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BROWSE BY TOPICS HOME INCOME-TAX FORM 3CD – EXPLANATION & APPLICABILITY
Applicability of tax audit

Income Tax e-Filing

FORM 3CD – Explanation & Applicability Tax audit forms

Clause-wise summary of Form 3CD

Last Date To File ITR For 2022-23
Conclusion
Updated on: Oct 27th, 2023 | 36 min read
Income Tax Slabs FY 2023-24

Which Is Better: Old vs New Tax Regime For Salaried

Employees? For a taxpayer, the period between June to September is a particularly stressful period since all the financial data for the last financial

House Property
year needs to be accumulated together and the final tax liability would be determined on the basis of the same.

Business, Professional & Freelance

The ‘Tax Audit’ limit under Section 44AB is Rs 5 crore (the threshold limit is Rs 10 crore where minimum 95% of business transactions are
Which ITR Should I File? done in digital mode). If the taxpayer is subject to audit, then this process is even more elaborate as one not only has to submit a return
Income Tax Refunds but also a tax audit report to the Income Tax authorities. In this context, we whould have heard or come across the ‘Form 3CD’. We will
Paying Tax Due cover the following aspects with regard to Form 3CD.
Salary Income
Latest Update
Capital Gains Income

Other income sources

Advance Tax
The reporting under clause 30C and clause 44 of the tax audit report (form 3CD) has been kept in abeyance till 31st March 2022.

NRI

HUF

Income Tax Notices Applicability of tax audit

To know more about the applicability of tax audit, please read here.
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Clause-wise summary of Form 3CD

Sl. No. Particulars Comments

1 Name of the assessee

These are the basic details included for identification of the
2 Address assessee. It may be noted that if the audit is in respect of a
branch, name and address of such would need to be
Permanent Account Number (PAN) branch should be
3 mentioned.
mentioned along with the name of the assessee.

Whether the assessee is liable to pay indirect tax like

excise duty, service tax, sales tax, goods and services
The registration numbers with the respective tax authorities
4 tax, customs duty, etc. If yes, please furnish the
need to be entered in this clause
registration number, GST number or any other
identification number allotted for the same

This refers to the different classes of assesses included in the

Act – individual, Hindu Undivided Family (HUF), company, firm
5 Status
(includes LLP), Association of Persons (AOP), Body of Individuals
(BOI), local authority and artificial juridical person

This relates to the financial year pertaining to the audit. This

period is typically from the 1st April to 31st March of the next
6 Previous year from ___ to ____
year but care has to be taken in case of closure of businesses,
new businesses, amalgamations, demergers, etc.

This relates to the relevant assessment year pertaining to the

7 Assessment Year
audit

Indicate the relevant clause of section 44AB under The applicable clause [(a) to (e)] of Section 44AB under which
8
which the audit has been conducted tax audit is being conducted should be selected.

The name of the partners or members of a firm or AOP will be

covered here. In case a person is in a representative capacity
If firm or association of persons, indicate name of (e.g., A’s HUF is a partner and A is in representative capacity on
9 (a)
partners/members and their profit sharing ratios behalf of the HUF), then the name of the beneficial
partner/member should be mentioned (A’s HUF). Further, profit
sharing ratio includes the ratio at which losses would be shared.

If there is any change in the partners or members or in

All changes that occur during the year, no matter how often,
(b) their profit sharing ratio since the last date of the
must be mentioned.
preceding year, the particulars of such change

Nature of business or profession (if more than one

The assesse will have to select the business code applicable to
10 (a) business or profession is carried on during the previous
him from the list provided. If there are any changes in the nature
year, nature of every business or profession)
of business or profession to be carried out, the same needs to
be mentioned. Temporary discontinuance of business need not
If there is any change in the nature of business or
(b) be mentioned.
profession, the particulars of such change

Whether books of account are prescribed under section Every person, upon crossing a specified limit of turnover, needs
11 (a)
44AA, if yes, list of books so prescribed. to compulsorily maintain certain books of accounts as
prescribed like cash book, journal, ledger, etc. Further, certain
Lists of books of account maintained and the address at specified professionals have additional records prescribed that
(b)
which the books of account are kept. they must maintain. For example, a doctor must maintain a daily
case register where certain details of patient visits are
List of books of account and nature of relevant recorded. The tax auditor lists the books and records that were
(c)
documents examined checked by him.

Whether the profit or loss account includes any profits The amount of profit that relates to a business subject to the
and gains assessable on presumptive basis, if yes, presumptive scheme of taxation must be reported here. In case
12 indicate the amount and the relevant section (44AD, of multiple businesses, only the amount of profit that relates to
44AE, 44AF, 44B, 44BB, 44BBA, 44BBB, Chapter XII-G, First the businesses subject to the presumptive scheme of taxation
Schedule or any other relevant section) will be reported section-wise.

13 (a) Method of accounting employed in the previous year

Whether there had been any change in the method of The method of accounting, whether cash or mercantile must be
(b) accounting employed vis-à-vis the method employed mentioned. Companies however are compulsorily required to
in the immediately preceding previous year. maintain their accounts on accrual or mercantile basis under
the Companies Act
If answer to (b) above is in affirmative, give details of
(c)
such change, and the effect thereof on the profit or loss.

Whether any adjustment is required to be made to the

The Income Tax Act has prescribed certain Income Computation
profits or loss for complying with the provisions of
(d) and Disclosure Standards (ICDS) ranging from ICDS I to ICDS X.
income computation and disclosure standards notified
The effect of these ICDS must be taken in the computation of
under section 145(2)
tax to arrive at the net tax liability – The increase in profit,
decrease in profit and net effect is mentioned as per each
If answer to (d) above is in the affirmative, give details
(e) ICDS.
of such adjustments

The ICDS also contain certain disclosure requirements and this is

(f) Disclosure as per ICDS
the clause under which such disclosures are ultimately made.

Method of valuation of closing stock employed in the

14 (a)
previous year. This method of valuation would be on the basis of the method
of accounting regularly employed by the assessee subject to
In case of deviation from the method of valuation certain prescribed adjustment on account of tax, duty, cess, etc.
(b) prescribed under section 145A, and the effect thereof (like excise duty, VAT) incurred in procuring the inventory.
on the profit and loss

Give the following particulars of the capital asset

15
converted into stock-in-trade:
Generally speaking, an asset held as a capital asset would
attract income under the head capital gains at the time of its
(a) Description of capital asset;
sale and an asset held as stock-in-trade would attract income
(b) Date of acquisition; under the head profits and gains of business. When it is decided
to treat a capital asset as part of the stock of the business, it is
(c) Cost of acquisition;
treated as a ‘transfer’ for income tax purposes and will attract
capital gains subject to certain conditions and exceptions.
Amount at which the asset is converted into stock-in-
(d)
trade.

Amounts not credited to the profit and loss account, Section 28 is the charging section for the income under the
16
being – head ‘profits and gains of business or profession’. This clause
intends to capture and report those incomes which ordinarily
(a) The items falling within the scope of section 28;
wouldn’t be a business income but is deemed to be business

The proforma credits, drawbacks, refund of duty of income by virtue of the Income Tax Act. For example,

customs or excise or service tax, or refund of sales tax compensation received on account of termination of

(b) or value added tax where such credits, drawbacks or employment, profit on sale of import license, remuneration

refunds are admitted as due by the authorities received by a partner from a partnership firm, etc. Even export

concerned; benefits like pro forma credits, duty drawbacks, refund of

customs, etc. would be covered under this clause if not credited
(c) Escalation claims accepted during the previous year; to the profit and loss account. Further, a capital receipt would
not normally attract tax unless the transaction is specifically
(d) Any other item of income;
covered in the provisions. Thus if such receipt is not appearing
(e) Capital receipt, if any. in the profit and loss account it will be covered here.

If the sale consideration of an immovable property is less than

Where any land or building or both is transferred during
the stamp duty value of such property, the stamp duty value
the previous year for a consideration less than value
shall be deemed to be the sale consideration for the purpose of
adopted or assessed or assessable by any authority of
computing capital gains thereon where such property is held as
17 the State Government referred to in section 43CA or
a capital asset and where the property is held as stock-in-
50C, please furnish details of property, consideration
trade, the stamp duty value shall be taken as income/sale value
received or accrued and value adopted or assessed or
to be considered under the business head of income. This
assessable
clause aims to check compliance in this regard.

Particulars of depreciation allowable as per the Income

18 Tax Act, 1961 in respect of each asset or block of asset,
as the case may be, in the following form:-

(a) Depreciation of asset/block of assets

(b) Rate of depreciation

(c) Actual cost of written down value, as the case may be

The Income Tax Act prescribes depreciation to be charged as
Additions/deductions during the year with dates; in the
per the ‘block of assets system’ subject to certain conditions.
case of any addition of an asset, date put to use;
This clause checks that the depreciation has been arrived at
including adjustment on account of: (i) Central Value
correctly.
Added Tax credits claimed and allowed under the
(d)
Central Excise Rules, 1944, in respect of assets acquired
on or after 1st March 1994, (ii) change in rate of currency,
and (iii) subsidy or grant or reimbursement, by whatever
name called.

(e) Depreciation allowable

(f) Written down value at the end of the year

These sections allow for special deductions for prescribed

Amounts admissible under sections: 32AC, 32AD, 33AB,
businesses. The tax auditor checks whether the assessee has
33ABA, 35(1)(i), 35(1)(ii), 35(1)(iia), 35(1)(iii), 35(1)(iv), 35(2AA),
19 complied with all the necessary conditions to claim a deduction
35(2AB), 35ABB, 35AC, 35AD, 35CCA, 35CCB, 35CCC,
under these sections. Some of these sections may require a
35CCD, 35D, 35DD, 35DDA, 35E;
certificate by a Chartered Accountant certifying the eligibility.

The assessee would be allowed a deduction in respect of a

Any sum paid to an employee as bonus or commission payment made to an employee in the nature of a bonus of
20 (a) for services rendered, where such sum was otherwise commission only if such bonus or commission was available
payable to him as profits or dividend exclusively to such employee in relation to the services
rendered by him.

These funds include superannuation funds created for the

benefit of the employee. The contributions made by the
Details of contribution received from employees for
(b) employer to such funds shall be allowed as a deduction only if
various funds as referred to in section 36(1)(va)
they are made within the due date as specified in the
applicable law.

The nature of these expenses are such that they may either be
Please furnish the details of amounts debited to profit
fully disallowed or only allowed subject to certain conditions. If
21 (a) and loss account, being in the nature of capital,
they form a part of the profit and loss account, they have to be
personal, advertisement, expenditure, etc.
disclosed here.

These sections broadly relate to disallowances made in respect

Amounts inadmissible under section 40(a)(i), 40(a)(ia), of an expenditure or a part of an expenditure where tax was
(b)
40(a)(ic), 40(a)(iia), 40(a)(iib), 40(a)(iii), 40(a)(iv), 40(a)(v) required to be deducted at source but the assessee failed to do
so.

This is applicable to firm, AOP or BOI assessees where payments

Amounts debited to profit and loss account being, are made to the partners/members in the nature of salary,
interest, salary, bonus, commission or remuneration remuneration, interest, etc. The Act has prescribed certain limits
(c)
inadmissible under section 40(b)/40(ba) and upto which such expenditure can be allowed in the hands of
computation thereof; the firm/AOP/BOI and if the expenditure exceeds this limit, the
same is not allowed as a deduction.

This section places a disallowance on any expenditure incurred

by any mode other than an account payee cheque/bank draft
(d) Disallowance/deemed income under section 40A(3)
or through a bank account using ECS if they exceed Rs. 10,000
in a day subject to certain exceptions.

The deduction under this section is allowed in relation to a

Provision for payment of gratuity not allowable under provision created for payment of contribution to an approved
(e)
section 40A(7); gratuity fund only if such sum is actually payable during the
year.

Any payment incurred by an employer towards setting up of any

Any sum paid by the assessee as an employer not
(f) fund, trust, Company, AOP, BOI, Society, etc will not be allowed
allowable under section 40A(9);
as a deduction subject to certain exceptions.

Such a liability usually relates to ongoing legal disputes where it

(g) Particulars of any liability of a contingent nature;
is not certain that there will be a liability for the as assessee.

Amount of deduction inadmissible in terms of section The section prescribes a method of calculation of an amount of
(h) 14A in respect of the expenditure incurred in relation to expenditure which will be disallowed as it is deemed to be
income which does not form part of total income; incurred towards earning exempt income.

Where the assessee borrows a loan for business purposes, the

interest thereon would normally be allowed as a deduction.
Amount inadmissible under the proviso to section 36(1) However, if such loan was used to acquire an asset, the interest
(i)
(iii) shall not be allowed for the period between the date of
borrowing of the loan to the date on which the asset was put to
use.

Amount of interest inadmissible under section 23 of the The MSME act prescribes an amount of interest that would not
22 Micro, Small and Medium Enterprises Development Act, be allowed as a deduction in the computation of taxable
2006. income of the assessee.

This section basically disallows expenditure incurred by way of

Particulars of payments made to persons specified
23 payment to specified persons (relatives) if the assessing officer
under section 40A(2)(b)
finds them to be excessive in nature.

These sections allow for a special deduction to certain

Amounts deemed to be profits and gains under section assessees subject to certain conditions. In case of a breach of
24
32AC or 32AD or 33AB or 33ABA or 33AC. these conditions, the whole or a part of the deduction allowed
earlier would be included as deemed income.

This section relates to deemed profits arising out of:

Where a deduction has been allowed in an earlier year in

respect of an expenditure but the assessee has received some
benefit whether by cash or by reduction in actual liability in the
current year, such benefit will be chargeable to tax under this
section.

Where an asset has been sold by an assessee engaged in the

power generation and distribution and such sale consideration
exceeds the written down value.
Any amount of profit chargeable to tax under section 41
25 Where an asset used in scientific research has been sold for a
and computation thereof.
consideration greater than its original cost

Where a bad debt that was allowed earlier is subsequently

recovered.

Where an amount has been withdrawn from a special reserve

created by a financial company on which deduction was earlier
allowed

Where such amounts/benefits as above have been received

even after the closure of business.

In respect of any sum referred to in clauses (a), (b), (c),

26
(d), (e), (f) or (g) of section 43B, the liability for which:-
This section allows certain expenditure like cesses, taxes, duties,
interest to bank, etc. to be claimed only on actual payment of
Pre-existed on the first day of the previous year but
the same if it is made before the due date of filing the return for
was not allowed in the assessment of any preceding
(a) the respective assessment year.
previous year and was (a) paid during the previous year;
(b) not paid during the previous year;

Was incurred during the previous year and was (a) paid
on or before the due date for furnishing the return of
income of the previous year under section 139(1); (b) not
(b) paid on or before the aforesaid date (State whether
sales tax, customs duty, excise duty, or any other
indirect tax, levy, cess, impost, etc., is passed through
the profit and loss account.)

Amount of Central Value Added Tax credits availed of or The details of the CENVAT credit carried forward from the
utilised during the previous year and its treatment in the previous year, its utilization and the balance left needs to be
27 (a)
profit and loss account and treatment of outstanding provided along with the treatment of the same in the accounts
Central Value Added Tax credits in the accounts. of the as assessee.

Particulars of income or expenditure of prior period This clause would be relevant only for the persons following the
(b)
credited or debited to the profit and loss account. mercantile system of accounting.

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
28
interested, without consideration or for inadequate
Where the assessee receives certain shares of a private limited
consideration as referred to in section 56(2)(viia), if yes,
company where the Fair Market Value of such shares minus the
please furnish details of the same.
amount paid to acquire such shares exceeds Rs. 50,000, such
excess shall be chargeable to tax under the head ‘Income from
Whether during the previous year the assessee
other sources’.
received any consideration for issue of shares which
29 exceeds the fair market value of the shares as referred
to in section 56(2)(viib), if yes, please furnish details of
the same.

Whether any amount is to be including in income

chargeable under the head ‘income from other sources’
29A (a)
as referred to in clause (ix) of sub-section (2) of section Advances received in relation to the transfer of a capital asset

56? (Yes/No) are shown as income from other sources where the advances
are forfeited and the capital asset is not ultimately transferred.
If yes, please furnish the following details: (i) Nature of
(b)
income (ii) Amount thereof

Details of any amount borrowed on hundi or any

amount due thereon (including interest on the amount
30 Hundis are financial instruments not recognised by formal law.
borrowed) repaid, otherwise than through an account
payee cheque [Section 69D]

Whether primary adjustment to transfer price, as

30A (a) referred to in sub-section (1) of 92CE, has been made
during the previous year? (Yes/No)

If yes, please furnish the following details:- (i) Under

which clause of sub-section (1) of 92CE primary
The transfer pricing provisions under the Income Tax Act in
adjustment is made? (ii) Amount (in Rs.) of primary
general aim to value transactions with associated enterprises at
adjustment (iii) Whether the excess money available
an arm’s length price. This clause aims to capture such relevant
with the associated enterprise is to be repatriated to
information within the tax audit report.
(b) India as per the provisions of sub-section (2) of section
92CE? (Yes/No) (iv) If yes, whether the excess money
has been repatriated within the prescribed time
(Yes/No) (v) If no, the amount (in Rs.) of imputed interest
income on such excess money which has not been
repatriated within the prescribed time.

Whether the assessee has incurred expenditure during

the previous year by way of interest or of similar nature
30B (a)
exceeding one crore rupees as referred to in sub-
section (1) of section 94B? (Yes/No)
Where an Indian Company borrows a sum of money from an
If yes, please furnish the following details:- (i) Amount (in associated enterprise, the deduction in respect of interest
Rs.) of expenditure by way of interest or of similar payable on such borrowed amount under the Income-tax Act
nature incurred: (ii) Earnings before interest, tax, shall be restricted to 30% of EBITDA (Earnings before interest,
depreciation and amortization (EBITDA) during the tax, depreciation and amortisation). The interest in excess of
previous year (in Rs.): (iii) Amount (in Rs.) of expenditure 30% shall be allowed to be set off in subsequent years subject
(b) by way of interest or of similar nature as per (i) above to certain conditions. This clause places a check for compliance
which exceeds 30% of EBITDA as per (ii) above: (iv) in this regard.
Details of interest expenditure brought forward as per
sub-section (4) of section 94B (v) Details of interest
expenditure carried forward as per sub-section (4) of
section 94B

Whether the assessee has entered into an impermissible

30C (a) avoidance arrangement, as referred to in section 96, An impermissible avoidance arrangement would be an

during the previous year? (Yes/No) arrangement where the main purpose is to obtain a tax benefit
and is not at arm’s length, results in tax evasion (directly or
If yes, please specify:- (i) Nature of the impermissible indirectly), lacks commercial substance or is carried out in a
avoidance arrangement: (ii) Amount (in Rs.) of tax manner that does not otherwise occur if the arrangement was
(b)
benefit in the previous year arising, in aggregate, to all for bona fide purposes.
the parties to the arrangement”;

Particulars of each loan or deposit in an amount

exceeding the limit specified in section 269SS taken or
accepted during the previous year: Name, address and
PAN of the lender or depositor, Amount of loan or
deposit taken or accepted, whether the same was
31 (a)
squared up during the year, maximum amount
outstanding at any time during the previous year,
Taking a loan or any amount in relation to an immovable
whether the same was taken or accepted by cheque or
property (specified sums) exceeding Rs. 20,000 otherwise than
bank draft (specify if account payee) or use of ECS
by way of an account payee cheque or bank draft or use of a
through a bank account
bank account through ECS would attract a penalty equal to the
amount borrowed. Details of all loans or specified sums taken
Particulars of each specified sum in an amount
exceeding Rs. 20,000 are provided herein.
exceeding the limits specified in section 269SS taken or
accepted during the previous year: Name, address and
PAN (if available) of the person from whom specified
(b)
sum is received, amount of specified sum taken or
accepted, whether the specified sum was taken or
accepted by cheque or bank draft (specify if account
payee) or use of ECS through a bank account

Particulars of each specified sum in an amount

exceeding the limits specified in section 269ST taken or
accepted during the previous year: Name, address and
PAN (if available) of the person from whom specified
(ba)
sum is received, amount of specified sum taken or
accepted, whether the specified sum was taken or
accepted by cheque or bank draft (specify if account
payee) or use of ECS through a bank account

Particulars of each receipt in an amount exceeding the

limit specified in section 269ST, in aggregate from a
person in a day or in respect of a single transaction or
in respect of transactions relating to one event or
(bb) occasion from a person, received by a cheque or bank
draft, not being an account payee cheque or an
account payee bank draft, during the previous year:- (i)
Name, address and Permanent Account Number (if Section 269ST says that a person is not allowed to receive more

available) of the payer; (ii) Amount of receipt (in Rs.) than Rs. 2 lakh from either: (i) From a person in a day (in total); (ii)
In respect of single transaction; or (iii) In respect of transactions
Particulars of each payment made in an amount relating to a single event/occasion; If such amount is paid
exceeding the limit specified in section 269ST, in through any mode other than an account payee cheque / bank
aggregate to a person in a day or in respect of a single draft or use of ECS through a bank account. The reporting of
transaction or in respect of transactions relating to one non-compliance with this section will be made in this clause.
event or occasion to a person, otherwise than by a
(bc)
cheque or bank draft or use of electronic clearing
system through a bank account during the previous
year:- (i) Name, address and PAN (if available) of the
payee; (ii) Nature of transaction; (iii) Amount of payment
(in Rs.); (iv) Date of payment;

Particulars of each payment in an amount exceeding

the limit specified in section 269ST, in aggregate to a
person in a day or in respect of a single transaction or
in respect of transactions relating to one event or
(bd) occasion to a person, made by a cheque or bank draft,
not being an account payee cheque or an account
payee bank draft, during the previous year:- (i) Name,
address and PAN (if available) of the payee; (ii) Amount
of payment (in Rs.)

Particulars of each repayment of loan or deposit or any

specified advance in an amount exceeding the limit
specified in section 269T made during the previous year:
Name, address, PAN (if available) of payee, amount of
(c)
repayment, maximum amount outstanding at any time
during the previous year, whether the repayment was
made by cheque or bank draft (specify if account
payee) or use of ECS through a bank account

Particulars of repayment of loan or deposit or any

specified advance in an amount exceeding the limit
Repayment of a loan or any amount in relation to purchase of
specified in section 269T received otherwise than by a
an immovable property (specified sums) exceeding Rs. 20,000
cheque or bank draft or use of ECS through a bank
otherwise than by way of an account payee cheque or bank
(d) account during the previous year: Name, address, PAN (if
draft or use of a bank account through ECS would attract a
available) of the payer, amount of loan or deposit or
penalty equal to the amount borrowed. Details of all
any specified advance received otherwise than by a
repayments of loans or specified sums paid exceeding Rs.
cheque or bank draft or use of ECS through a bank
20,000 during the year are provided herein.
account during the previous year.

Particulars of repayment of loan or deposit or any

specified advance in amount exceeding the limit
specified in section 269T received by a cheque or bank
draft which is not an account payee cheque or account
(e) payee bank draft during the previous year: Name,
address, PAN (if available), of the payer, amount of loan
or deposit or any specified advance received by a
cheque or a bank draft which is not an account payee
bank cheque or bank draft during the previous year.

Details of brought forward loss or depreciation Such amounts need to be revised for any change arising out of
32 (a)
allowance to the extent available a rectification order, assessment order, etc.

This provision is applicable to a private limited company with

the following exceptions:

Less than 51% of the voting power only has changed hands

Whether a change in the shareholding of the company

Change in shareholding is due to death of a shareholder
has taken place during the previous year due to which
(b)
the losses incurred prior to the previous year cannot be
Change in shareholding is due to shares gifted by a shareholder
allowed to be carried forward in terms of section 79.
to a relative

Where the holding Company is a foreign company and the

change in shareholding is due to amalgamation/demerger
where less than 51% of the shareholding has changed

Whether the assessee has incurred any speculation loss

(c) referred to in section 73 during the previous year. If yes,
please furnish details of the same.

Whether the assessee has incurred any loss referred to

in section 73A in respect of any specified business A speculation loss cannot be set off against any income other
(d)
during the previous year, if yes, please furnish details of than a speculation gain. Further, a loss in speculation business
the same. will be allowed to be carried forward for only 4 years. This
clause keeps the above provisions in check.
In case of a company, please state that whether the
company is deemed to be carrying on a speculation
(e) business as referred in explanation to section 73, if yes,
provide details of speculation loss if any incurred during
the previous year.

The tax auditor will have to verify whether the assessee has
Section-wise details of deductions, if any, admissible
33 fulfilled the conditions necessary to claim the section-wise
under Chapter VIA or Chapter III (Section 10A, 10AA).
deductions.

Whether the assessee is required to deduct or collect

34 (a) tax as per the provisions of Chapter XVII-B or Chapter
These sections broadly relate to compliances in respect of TDS
XVII-BB, if yes, please furnish details
payable on certain expenses. The tax auditor reports the
Whether the assessee is required to furnish the expenditure on which tax was required to be deducted,
(b) statement of tax deducted or tax collected. If yes, whether such tax was actually deducted and paid to the
please furnish the details government on time. In case of a failure to comply on time, the
details of penalty in respect of such late payments will also be
Whether the assessee is liable to pay interest under
covered.
(c) section 201(1A) or section 206C(7). If yes, please furnish
details.

In the case of a trading concern, give quantitative

details of principal items of goods traded: (i) Opening
35 (a) Stock; (ii) purchases during the previous year; (iii) sales
during the previous year; (iv) closing stock; (v)
shortage/excess, if any

In the case of a manufacturing concern, give

quantitative details of the principal items of raw
materials, finished products and by-products: A. Raw The name of the stock item and its unit of measurement would
Materials: (i) opening stock; (ii) purchases during the need to be provided
previous year; (iii) consumption during the previous year;
(iv) sales during the previous year; (v) closing stock; (vi)
(b)
yield of finished products; (vii) percentage of yield; (viii)
shortage/excess, if any. B. Finished products/by-
products: (i) opening stock (ii) purchases during the
previous year; (iii) quantity manufactured during the
previous year; (iv) sales during the previous year; (v)
closing stock; (vi) shortage/excess, if any.

In the case of a domestic company, details of tax on

distributed profits under section 115-O in the following
Where a domestic company has paid dividend to its
form:- (a) total amount of distributed profits; (b) amount
shareholders, it is liable to pay dividend distribution tax thereon.
36 of reduction as referred to in section 115-O (1A)(i); (c)
This dividend also includes deemed dividend subject to certain
amount of reduction as referred to in section 115-O (1A)
conditions.
(ii); (d) total tax paid thereon; (e) dates of payments with
amounts.

a) Whether the assessee has received any amount in

the nature of dividend as referred to in sub-clause (e) of
36A clause (22) of section 2? (Yes/No) (b) If yes, please
furnish the following details:- (i) Amount received (in Rs.):
(ii) Date of receipt

Whether any cost audit was carried out, if yes, give the
details, if any, of disqualification or disagreement on any
37
matter/item/value/quantity as may be
The provisions of deemed dividend are attracted when a
reported/identified by the cost auditor.
private limited company advances an amount to a shareholder
(or to a concern in which he has a substantial interest) having
Whether any audit was conducted under the Central
more than 10% voting power in the company subject to certain
Excise Act, 1944, if yes, give the details, if any, of
conditions.
38 disqualification or disagreement on any
matter/item/value/quantity as may be
reported/identified by the auditor.

Whether any audit was conducted under section 72A of

the Finance Act, 1994 in relation to valuation of taxable
39 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.

Details regarding turnover, gross profit, etc. for the

previous year and preceding previous year: 1. Total
Calculation of such ratios would not be applicable for persons
40 turnover 2. Gross profit/turnover 3. Net profit/turnover 4.
engaged in profession/ service industry.
Stock-in-trade/turnover 5. Material consumed/finished
goods produced

There are various other legislations like indirect tax, profession

Please furnish details of demand raised or refund issued
tax, etc. that the assessee may be subject to and such acts may
during the previous year under any tax laws other than
41 have their own authorities to pass a demand or refund order.
Income-tax Act, 1961 and Wealth Tax Act, 1957
The details of orders of such authorities need to be provided in
alongwith details of relevant proceedings
this clause.

Whether the assessee is required to furnish statement in

42 (a)
Form No. 61 or Form No. 61A or Form No. 61B? (Yes/No)

The forms mentioned in this clause relate to Specified Financial

If yes, please furnish Income-tax Department Reporting
Transactions where reporting needs to be done in respect of
Entity Identification Number, Type of form, Due date for
certain prescribed transactions when they are entered into by
furnishing, Date of furnishing (if furnished), Whether the
(b) such assessees as are prescribed in Section 285BA.
form contains information about all details/ transactions
which are required to be reported. If not, please furnish
list of the details/ transactions which are not reported

Whether the assessee or its parent entity or alternate

43 (a) reporting entity is liable to furnish the report as referred
to in sub-section (2) of section 286 (Yes/No)
The report mentioned in this clause relates to providing
information in respect of the international group of entities of
If yes, please furnish the following details: (i) Whether
which the assessee is a part and where the parent entity of
report has been furnished by the assessee or its parent
such international group is not resident in India.
(b) entity or an alternate reporting entity (ii) Name of
parent entity (iii) Name of alternate reporting entity (if
applicable) (iv) Date of furnishing of report

This clause attempts to provide a break-up of the total

expenditure into various fields that are relevant from the GST
point of view like expenditure in relation to exempt goods /
Break-up of total expenditure of entities registered or
44 services under GST, payments to entities under the Composition
not registered under the GST
Scheme, Payments to entities not registered under GST etc. A
similar schedule is available as a part of the Income Tax return
forms to be filled up by those not liable for tax audit.

Conclusion
The taxpayers are responsible to get their accounts audited. A Chartered Accountant is required to cross-examine the books of accounts
of the taxpayer and provide the findings in the tax audit report.
It is important to submit details with accuracy to avoid any proceedings.

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