TAX AUDIT

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HEMANT JAIN (Querist)
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03 October 2016 I want to know about clause 34 a in TAX AUDIT REPORT WHAT KIND OF TRANSACTIONS COVER UNDER IS ALL ENTRIES ON WHICH TAX DEDUCTED WILL ENTER IN THIS CLAUSE ????

Anand

Anand (Expert)
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06 October 2016 In column (4), of clause 34(a) the auditor is required to furnish the details of the total amount of payment or receipt of the nature specified in column (3). The details in the said column may be drawn from the TDS/TCS statements furnished by the assessee to the Department along with the books of accounts and other relevant documents which include aggregate of payments on which tax is liable to be deducted as well as not liable to be deducted. Auditor may maintain working paper giving reconciliation of amount as per books of accounts and amount on which is TDS/TCS is required to be deducted/collected.
Column (5) casts an onerous responsibility on the auditor, wherein he is required to furnish the details of total amount on which the tax was required to be deducted or collected out of the amount mentioned in column (4) having regard to the nature of payments/ receipts under the relevant sections of Chapter XVII-B / XVII-BB. Since the reporting under column (4) is required to be made with regard to the nature of payments made or amount received, there may be a difference in the amounts reported under column (4) and column (5). The reasons for difference may be applicability of
certificates issued under section 195/197 or threshold limits provided. The auditor may have a difference of
opinion with regard to the applicability of the provisions of TDS/TCS on a particular payment. In such a case, the tax auditor has to bring the difference of opinion appropriately as an observation in the clause (3) of Form No. 3CA
or clause (5) of Form No.3CB as the case may be.
Please refer to ICAI Guidance note on Tax Audit issued in 2014 for further clarifications on this subject