With the last day of the decade and the start of new year, many taxpayers also must have received a letter from Income tax department. I would call it a ‘Love letter’ :). In the language of law, this love letter is called as 'Assessment order' i.e. an order from Income Tax department for their assessment being done. Those who have received it, do also knows the pain of it. The pain of going through assessment, the pain of submitting the evidence and records, the pain of giving explanation to the professional handling the matter (C.A) on various transactions, motive and objective. However, this might not be the end of it for some of us. It may happen that you may not be happy with the assessment being done by the Tax officer in-spite of timely responding to the queries, in-spite of submitting all evidences, confirmations etc… Whether agree or disagree with the assessment, here is what we need to do next and the remedies that an taxpayer has been given under law to challenge the assessment made by assessing officer.
Any apparent mistake
If after perusal of the assessment order it appears that there are certain mistakes in the order which requires correction, an application for rectification of mistake can be filed under section 154. Mistake could be a calculation mistake, conflict in the assessment order and the demand and like. This rectification application u/s 154 once filed will be verified and if the assessing officer is satisfied that there is a mistake and need to be rectified, he will rectify the mistake and pass the fresh order.
Want to challenge the assessment?
It may so happen that even after giving all the required explanation, evidences, statements and other records to the assessing officer; he might not had considered and ignored all such explanations, documents and did the assessment on his best judgment which might have resulted in huge tax liability and interest thereon. You, being aggrieved with this, may want to challenge the stand of assessing officer before higher authorities. Here law gives you a remedy to file an appeal against the order of assessing officer before Commissioner (Appeal). This appeal has to be filed within 30 days from the date of receipt of assessment order.
However, if there is a delay beyond 30 days in filing appeal then Commissioner (Appeal) may, on sufficient cause being shown, condone the delay and admit the appeal.
An alternative to this appeal is to file an application for revision before Commissioner (under section 264). This is also called as revision in favor of Assessee.
Deposit of demand of Tax and Interest
If the assessment order and the calculated demand seems fine, our duty is to deposit the entire demand of tax and interest. Income tax allows period of 30 days to deposit the demand, beyond which interest for the period of delay beyond 30 days is charged and payable. Once deposited, you need to submit a copy of challan with the assessing officer to get the same recorded and vacate the demand.
Hence, if everything is correct and in order then the demand should be deposited within the prescribed time limit to avoid any further financial charges in the form of interest.
Therefore, you may, based on whether you agree or disagree with the assessment order, decide the suitable course of action and proceed.
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