read more
Reassessment time barred is one of the strongest jurisdictional grounds to challenge reopening proceedings. Courts have consistently held that reassessment notices issued beyond the prescribed limitation period are void ab initio, irrespective of merits. If limitation fails, jurisdiction fails. Legal Issue Involved in Reassessment Time Barred Cases Whether reassessment proceedings are valid when: Courts have … Read more
Defective return under Section 139(9) is a problem faced by many taxpayers. Receiving a notice stating that your income-tax return is defective under section 139(9) often causes unnecessary anxiety. Many taxpayers assume it is a serious default or that penalties will follow immediately. In reality, a defective return notice is procedural, not punitive, and in … Read more
Reassessment based on audit objection has repeatedly been struck down by courts where the Assessing Officer has acted mechanically without forming an independent belief. Indian courts have consistently held that an audit opinion cannot substitute the statutory requirement of “reason to believe” for reopening assessments. Reassessment proceedings are frequently initiated on the basis of audit … Read more