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Clarification required

niki_1079 (CA Practice ) (279 Points)

20 February 2010

Hi All

Can anybody explain me Explanation 2 to Sec 153 and Explanation 3 to Sec 153 in Income Tax. Thanx in advance.

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2 Replies

Amir (Learner) (4016 Points)
Replied 20 February 2010

Dear Niki,

Explanation 2 to Sec 153 - Example

Suppose an order passed in 2010 by CIT(A) / ITAT / HC / SC / CIT u/s 263/264 says that any income is not taxable in the AY(say 2007-2008) in question becos such income pertains to another AY (say 2006-07), NOW TO GIVE EFFECT TO THIS FINDING OF THE ORDER, AO CAN COMPLETE THE ASSESSMENT EVEN AFTER THE TIME LIMIT FOR COMPLETION OF ASSESSMENT OF AY 2006-07 HAS EXPIRED...............

Explanation 3 to Sec 153 - Similary if order says that a particullar income is not taxable in the hands of assessee(Say Mr. A) becos it is the income of another assessee (Mrs. A), NOW AGAIN TO GIVE EFFECT TO THIS FINDING OF THE ORDER, AO CAN COMPLETE THE ASSESSMENT EVEN AFTER THE TIME LIMIT FOR COMPLETION OF ASSESSMENT IN CASE OF Mrs. X HAS EXPIRED...............

I hoe the above clarifies ur doubt......................