Income tax return in the first year of a company

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Sreekumar Narayanan (Querist)
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17 September 2010
Dear Friends,

A company was incorporated on 28th January, 2010. Turnover till 31st March, 2010 was Rs. 3,45,000.00. In the case of that company please clarify me the following,

1) Whether the company is liable to file Income Tax return for AY 2010-11.

2) If yes, whether it is required to conduct Statutory Audit under companies Act before filing IT Return or It can use unaudited financial statements for filing IT return.

3) If audit reports are not attached whether its IT Return will be considered as a defective return.

With Regards

Sreekumar.N

CA Suraj Lakhotia

CA Suraj Lakhotia (Expert)
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18 September 2010 1. The company has to file income tax return for AY 2010-11
2. The company can use unaudited financial statements for filing IT return
3. The return is to be submitted electronically after affixing digital signature. There is no question of anything to be attached with the return.

Praveen Sharma

Praveen Sharma (Expert)
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18 September 2010 Hi Sreekumar,

1. yes the Co. is liable to ITR as per IT Act.
2. Statutory audit need to be done before filing of ITR.
3. The Co. have to file ITR electronically with digital signature. hence, the question of attaching the audit report not arise.

Regards
P

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Sreekumar Narayanan

Sreekumar Narayanan (Querist)
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18 September 2010 Dear friends,

Thank you for your valuable reply.

In the above case will you please clarify me the following,

The company is incorporated only in january 2010 and as per companies act it has sufficient time to conduct its annual general meeting and to place before its first audit report.

In that case whether the accounts should be audited before filing IT Return or the company can use unaudited financial statements.

with regards

Sreekumar.N

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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31 July 2024 In India, a company is required to file its Income Tax Return (ITR) regardless of whether it has completed its first AGM or not. However, the company must ensure that it follows proper procedures as per both the Companies Act and the Income Tax Act.

Here's how it works:

1. **Audit Requirement**: According to the Income Tax Act, the financial statements for the company must be audited by a Chartered Accountant before filing the Income Tax Return. This audit should be done even if the company is in its first year of operation. The audited financial statements must be filed along with the ITR.

2. **Filing Deadline**: The deadline for filing the Income Tax Return is generally 30th September of the assessment year (for companies). For the first financial year, this would be the date for filing the return for the period from the date of incorporation to the end of the financial year (March 31st).

3. **Annual General Meeting (AGM)**: While the Companies Act provides time for the company to conduct its first AGM and present the audited financial statements to shareholders, the Income Tax Act requires that the financial statements be audited before filing the return. The AGM and the filing of the return are two separate processes.

4. **Unaudited Financial Statements**: Unaudited financial statements cannot be used for filing the Income Tax Return. The Income Tax Act mandates that the financial statements used for the tax return must be audited by a CA.

In summary, even if the company is still within the timeline for conducting its first AGM, it should ensure that its financial statements are audited before filing the Income Tax Return.