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INCOME TAX AND GST

Module II
Income tax authorities in India
 Central board of direct taxes
 Director general of income tax
 Director of income tax
 Additional director general of income tax
 Joint director of income tax
 Deputy director of income tax
 Assistant director of income tax
 Income tax officers
 Tax recovery officers
Central Board of Direct Taxes (CBDT)
It is the highest authority of income tax department. It makes rules and
issues instructions and directions to other income tax authorities.
General Powers and functions of income tax authorities
1. Power to call for information.
2. Power to requisition of books of Accounts.
3. Power to search and seizure.
4. Power regarding discovery of evidence.
5. Power to collect certain information.
6. Power to inspect company registers.
7. Power of survey.
8. Power to disposal of appeal.
Advance payment of tax
The assessee is required to pay tax on current income by installments
during the financial year itself is called advance payment of tax.
Tax deduction at source (TDS)
TDS is income tax reduced from the money paid at the time of making
specified payments by the person making such payments.
Incomes applicable to TDS
 Salaries
 Interest on securities
 Dividend
 Insurance commission
 Winning from lotteries
 Payment of NSS
Recovery of tax
The process of recovering arrears of tax, interest, penalty or any other
sum payable under the Act.
Modes of recovering tax
 Certificate to tax recovery officer
 Attachment of salary
 Garnishee order
 From a court
 Sale of movable property
 Recovery through state government
Income tax return
The statement in which the assessee disclose the details of his income
during the previous year is called income tax return.
Different kinds of income tax return (Essay)
1. Voluntary return
If a person files the return on his own according to Income Tax Act
before the due date is known as voluntary return.
2. Belated return
It is a return which is filed after the stipulated date mentioned in the
income tax rule.
3. Revised return
A person filed income tax return before due date but later on any
omission or wrong statement are found. The assessee can revise the
file again is known as revised return.
4. Return of loss
If a person is having negative income i.e.; losses are eligible for carry
forward for next years. Such loss can be used to reduce the tax liability
during current assessment year. This is known as return of loss.
5. Compulsory return
When a person files a return in response to the notice given by the
assessing officer is known as compulsory return.
6. Defective return
Where the assessing officer considers the return furnished by the
assessee is defective. He may give 15 days to rectify the defects. Such
return is called defective return.
Signing of the return
 Individual-Individual himself
 HUF- Karta
 Company-Managing director
 Firm-Managing partner
 Political party- Chief executive officer of such party
 Local authority- Principal Officer
 Association- Member of association
Manners of furnishing the return of income
 Electronically under digital signature.
 Transmitting data through electronic verification code.
 Filing of return through computer readable media.
 Filing of return through tax return preparer.
 Filing of return himself or through an agent.
PAN
Permanent account number is a number which is used to identify each
assessee regarding the tax matters. PAN has 10 alphanumeric
characters and issued in form of laminated card.
PAN is compulsory in the following cases
 Income exceeds exemption limit.
 Liable to pay tax on behalf of other person.
 Sale or purchase of immovable property.
 Opening a demat account.
 Application of debit card or credit card.
 Purchase of bank draft exceeding RS. 50000.
Assessment
It means computation of the total income and determination of tax
payable by the assessee.
Procedure of assessment of income tax
1. Filing the return of income tax.
2. Computation of taxable income of the assessee.
3. Determination of some payable by the assessee.
4. Making of the assessment order and issue notice of demand
specifying the sum payable by the assessee.
Classification/ Types of assessment (Essay)
 Self-assessment
 Assessment on the basis of return
 Regular assessment
a) Assessment on the basis of evidence
b) Best judgement assessment
 Re assessment
 Precautionary assessment
Self-assessment
The assessee himself compute the total income, tax liability and
submitting after paying tax is known as self-assessment.
Assessment on the basis of return
Where return has been filed by an assessee, assessing officer will assess
income of the person keeping in view of relevant provision, such
assessment is called assessment based on return.
Regular assessment
It means the assessment made on the basis of evidence or best
judgement assessment.
Assessment on the basis of evidence
A detailed assessment of an income tax return filed by a tax payer is
called scrutiny assessment or assessment on the basis of evidence.
Best judgement assessment
It is an assessment by the assessing officer to the best of his judgement
after taking into account all relevant material which he has collected.
Re-assessment (Income escaping assessment)
An income is said to have escaped assessment when it has not been
charged to tax in the original assessment year to which it rightly
belongs.
Precautionary assessment
In certain cases it is difficult to determine has to whom the income
pertains. The assessing officer can commence proceedings to
determine the question as who is responsible to pay tax. Such an
assessment is called precautionary assessment.

Prepared by
RAHUL MURALI
JUBAIR MAJEED

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