1. REVISED TAX AUDIT REPORT UNDER SECTION 44AB OF THE INCOME TAX ACT 1961 CA MUKESH BANSAL

2. Provisions of Section 44AB of the Income Tax Act CA MUKESH BANSAL A proper audit for tax purposes would ensure that the books of accounts and other records are properly maintained, that they faithfully reflect the income of the tax payer and claims for deduction are correctly made by him. To reflect true income To facilitate the tax administration Will save time of the Tax Officer. The time of the assessing officer thus saved, could be utilized for attending to more important investigational aspects of a case.

3. Categories of Persons covered CA MUKESH BANSAL Turnover Criteria – Businessmen's; – Professionals Presumptive Tax -assesses declaring lower profits; Profit Reporting Criteria -from 1.4.2011 under Section 44AB(2)

4. WHO SHOULD GET THEIR BOOKS OF ACCOUNTS AUDITED U/S 44AB CA MUKESH BANSAL Sales / Gross Turnover or Gross Receipts exceed Upto A.Y 2010-11 A.Y 2011-12 & A.Y 2012-13 A.Y 2013-14 BusinessRs 40 LacsRs 60 LacsRs 1 Crore ProfessionRs 10 LacsRs 15 LacsRs 25 Lacs Audit u/s 44AB is necessary where assessee claims profits from Business @ less than 8%, where Sec 44 AD is applicable. where assessee claims profits is lower than specified U/s 44AE, 44BB or 44BBB.

5. REVISED TAX AUDIT REPORT FORMATS CA MUKESH BANSAL Notification no. 33/2014 dated 25.07.2014 Revised the format of Tax Audit Form 3CA-3CD, Form 3CB-3CD,; Applicable for the Financial Year 2013-14 (Assessment Year 2014-15); Existing utility of Tax Audit Forms stands withdrawn; All assesses to submit the Report in the Revised Format. Has 41 clauses for reporting, notified vide 7 th amendment in Rules.

6. Why Amendment? CA MUKESH BANSAL As part of a national strategy to boost revenue receipts; The Department has processed data about high value TDS defaults in the last seven years and is planning to reach out to corporate houses and auditors to explain the ramifications of non- compliance. From 2007-08 onwards, TDS defaults have risen to Rs. 26,000 crores;

7. Major Changes CA MUKESH BANSAL 9 New Clauses added; Scope of Reporting in many clauses expanded; Tabular Formats introduced for reporting in certain clauses; New Format requires Auditor to give more elaborate report on various aspects Annexure in Part B giving Two Year’s Data removed

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9. How to use this form CA MUKESH BANSAL This utility can be run on operating systems like Windows 7.0 or above and latest Linux, where Java Runtime Environment Version 7 Update 6 (jre 1.7 is also known as jre version 7) or above is installed. Please make sure you're connected to the internet before and after preparing the form for submission. The following are features available in the Form. New - Click on this button, to open a new Form. Open - This option is for importing the XML (successfully generated earlier) from your hard disk. Select the path and import the XML. This option will work irrespective of any version change. It will caution you to check the contents before finalizing upload/submission. Save - You can save your completed XML in the desired path/location of your desktop. Save Draft - This option can be used to save your XML. Please note you cannot upload an XML which was saved using the "Save draft" option. Only a complete XML generated using the "Save" option can be uploaded successfully. Previous/Next - These will help you to navigate to the various tabs of the ITR form. Preview-Print - This option is used to view/print the form in browser.

10. System settings CA MUKESH BANSAL Following are the recomended settings to use the ITR Utility : Softwares: Java Runtime Environment Version 7 Update 6 (jre 1.7 is also known as jre version 7) or above Any Zip Software to unzip the utility Internet Connection: Minimum bandwidth of 256 kbps and above

11. Short Keys CA MUKESH BANSAL S.No. ActionShort Key 1 Alt + N Opens a new Form 2 Alt + S Saves the Form in the user desired path 3 Alt + F4 Closes the utility 4 Alt + I Imports the XML file 5 Alt + C Clears the validation errors 6 Alt + D Hides/Shows the validation window 7 Alt + F1 Opens the help page 8 ALT + A Save Draft

12. Changes in the main Report CA MUKESH BANSAL Different Utilities for 3CA-3CD and 3CB-3CD; Improved Formats with Tables in all the clauses with option to select from drop down boxes for Sections including subsections; Attached notes to be referred in the main report; Signature Field for Auditor modified; Qualifications required to be given in a Tabular Format from the Drop Down Boxes and Corresponding Observations/Qualifications to be given by the Auditor;

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14. Details of Auditor & Signatures CA MUKESH BANSAL

15. Option to Import Data enabled – Depreciation Schedule 18; – Amount Inadmissible under Section 40(a), TDS etc. (Clause 21);

16. CA MUKESH BANSAL Instructions for Updating the data Option-1 Import CSV Download the template Click on the template; provide a file name to save the CSV. Update the data as per the headings provided in the CSV template. Option 2-Fill Data“- as earlier also Note: 1. All the imported files should only be in.CSV format. 2. To modify / Delete any of the records, Re-Import the new corrected.CSV file. 3. To avoid incorrect data, Taxpayer should use either"Option 1- Import CSV" or "Option 2-Fill Data".

17. Other Changes in utility CA MUKESH BANSAL Tabular Format for books of accounts maintained, place where the books have been kept and the books of account examined; Drop Down boxes provided for Presumptive profits; Import from CSV file is now possible Preview and Printing Option enabled; Printing Formats much better that earlier version

18. Clause No. – 4 (New Clause) CA MUKESH BANSAL Whether the assessee is liable to pay Indirect tax like excise duty, service tax, sales tax, customs duty, etc. if yes, please furnish the registration number or any other identification number allotted for the same REMARKS This clause is newly inserted in revised 3CD. In existing 3CD, there was no as such requirement. Tin No, St Reg No., Excise Reg No. Etc (Whichever applicable) has to be mentioned. Purpose is to cross verify the data reported to Other departments.

19. Clause 6 (OLD -5) CA MUKESH BANSAL Previous year from……………..to …………… Amended to Include the date of commencement of previous year for newly started business

20. Clause No. – 8 (New Clause) CA MUKESH BANSAL Indicate the relevant clause of section 44AB under which the audit has been conducted Specify whether audit is under clause (a), (b), (c) or (d) of section 44AB

21. Relevant clauses as given in utility CA MUKESH BANSAL

22. Clause No – 11 CA MUKESH BANSAL Whether books of account are prescribed under section 44AA, if yes, list of books so prescribed. NO CHANGE List of books of account maintained and the address at which the books of accounts are kept. (In case books of account are maintained in a computer system, mention the books of account generated by such computer system. If the books of accounts are not kept at one location, please furnish the addresses of locations along with the details of books of accounts maintained at each location.) List of books of account and nature of relevant documents examined.

23. CA MUKESH BANSAL Place of business includes where the books of accounts are kept Information is useful for department for the purpose of survey u/s 133-A If more than one place than give detail of all places obtain details from auditee regarding location Section 2(12A)- Books of accounts includes ledgers, day books, cash books and any other books

24. CLAUSE NO 12 CA MUKESH BANSAL Whether the profit and loss account includes any profits and gains assessable on presumptive basis, if yes, indicate the amount and the relevant section (44AD, 44AE, 44AF, 44B, 44BB, 44BBA, 44BBB, Chapter XII-G, First Schedule or any other relevant section.) Chapter – XII-G and First schedule is included now

25. Clause - 13(c) CA MUKESH BANSAL 13 (C). Where there is a change in method of accounting employed vis-a-vis the method employed in Immediately preceding previous year, details of such change and effect thereof on profit and loss to be indicated in specific format Complete details regarding Items having impact on profits shall be given Serial numberParticularsIncrease in profit (Rs.) Decrease in profit (Rs.)

26. Clause - 14(b) CA MUKESH BANSAL In case of deviation from the method of valuation prescribed u/s 145A, and the effect thereof on the profit or loss to be indicated in specific format Complete details regarding Items having impact on profits shall be given Serial No.ParticularsIncrease in Profit (Rs.) Decrease in Profit (Rs. )

27. Clause -17 CA MUKESH BANSAL Where any land or building or both is transferred during the previous year for a consideration less than value adopted or assessed or assessable by any authority of a State Government referred to in Section 43CA or 50C, Please furnish :- Details of PropertyConsideration received or accrued Value adopted or assessed or assessable

28. CA MUKESH BANSAL Huge reporting & examination required in case of assessee engaged in real estate sector Any land or building or both are covered (rural agriculture land too) Reporting required for property appearing in books only If the property is transferred for a consideration at or more than the stamp value, this clause shall not apply.

29. CA MUKESH BANSAL In case of transaction through power of attorney, ratio deal, ask for valuation certificate, if not available than take representation letter from assessee & appropriate disclosure of this fact to be made. If consideration received in installments, reporting to be made in the year in which transfer of property took place Cross verification from 26-AS

30. CA MUKESH BANSAL SectionAmount debited to P/L Account Amounts admissible as per the provisions of the Income Tax Act, 1961 and also fulfils the conditions, if any specified under the conditions, if any specified under the relevant 14provisions of Income Tax Act, 1961 or Income Tax Rules,1962 or any other guidelines, circular, etc., issued in this behalf.

31. CA MUKESH BANSAL Section 32AC, 35AD, 35CCC and 35CCD also included in admissible amounts. For all above sections, if any condition is attached under circulars, rules etc, such conditions also to be reported. 33AC section has been deleted in the new 3CD. Breakup of admissible amounts u/s 35 is asked now.

32. Clause - 20(b) CA MUKESH BANSAL Details of contributions received from employees for various funds as referred to in section 36(1)(va) : Serial number Nature of fund Sum received from employees Due date for payment The actual amount paid The actual date of payment to the concerned authorities

33. CA MUKESH BANSAL Caption has been redrafted. Along with due dates, the amount of Employee contribution collected and remitted also to be disclosed.

34. Detailed information to be furnished of amounts debited to profit & loss account, being in nature of capital, personal, advertisement expenditure etc in specified format Clause – 21(a) Nature Sl. No. Particulars Amount (in Rs) CA MUKESH BANSAL

36. i) Payment to Non resident without deduction of tax A. Details of payment on which tax is not deducted: Date of Payment Amount of PaymentNature of payment Name and Address of the Payee (i)(ii)(iii)(iv) Clause - 21{b} B. Details of payment on which tax has been deducted but has not been paid during the previous year or in the subsequent year before the expiry of time prescribed under section 200(1) Date of Payment Amount of Payment Nature of payment Name and Address of the Payee Amount of Tax deducted (i)(ii)(iii)(iv)(v) Amounts inadmissible under section 40(a):- CA MUKESH BANSAL

37. Instead of providing inadmissible expenditure as a Single Amount, detailed breakup of disallowance u/s 40 including non-deduction, short deduction and short/non-payment

38. Clause - 21{b} ii) Payment to resident without deduction of tax (A) Details of payment on which tax is not deducted: Date of Payment Amount of Payment Nature of payment Name and Address of the Payee Amount of Tax deducted (i)(ii)(iii)(iv)(v) (B) Details of payment on which tax has been deducted but has not been paid on or before the due date specified in sub- section (1) of section 139. Date of Payment Amount of Payment Nature of payment Name and Address of the Payee Amount of Tax deducted Amount out of (v) deposited, of any (i)(ii) (iii) (iv)(v)(vi) CA MUKESH BANSAL

39. (iii) under sub-clause (ic) [Wherever applicable] FBT (iv) under sub-clause (iia) Wealth Tax (v) under sub-clause (iib) Royalty from State Government undertaking (vi) under sub-clause (iii) Salary to NRI without TDS Date of Payment Amount of Payment Name and Address of the Payee (i)(ii)(iii) Details as under: (vii) under sub-clause (iv) Payment to employee’s benefit fund TDS not insured (viii) under sub-clause (v) Tax paid on non monetary perquisites CA MUKESH BANSAL

40. Clause - 21{d} Disallowance/deemed income under section 40A(3) (A)On the basis of the examination of books of account and other relevant documents/evidence, whether the expenditure covered under section 40A(3) read With rule 6DD were made by a/c payee cheque or a/c payee bank draft If not, please furnish the details: (B) On the basis of the examination of books of account and other relevant documents/evidence, whether the payment referred to in section 40A(3A) read with rule 6DD were made by account payee cheque drawn on a bank or account payee bank draft If not, please furnish the details of amount deemed to be the profits and gains of business or profession under section 40A(3A): Serial numberDate of payment Nature of payment AmountName and Permanent Account Number of the payee, if available CA MUKESH BANSAL

42. Clause -28 & 29 28. Whether during the previous year the assessee has received any property, being share of a company not being a company in which the public are substantially interested, without consideration or for inadequate consideration as referred to in section 56(2)(viia), if yes, please furnish the details of the same. 29. Whether during the previous year the assessee received any consideration for issue of shares which exceeds the fair market value of the shares as referred to in section 56(2)(viib), if yes, please furnish the details of the same. CA MUKESH BANSAL NEWLY INSERTED

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44. Determination of FMV is as per Rule 11U & 11UA Information to be called from assessee regarding FMV valuation. Added for the purpose of reporting transaction of companies known as briefcase company CA MUKESH BANSAL

45. Clause -31 (c) Whether the taking or accepting loan or deposit, or repayment of the same were made by account payee cheque drawn on a bank or account payee bank draft based on the examination of books of account and other relevant documents (269SS, 269T) CA MUKESH BANSAL

46.  Requirement of obtaining certificate from assessee has been removed  Now reporting to be made on the basis of examination of books & other relevant documents CA MUKESH BANSAL

47. Clause-32(c) & 32 (d) (c) Whether the assessee has incurred any speculation loss referred to in section 73 during the previous year, If yes, please furnish the details of the same. (d) whether the assessee has incurred any loss referred to in section 73A in respect of any specified business during the previous year, if yes, please furnish details of the same. CA MUKESH BANSAL NEWLY INSERTED

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49. In case of a company, please state that whether the company is deemed to be carrying on a speculation business as referred in explanation to section 73, if yes, please furnish the details of speculation loss if any incurred during the previous year. Clause -32(e) CA MUKESH BANSAL NEWLY INSERTED

50. Reporting for speculation loss of companies which makes trading of shares of other companies i.Exclusion for the companies whose GTI mainly consist of interest on securities, Income from House property, Capital gain & other sources. ii.Whose principal business is banking or giving loans & advances. iii.Finance Act 2014 has amended this section and exclusion is also made applicable for the companies whose principal business is share trading CA MUKESH BANSAL

51. Clause -33 Section-wise details of deduction, if any, admissible under Chapter VIA or Chapter III (Sec. 10A, Sec. 10AA) CA MUKESH BANSAL

53. Clause-34 (a) Whether the assessee is required to deduct or collect tax as per the provisions of Chapter XVII-B or Chapter XVII-BB, if yes please furnish : TANSec. Nature of Paymen t Total amount of Payment or Receipt of the nature specified in Col. 3 Total amount on which tax was required to be deducte d or collecte d out of (4) Total amount on which tax was deducted or collected at specified rate out of (5) Amoun t of tax ded. Or coll. Out of (6) Total amount on which tax was deducted or collected at less than specified rate out of (7) Amount of tax deducte d or collecte d on (8) Amount of tax deducted or collected not deposited to the credit of the Central Government out of (6) and (8). (1)(2)(3)(4)(5)(6)(7)(8)(9)(10) BPL…194AINTEREST10000075000500005,000250001250NIL CA MUKESH BANSAL

54. Compliance with TCS provisions Old Form 3CD required reporting on compliance with TDS provisions only. New Form No. 3CD requires reporting on compliance with TCS provisions as well[clause 34(a) of Part B]. In addition to details of TDS/TCS auditor has to disclose -amount short deducted, – TAN of the Assessee, – Amount on which TDS /TCS deducted or collected, – amount paid and – also details of amount of TDS/TCS not paid by the Assessee.

55. CA MUKESH BANSAL The scope of this clause has been expanded and all items attract chapter – XVII-B has been deducted or collected to be reported. Further, All such items attract chapter – XVII-B to be reported section wise. Further portion of such Amount which attract TDS under relevant section, Tax deducted (including specific rate) and amount of non- remittance to government also to be disclosed as per schedule.

56. Clause-34 (b) whether the assessee has furnished the statement of tax deducted or tax collected within the prescribed time. If not, please furnish the details : TAN Type of Form Due Date for furnishin g Date of Furnishing, if furnished. Whether the statement of Tax deducted or collected contains information about all transactions which are required to be reported. (1)(2)(3)(4)(5) CA MUKESH BANSAL NEWLY INSERTED

57. Clause-34 (c) whether the assessee is liable to pay interest under section 201(1A) or section 206C(7).If yes, please furnish: TAN Amount of Interest Payable Amount paid out of Col. (2) Date of Payment (1)(2)(3)(4) CA MUKESH BANSAL NEWLY INSERTED

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59. Clause -36 In the case of a domestic company, details of tax on distributed profits under section 115-O in the following form :- (a)Total amount of distributed profits; (b)Amount of reduction as referred to in section 115-O(1A)(i); (c) Amount of reduction as referred to in section 115-O(1A)(ii); (d) Total tax paid thereon; (e) Dates of payment with amounts CA MUKESH BANSAL

61. Clause-37 Whether any cost audit was carried out, if yes, give the details, if any, of disqualification or disagreement on any matter/item/value/ qty as may be reported/identified by the cost auditor. Clause- 38 CA MUKESH BANSAL

62. Whether any audit was conducted under section 72A of the Finance Act,1994 in relation to valuation of taxable services, Finance Act,1994 in relation to valuation of taxable services, if yes, give the details, if any, of disqualification or disagreement on any matter/item/value/quantity as may be reported/identified by the auditor. Clause-39 CA MUKESH BANSAL

64. Clause - 40 Details regarding turnover, gross profit, etc., for the previous year and preceding previous year : Serial numberParticulars Previous year Preceding previous year 1. Total turnover of the assessee 2.Gross profit/turnover 3.Net profit/turnover 4.Stock-in-trade/turnover 5. Material consumed/ finished goods produced CA MUKESH BANSAL

66. Clause - 41 Please furnish the details of demand raised or refund issued during the previous year under any tax laws other than Income Tax Act, 1961 and Wealth tax Act, 1957 along with details of relevant proceedings. Furnish details of demand raised/refund issued under any other act along with relevant proceeding CA MUKESH BANSAL

67. Thank you CA MUKESH BANSAL