For an assessment to be valid, the notice u/s 148 of Income Tax Act, for Assessment must be served on Assessee or his Authorized representative. As an Assessee, you always have the right to dispute the Assessment Order, if the service of notice was not done properly. Highlight of the case is that though Assessee never raised this point during Assessment, ITAT still allowed the appeal of the Assessee on this ground. It was clearly held that the person to whom the notice was served should have direct authority to receive the notice and not an implied one.

During my years of Income Tax practice, I have developed very strong feelings that all Assessing Officers must COMPULSORILY be sent for business training in some trading or industrial houses to know the fact of the game. In fact the whole edifice of Income Tax in our country is based on assumption that the businessman is a cheat that is out to evade tax at any cost.

Income Tax Act provides for clubbing of income of spouses in certain cases where it is presumed that income of one spouse is being transferred to other’s name to cut down the tax liability.

Lack
of clarity and guidance on the filing of Annual Information Return (AIR) and
income-tax return (ITR) forms have to lead to a great disparity in information
provided by the Assessee. In such a scenario, there could be an increase in the
number of people getting notice from the income-tax department, feel tax
experts. According to experts, the mismatch could arise in case of credit card
payments, investments in units, shares and debentures, purchase or sale of

Returns of Income Tax have to be filed within stipulated time and for any delay in filing returns with in given time, penalty u/s 271 B is levied by the Assessing Officer. The Assessee who is supposed to get his accounts audited also needs to submit his audit report along with filing of the return.

In the case of Oriental Medicines (P.) Ltd, vs Assistant Commissioner of Income-tax, Circle-1, Alleppey, ITAT Cochin Bench pronounced a very healthy decision that is bound to bring cheer to defaulters who file their return late.

When an Assessee holds a different view on a particular issue and accordingly claims a benefit which is not allowed by the Assessing Officer, it does not automatically become concealment of income.

In case of Auric Investment & Securities Ltd, the Assessee declared its income from brokerage and other income against which it had claimed share trading loss. Assessing Officer found that loss was speculative in nature and could be adjusted against Assessee’s normal income.

Quite often our
investment decisions are based on premise that the returns on the instrument
are not subject to deduction of TDS at source. For the past two years, while
banks have been giving better returns than Post Offices, still significant
number of investors had been preferring Post office deposits as the same were
not subject to deduction of TDS.

Filing an appeal against the orders of Assessing Officers is becoming quite an expensive affair. Filing an appeal entails filing of statutory fees, some times part of income tax demand and of course you have to pay professional charges to your consultant.

Quite often, a particular addition by an assessing officer is not protested by the Assessee for very simple reason that the demand of income tax raised towards that reason does not warranty the expensive litigation costs. This can prove quite expensive mistake some times.

CBDT has announced the following procedure
for selection of cases for 'Scrutiny' for non-corporate Assessees during the
current financial year i.e. 2007-08 This means the returns filed by Assessees
for financial year 2006-07 would be selectd on the following basis.