At Sterling tax partners, We offer a bouquet of fully integrated tax and regulatory services. Our extensive experience and in-depth knowledge combined with our insight and innovation helps dynamic businesses in Income Tax assessment & litigation.

Our specialist teams provide a holistic and the most tax-effective solutions for closure of income tax assessment/litigations to large multinational companies, mid-size businesses, high net worth individuals and entrepreneurs looking to grow their businesses.

While handling Income Tax Assessment, our goal is to minimise your business and personal tax exposure by means of legitimate planning and defending the client before tax authorities.

 Various Assessment under Income Tax Act 1961

We at Sterling Tax Partners as part of Income Tax Assessment Services, help to successfully closure of assessment proceeding under various section of Income Tax Act, 1961

Section 143(1): Summary Assessment

Under Section 143(1), assessment is done without human intervention by cross-checking information provided by assessees with details stored by the Income Tax Department. Through summary assessment, one can spot clerical errors and inconsistencies in the ITR. 

However, this is an initial stage of assessment that helps in summarising any arithmetical errors, incorrect claims or disallowances. Thus, this process is carried out before the Income Tax Department sends an intimation letter to taxpayers for refund, error, or adjustment. 

3. Section 143(3): Scrutiny Assessment 

Now we move on to detailed scrutiny of Income Tax Returns filed by taxpayers. An Assessing Officer (AO) performs the role of conducting an inquiry and ensuring the correctness of income details provided by assesses.

For a thorough examination, an AO can demand the books of accounts or certain documents. The aim is to verify that there is no disparity between income earned and tax paid. Thus, an AO analyses whether taxpayers have understated their income or overstated the losses. 

If there is a mismatch, an assessee can pay the extra amount or accept refunds. However, if taxpayers are dissatisfied with the assessment, they can appeal to higher authorities or apply for recitation under Section 154. 

4. Section 144: Best Judgement Assessment

This type of income tax assessment takes place only under circumstances in which a taxpayer fails to cooperate with the IT department. In these cases, an AO has to compute the tax liability of an assessees with the best judgement in mind, without dishonesty. 

Best judgement assessment takes place when:

• Assessees fail to respond to multiple notices issued by the Income Tax Department instructing them to provide certain documents or books of accounts. 
  
  
• Taxpayers do not file income tax returns for the financial year within the due date specified by Central Board of Direct Taxes (CBDT). 
  
  
• Taxpayers fail to comply with special audits or written requests ordered by the Income Tax Department.
  
  
• Assessees do not maintain proper books of accounts. 
  
  
• AO is unsatisfied with the documents or information provided by an assessee. 
  
  

After hearing an assessee’s argument, an AO passes an order based on relevant documents and information known as best judgement assessment. 

5. Section 147: Income Escaping Assessment

Income escaping assessment is considered one of the most critical types of assessment in income tax. When an Assessing Officer believes that a taxpayer’s income has escaped assessment, he/she has the authority to order a reassessment. 

The circumstances under which reassessment takes place are as follows:

• An assessee’s income is taxable, but ITR is not filed 
  
  
• The assessee filed ITR but understates income or overstates losses or deductions
  
  
• When taxpayers do not furnish reports on international transactions 
  
  

The duration of reassessment varies according to how gravely an income has escaped the initial assessment.

What we do at Sterling Tax Partner as part of Income Tax Assessment

Income Tax Assessment services in Gurgaon requires a comprehensive approach involving people with adequate understanding of tax laws and insightful handling of contentious issues. Our services as part of income tax assessment services in India include:

• Our expert at sterling pursues the notice/intimation issued in depth and analyse the requirement sought by officer for income tax assessment.
  
  
• As part of Income tax Assessment services, we discuss list of information required with client
  
  
• We push ourselves and client for information/details as required in notice.

• Tax representation before Assessing Officer and other tax authorities during audit or investigation by the revenue authorities.
  
  
• Advising the client on proper documentation required for income tax assessment services in Gurgaon.
  
  
• Our sterling partners helping to close the assessment as per law either with nil or minimal demand.
  
  
• Complete review of documents received from client as part of income tax assessment services.
  
  
• Attend virtual hearing along with client, if required and assist in providing online clarification for completion of assessment proceeding.
  
  
• Analyse the assessment orders in respect of Company passed by the officer and discussing with Company’s management on course of action required.
  
  
• Diagnostic review of litigation history and assistance in litigation risk analysis

Tax Assessment – Timelines

Assessment timelines

As part of income tax assessment service by Sterling, we also keep an insight on the various timeline under assessment.

Timelines for issuance of notice and passing order under the Indian Income-tax Act are as follows:

* Where the case is referred to the transfer pricing officer, the timelines are extended by 12 months.

Reassessment timelines

Three years from the end of the relevant tax year.

Five years from the end of the relevant tax year where the Tax Officer has evidence of income escaping assessment, represented in the form of assets, amounting to INR 5 million or more.

Notice for reopening to be issued only where Tax Officer has ‘information’ suggesting that the income chargeable to tax has escaped assessment and after obtaining prior approval of specified authority