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Every Income Tax Return Filled by Asseessee will be Processed by Income Tax Department at Centralised Processing Centre (CPC) Bangalore without calling Asseessee.

During Processing of Income Tax Return Income Tax Department will Compute Income of Asseessee after Making Certain Adjustments.

Following Adjustments will be made in Income of Asseessee During Processing of Income Tax Return: -

Any Arithmetic Error in Income Tax Return Filled.

Any Incorrect claim apparent from Records i.e. Claim made Asseessee in Income Tax Return is inconsistent with any other entry of same item or other time.

Any Claim made by Asseessee in Income Tax Return for which Information Required to be furnished, has not been furnished.

Any Deduction claimed by Asseessee in Income Tax Return Filled exceeds Monetary Limit Prescribed under Income Tax Act.

Any Loss of Previous Year is Set off by Asseessee in Income Tax Return of  Current Year when Income Tax Return of Previous Year is filed after Due Date prescribed under Sec 139(1) of Income Tax Act.

Any Expenditure indicated in Audit Report but not Taken in Income Computation of Current Year.

Any Deduction Claimed by Asseessee under sec 10AA, sec 80 - IA, Sec 80 - IAB, Sec 80 - IB, Sec 80 - IC, Sec 80 - ID, or Sec 80 - ID of Income Tax Act but Income Tax Return is filed after Due Date prescribed under sec 139(1) of Income Tax Act.

Addition of Income on Basis of Mismatch in Income Declared by Asseessee in Income Tax Return and Income as Per 26 AS, form 16 or Form 16 A.

 

Reasons for Mismatch in Income Declared by Asseessee in Income Tax Return Filled and Income as Per 26 AS, Form 16 and Form 16 A

TDS deducted by Payer under different sec of Income Tax Act and Asseessee is filling his or Her Income Return without Considering Income under Such sec in which TDS deducted by Payer.

TDS is Deducted under Sec 194 J of Income Tax Act but Asseessee is not filling his Income Tax Return under Sec 44ADA of Income Tax Act or Asseessee had not shown professional Receipts under Head Income from. profession in Profit and Loss wherever Asseessee is required to file Profit and Loss Account or Asseessee is voluntarily filing Books of Account.

TDS is Deducted under Sec 194 H of Income Tax Act on Commission paid to asseessee and Asseessee had not shown or report Commission under Head Income for Other Source or Asseessee had not shown Commission Income Separately under Proper Head for Commission Income.

 Income under Head Income from Salary is shown in Income Tax Return after taking Benefits of Exemption of allowance i.e. Net Income from Salary Chargeable to Income Tax, but as Per 26 AS Income from Salary is more than Income from Salary Chargeable to Income Tax because in 26 AS Income from Salary is shown before providing benefits of Exemption allowances.

Deduction Claimed by Asseessee is Exceeding to the Actual Available Deduction based on Investment made and Expenditure done by Asseessee.

Interest on Income Tax refund is not shown in Income Tax Return Filled. In so many cases  Asseessee fails to report Interest on Income Tax Refund Received, if interest on Income Tax Refund is not reported in Income Tax Return Filled than Asseessee will be served with Notice under sec 143 (1) of Income Tax Act for Mismatch in Income Declared by Asseessee in Income Tax Return Filled and Income as Per 26 AS but in certain cases Asseessee not receive Notice under sec 143 (1) of Income Tax Act for Mismatch in Income Declared by Asseessee in Income Tax Return Filled and Income as Per 26 AS due to other Income shown or reported by Asseessee under Head Income from Other Sources are of such amount which can exceed alone total Income Chargeable under Head Income from Other Sources including Interest on Income Tax Refund.

Exempted Income from Long Term Capital Gain not reported in Income Tax Return Filled. Although Long Term Capital Gain on Sale or Transfer of Securities held is not chargeable to Income Tax subject to Maximum amount of Rs. 100000 but reporting of such Long Term Capital Gain is mandatory.

Exempted Income from Dividend Received by Individual or Hindu Undivided Family (HUF) on Shares of Domestic Company. Income from Dividend Received by Individual or Hindu Undivided Family HUF on Shares of Domestic Company will be exempted from Income Tax subject to Maximum amount of Rs. 10 Lakh.

Interest on Saving Account is not reported in Income Tax Return Filled by Asseessee or Less Interest on Saving Account is reported in Income Tax Return Filled by Asseessee in Income Tax Return.

Interest on Fixed Deposit is not reported on Interest earned Basis but reported when Interest on Fixed Deposit is received on Redemption of Fixed Deposit.

TDS deducted under sec 198 B of Income Tax Act but Asseessee had not reported any Income which is Chargeable to Income Tax at Special Rate.

 

Asseessee should consider following Important Points before Filling Income Tax Return to avoid any Notice under Sec 143 (1) of Income Tax Act for Mismatch of Income: -

Asseessee should report all Income weather Chargeable to Income Tax or Not, i.e. Assessee should report all Income Exempted from Income Tax like Long Term Capital Gain on Transfer of Securities through Recognised Stock Exchange, Income from Dividend Received by Individual or Hindu Undivided Family (HUF) on Shares of Domestic Company, Interest Income etc.

Asseessee should cross verify that any Interest Received on Income Tax Refund. Interest on Income Tax Refund is shown seperately in 26 AS .

If any TDS is Deducted under Sec 194 J, 194 H, or any other sections of Income Tax Act which requires Income shall be reported separately under Applicable Head and at appropriate Place, in such case Asseessee shall report accordingly or request payer to rectify TDS Return and Deducting TDS otherwise which is suitable to receiver.

Asseessee should report casual Income seperately under Head Income from Other Sources as Income which are Chargeable to Income Tax at Special Rates.