What is assessment under section 143(1)? || Scope of assessment under section 143(1)

What is assessment under section 143(1)?

​​​​​​Scope of assessment under section 143(1)

​​Assessment under section 143(1) of Income tax Act is like preliminary checking of the return of income. At this stage no detailed scrutiny of the Income tax return of income is carried out. At this stage, the total income or total loss is computed after making the following adjustments (if any), namely:-

(i) any arithmetical error in the Income tax return; or ​

(ii) an incorrect claim, if such incorrect claim is apparent from any information in the ITR; ​

(iii) disallowance of loss claimed, if Income tax return of the previous year for which set off of loss is claimed was furnished beyond the due date specified under sub-section (1) of section 139 of this act of Income tax return

(iv) disallowance of expenditure indicated in the audit report but not taken into account in computing the total income in the income tax  return;​

(v) disallowance of deduction claimed under sections 10AA, 80-IA, 80-IB, 80-IC, 80-ID or section 80-IE of Income Tax Act, if the return is furnished beyond the due date specified under sub-section (1) of section 139 of Income tax act; or

(vi) addition of income appearing in Income tax Form 26AS or Form 16A or Form 16 which has not been included in computing the total income in the Income Tax Return. ​

However, no such adjustments shall be made unless an intimation is given to the Income tax  assessee of such adjustments either in writing or in electronic mode.

Further, the response received from the Income tax assessee, if any, shall be considered before making any adjustment in ITR, and in a case where no response is received within 30 days (thirty) of the issue of such intimation by income tax department, such adjustments shall be made.

For the above purpose “an incorrect claim apparent from any information in the Income tax return” means a claim on the basis of an entry in the Income Tax return: –

(i) of an item which is inconsistent with another entry of the same or some other item in such Income Tax Return;

(ii) in respect of which the information is required to be furnished under this Act to substantiate such entry and has not been so furnished; or

​(iii) in respect of a deduction in ITR. where such deduction exceeds specified statutory limit which may have been expressed as monetary amount or (%) percentage or ratio or fraction.