Time limits for completion of Income Tax Assessment
As per Finance Bill 2017
Table of Time limits for completion of Income Tax Assessment
| Section | Particulars | Applicable from | Time limit |
| 139(5) | Time limit for furnishing revised return | Assessment year 2018- 19 and onwards | Up to the end of the relevant assessment year or before the completion of assessment, whichever is earlier |
| 153(1) | Time limit for making assessment under section 143 or 144 | Assessment year 2017- 18 or before | 21 months from the end of the assessment year in which the income was first assessable. |
| Assessment year 2018- 19 | 18 months from the end of the assessment year in which the income was first assessable. | ||
| Assessment year 2019- 20 and onwards | 12 months from the end of the assessment year in which the income was first assessable | ||
| 153(2) | Time limit for making assessment under section 147 | If notice is served before 01-04-2019 | 9 months from the end of the financial year in which the notice under section 148 was served
|
| If notice is served on or after 01-04-2019 | 12 months from the end of the financial year in which notice under section 148 is served
| ||
| 153(3) | Time limit for making a fresh assessment in pursuance of an order passed under section 254 or 263 or 264 | If order is received / Passed before financial year 2019-20 and onwards | 9 months from the end of the financial year in which order under section 254 is received or order under section 263 or 264 is passed by the authority
|
| If order is received /passed on or after financial year 2019-20 | 12 months from the end of the financial year in which order under section 254 is received or order under section 263 or 264 is passed by the authority
| ||
| 153(5) | Time limit for making fresh assessment where an order under section 250 or 254 or 260 or 262 or 263 or 264 requires verification of any issue by way of submission of any document or where an opportunity of being heard is to be provided to the assessee. | With effect from the 1st day of June, 2016 | Order shall be made within the time specified in 153(3) |
| 153B | Time limit for completion of assessment in case of search or requisition u/s 153A | Time limit for completion of assessment in case of search or requisition (if search conducted in the financial year 2017-18 or before). | 21 months from end of the financial year in which last of authorisations for search or requisition under section 132A was executed
|
| If search conducted in the financial year 2018-19 | 18 months from end of the financial year in which last of authorisations for search or requisition under section 132A was executed
| ||
| If search conducted in the financial year 2019-20 or onwards | 12 months from end of the financial year in which last of authorisations for search or requisition under section 132A was executed
| ||
| 153C. | Time limit for assessment or reassessment in case of other person referred to in section 153C. | If search is conducted in financial year 2017-18 or before | Period available to make assessment or reassessment in case of person on whom search is conducted or 9 months from the end of the financial year in which books of account or documents or assets seized or requisitioned are handed over to Assessing Officer having jurisdiction over such other persons,, whichever is later
|
| If search is conducted in financial year 2018-19 or after | Period available to make assessment or reassessment in case of person on whom search is conducted or 12 months from the end of the financial year in which books of account or documents or assets seized or requisitioned are handed over to Assessing Officer having jurisdiction over such other persons , whichever is later
| ||
| 245HA | Time limit for completion of assessment where a proceeding before the Settlement Commission abates under section 245HA | w.e.f 01.04.2017
| 1 year after the exclusion of the period under 245HA(4) and where such period of limitation is less than one year, it shall be deemed to have been extended to one year |
Relevant Note on Clause 55 of Finance Bill 2017 : Reducing time for filing revised return
Clause 55 of the Bill seeks to amend section 139 of the Income-tax Act relating to return of income.
Sub-section (4C) of the said section mandates filing of return by certain entities which are exempted under section 10.
It is proposed to amend the said sub-section so as to provide that any person referred to in clause (23AAA), Investor Protection Fund referred to in clause (23EC) or clause (23ED), Core Settlement Guarantee Fund referred to in clause (23EE) and Board or Authority referred to in clause (29A) of section 10 shall also be mandatorily required to file return of income.
Sub-section (5) of the said section 139 provides that a person can furnish a revised return, in case he discovers any omission or wrong statement in his return of income already furnished, within one year from the end of the relevant assessment year or before completion of assessment, whichever is earlier.
It is proposed to amend the said sub-section (5) so as to provide that the time for furnishing of revised return shall be available upto the end of the relevant assessment year or before the completion of assessment, whichever is earlier.
These amendments will take effect from 1st April, 2018 and will, accordingly apply in relation to assessment year 2018-2019 and subsequent years.
Relevant Note on Clause 58 of Finance Bill 2017 : Time limits for completion of assessment, reassessment and re-computation
Clause 58 of the Bill seeks to amend section 153 of the Income-tax Act relating to time-limit for completion of assessment, reassessment and recomputation.
The said section provides for time-limit for completion of assessment, reassessment and recomputation in certain cases mentioned therein.
It is proposed to amend sub-section (1) of the said section to provide that for the assessment year 2018-2019, the time- limit for making an assessment order under section 143 or 144 shall be reduced from existing twenty-one months to eighteen months from the end of the assessment year, and for the assessment year 2019-2020 and onwards, the said time-limit shall be twelve months from the end of the assessment year in which the income was first assessable.
It is further proposed to amend sub-section (2) of the said section to provide that the time-limit for making an order of assessment, reassessment or recomputation under section 147, in respect of notices served under section 148 on or after the 1st day of April, 2019 shall be twelve months from the end of the financial year in which notice under section 148 was served.
It is also proposed to amend sub-section (3) of the said section to provide that the time-limit for making an order of fresh assessment in pursuance of an order passed or received in the financial year 2019-2020 and onwards under section 254 or 263 or 264 shall be twelve months from the end of the financial year in which order under section 254 is received or order under section 263 or 264 is passed by the authority referred therein.
It is also proposed to amend the third proviso to Explanation 1 of the said section to omit the reference of section 153B therein.
These amendments will take effect from 1st April, 2017.
It is also proposed to amend sub-section (5) of the said section to provide that where an order under section 250 or 254 or 260 or 262 or 263 or 264 requires verification of any issue by way of submission of any document by the assessee or any other person or where an opportunity of being heard is to be provided to the assessee, the time-limit relating to fresh assessment provided in sub-section (3) shall apply to the order giving effect to such order.
It is also proposed to amend sub-section (9) of the said section to provide that where a notice under sub-section (1) of section 142 or sub-section (2) of section 143 or section 148 has been issued prior to the 1st day of June, 2016 and the assessment or reassessment has not been completed by such date due to exclusion of time referred to in Explanation 1, such assessment or reassessment shall be completed in accordance with the provisions of section 153 as it stood immediately before its substitution by the Finance Act, 2016.
These amendments will take effect retrospectively from 1st June, 2016.
Relevant Note on Clause 60 of Finance Bill 2017 – Time limits for completion of search assessment
Clause 60 of the Bill seeks to amend section 153B of the Income-tax Act, 1961 relating to time-limit for completion of assessment under section 153A.
Clause (a) of sub-section (1) of the said section provides that in respect of each assessment year falling within six assessment years referred to in clause (b) of sub-section (1) of section 153A, the order of assessment or reassessment shall be made within a period of twenty-one months from the end of the financial year in which the last of the authorisations for search under section 132 or for requisition under section 132A was executed.
It is proposed to amend the above clause to provide that the time-limit for assessment and reassessment as specified therein shall also apply in respect of the relevant assessment year referred to in sub-section (1) of section 153A.
The proposed amendment is consequential to the amendment to section 153A of the Income-tax Act.
It is further proposed to amend sub-section (1) to provide that for search and seizure cases conducted in the financial year 2018-2019, the time-limit for making an assessment order under section 153A shall be reduced from existing twenty-one months to eighteen months from the end of the financial year in which the last of the authorisations for search under section 132 or for requisition under section 132A was executed. It is further proposed that for search and seizure cases conducted in the financial year 2019-2020 and onwards, the said time-limit shall be further reduced to twelve months from the end of the financial year in which the last of the authorisations for search under section 132 or for requisition under section 132A was executed.
It is also proposed to provide that period of limitation for making the assessment or reassessment in case of other person referred to in section 153C, shall be as available in case of person on whom search is conducted or twelve months from the end of the financial year in which books of account or documents or assets seized or requisitioned are handed over under section 153C to the Assessing Officer having jurisdiction over such other persons, whichever is later.
It is also proposed to insert a proviso to the Explanation of the said section so as to provide that where a proceeding before the Settlement Commission abates under section 245HA, the period of limitation available under this section for assessment or reassessment shall after the exclusion of the period under sub-section (4) of section 245HA shall not be less than one year; and where such period of limitation is less than one year, it shall be deemed to have been extended to one year.
These amendments will take effect from 1st April, 2017.
It is also proposed to amend sub-section (3) of the said section to provide that that where a notice under section 153A or section 153C has been issued prior to the 1st day of June, 2016 and the assessment has not been completed by such date due to exclusion of time referred to in the Explanation, such assessment shall be completed in accordance with the provisions of this section as it stood immediately before its substitution by the Finance Act, 2016.
This amendment will take effect retrospectively from 1st June, 2016.
Relevant Note on Clause 78 of Finance Bill 2017 -settlement of cases -Time specified for making assessment
Clause 78 of the Bill seeks to amend section 245A of the Income-tax Act relating to definitions for the purposes of Chapter XIX-A relating to settlement of cases.
Clause (b) of the said section provides definition of “case”. Clause (iv) of the Explanation to the said clause (b) provides that unless as otherwise specified, in case where no assessment is made, proceedings shall be deemed to have concluded on the expiry of two years from the end of the relevant assessment year.
It is proposed to amend the said clause (iv) to the Explanation so as to provide that conclusion of proceedings shall be construed in accordance with the time specified for making assessment under sub-section (1) of section 153.
The proposed amendment is consequential to the amendment to section 153 and section 153B of the Income- tax Act.
This amendment will take effect from 1st April, 2017.
Books on Budget 2017-18
Taxmann’s Budget 2017-18 -Book
Budget 2017-18- Notifications on Central Excise , Customs and Service tax – New Book
Ajit Prakashan’s Union Budget 2017-18 -New Book
BDP’s Customs Law Manual (2017-18 Budget Editon with CD) -New Book
Related Post on Budget 2017-18
Budget Speech 2017-18 -Download /Print
Finance Bill 2017 -Download /Print -Budget 2017-18