Introduction: CBDT Notifies I-T (22nd Amendment) Rules 2023
The Central Board of Direct Taxes (CBDT) recently introduced significant amendments through its Notification No-82/2023 dated September 27, 2023, titled the Income Tax (Twenty Second Amendment) Rules 2023. These amendments brought by this notification of CBDT specifically focus on Rule-14A and Rule-14B, which address the crucial aspects of “Use of Forms” and “Guidelines on determining expenses” essential for reporting audits and inventory valuation under section 142(2A) of the Income Tax Act 1961.
These alterations are designed to streamline and enhance the reporting processes, ensuring greater accuracy and transparency in compliance with the tax regulations. It’s worth noting that these amendments brought by this notification of CBDT are poised to become effective from the date of their publication in the official gazette, marking a significant milestone in the evolving landscape of tax governance. In our subsequent discussions, we will delve into the nuanced details of these pivotal amendments by this CBDT notification, shedding light on their implications and intricacies for a comprehensive understanding of their implications in the realm of income taxation.
Amendments Under Rule 14A: Forms for Report of Audit or Inventory Valuation Under Section 142(2A)
(1) The report of audit of the accounts of an assessee which is required to be furnished under clause (i) of sub-section (2A) of section 142 shall be in Form No. 6B.
(2) The report of inventory valuation of an assessee which is required to be furnished under clause (ii) of sub-section (2A) of section 142 shall be in Form No. 6D.
Amendments Under Rule 14B (Guidelines on Determining Expenses for Audit or Inventory Valuation)
(1) Every Chief Commissioner shall for the purposes of clause (i) and (ii) of sub-section (2A) of section 142 shall maintain a panel of –– (a) accountants, out of the persons referred to in the Explanation to sub-section (2) of section 288; and (b) cost accountants, out of the persons referred to in the Explanation to section 142.
(2) Where the Assessing Officer directs –– (a) for audit under clause (i) of sub-section (2A) of section 142 on or after the 1st day of June, 2007; or (b) for inventory valuation under clause (ii) of sub-section (2A) of section 142 on or after the 1st day of April, 2023, the expenses of, and incidental to, audit or inventory valuation (including the remuneration of the Accountant or Cost Accountant, qualified Assistants, semi-qualified and other Assistants who may be engaged by such Accountant or Cost Accountant) shall not be less than Rs.3750/- and not more than Rs.7500/- for every hour of the period as specified by the Assessing Officer under subsection (2C) of section 142.
(3) The period referred to in sub-rule (2) shall be specified in terms of the number of hours required for completing the report.
(4) The Accountant or Cost Accountant referred to in clause (i) or clause (ii) of sub-section (2A) of section 142 shall maintain a time-sheet and shall submit it to the Chief Commissioner or Commissioner, along with the bill.
(5) The Chief Commissioner or the Commissioner shall ensure that the number of hours claimed for billing purposes is commensurate with the size and quality of the report submitted by the Accountant or Cost Accountant.
Amendments Under the Principal Rules (in Appendix ii)
(1) Heading of the Form-6B will be changed as “Audit report under clause (i) of section 142(2A) of the Income-tax Act, 1961”.
(2) In the Notes under Form-6B, for serial number 2 and entries relating thereto, the following serial number and entries shall be substituted, namely – “2. This report has to be given by the accountant nominated by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner of Income-tax under clause (i) of section 142(2A) of the Income-tax Act, 1961.
(3) Form-6D shall be inserted after Form-6C.
The principal rules were published in the Gazette of India, Extraordinary, Part-II, Section 3, Sub-section (ii) vide notification number S.O. 969 (E), dated the 26th March, 1962 and was last amended vide notification number G.S.R. 685(E) dated 25th September, 2023.
Click Here to access the Notification No-82/2023 of CBDT along with Form-6D
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