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Accounting professionals move court for clarity on CBDT's tax filing deadline
September, 11th 2014

Some accounting professionals in the country have sought legal intervention to bring clarity into a recent directive from the Central Board of Direct Taxes (CBDT) extending deadline for furnishing the tax audit report without making any change in the deadline for filing the income-tax return.
The CBDT had on July 25 extended the due date for filing the tax audit report (TAR) under Section 44AB of the Income Tax Act 1961, for assessment year 2014-15 to November 30 from the earlier date of September 30. It, however, did not refer to the income-tax return (ITR).

"We decided to slug it out in courts since written representations and emails to authorities concerned, including the finance ministry, CBDT and apex professional institutes, went unheeded," said a Delhi-based chartered accountant. "Discussion on various public fora as well as writing on social media did not elicit response," said the professional, refusing to be named.

Accounting professionals said a Delhi High Court bench has admitted a writ petition filed by Mahesh Kumar & Co, a Delhi-based chartered accountant firm, and the matter will be heard on September 15. Tax professionals and taxpayers in other parts of the country, too, are likely to move courts as they feel the CBDT directive has added to confusion rather than providing any relief. "It is not clear whether the due date for filing ITR under Section 139 of the Income Tax Act in cases where tax audit is applicable has also been extended," said Paras Kochar, president of Direct Taxes Professionals' Association, which represents about 1,300 tax professionals in Kolkata.

According to the Income Tax Act 1961, the deadline for filing the ITR is the same as that for filing TAR.For some assessees, it has been September 30 and for others, November 30.

A section of chartered accountants say that the due date for furnishing TAR under Section 44AB and the that for filing the ITR where the assessees are required to get their accounts audited under Section 139(1) cannot be detached from each other. "Therefore, there cannot be an amendment of the deadline for filing the TAR without a corresponding amendment of the due date for filling ITR," said chartered accountant Kamal Nayan Jain, president of Association of Corporate Advisers and Executives.

Technically speaking, the ITR can be filed without tax audit report, but this action is neither advisable nor practical as a taxpayer has to compute total income after taking into consideration various deductions which are based on the tax audit report. "If an assessee files the ITR without the TAR, he will have to file a revised return that will only multiply the workload of the income-tax department,"said Alok Gupta, director of taxation at Delhi-based chartered accountant firm SS Kothari Mehta & Co.

S Santhanakrishnan, central council member of the Institute of Chartered Accountants of India, said any change in details required in tax filings should be made available for a given year only if notified prior to March 31. "Changes notified thereafter could be made applicable from the subsequent years. This will avoid last-minute rush and also requests for postponement of filing dates from assesses and accounting professionals," he said.

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