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Implementation guide on revision in Form No 3CD and 3CEB issued by ICAI

Tax audit under section 44AB of the Income-tax Act, 1961 is a significant compliance requirement aimed at ensuring transparency and fairness in tax assessments. It plays an important role in promoting tax compliance and preventing tax evasion. The Central Board of Direct Tax (CBDT) has amended Form No. 3CD and Form 3CEB vide notifications issued in March 2024. Amendments have been made in various clauses of Form No.3CD and Form 3CEB.

The Direct Tax Committee of ICAI has issued an implementation guide on revision in Form No 3CD and 3CEB. The amendments in the implementation guide are as follows.

1. Amendments in Form 3CD

• In clause 8A relating to whether an assessee has opted for special provisions u/s 115BA/115BAA/115BAB/115BAC/115BAD, to include reporting requirement in relation to section 115BAE
• In Clause 12 relating to Whether the profit and loss account includes any profits and gains assessable on a presumptive basis, o include specific reporting requirement in relation to section 44ADA
• Clause 18(ca) relating to the adjustment made to written down value under the different provisos to section 115BAA/115BAC/115BAD for the specified assessment years
• Clause 19 relating to claim admissible of certain sections of Income Tax Act, to include reporting requirement in relation to section 35ABA and "any other relevant section"
• Clause 21(a) relating amounts debited to the profit and loss account, being in the nature of capital, personal, advertisement expenditure etc. to include specific reference to expenditure incurred to compound an offence under any law for the time being in force, in India or outside India, expenditure incurred to provide any benefit or perquisite to a person and acceptance of such benefit or perquisite by such person is in violation of any law or rule or regulation or guideline governing the conduct of such person, etc.;
• In clause 22, include reporting requirement in respect of any other amount not allowable u/s 43B(h) relating to the amount payable to micro and small enterprises.
• In clause 32(a) relating to details of brought forward loss/depreciation, to include reference to losses/allowances not allowed under section 115BAE and amount adjusted by way of withdrawal of additional depreciation on account of opting for taxation under section 115BAE.

2. Amendments in Form No. 3CEB Part relating to Part C (Specified domestic transaction) in the Annexure to Form No. 3CEB which is the Report from an accountant to be furnished under section 92E relating to international transaction(s) and specified domestic transaction(s).

Click Here to Read the Implementation Guide

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