Answer ( 1 )

  1. Scope of assessment under section 143(1)

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

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

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

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

    (iii) disallowance of loss claimed, if 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​

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

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

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

    However, no such adjustments shall be made unless an intimation is given to the assessee of such adjustments either in writing or in electronic mode. Further, the response received from the assessee, if any, shall be considered before making any adjustment, and in a case where no response is received within thirty days of the issue of such intimation, such adjustments shall be made.

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

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

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

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

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