Special audit u/s 142(2A). - Income Tax - 1633/CBDT

INSTRUCTION NO. 1633/CBDT Dated: June 26, 1985 References is invited to Boards Instruction No.1415 (F.No.228/27/81-ITA-II), dated 23-9-81 by which the Board impressed upon the officers to refer more and more cases for special audit u/s.142(2A) of the I.T. Act, 1961 which required intensive investigation. Difficulties were however experienced in applying section 142(2A) of the Act in the cases of film artists for the reason that either the regular accounts were not maintained or the accounts maintained were so simple that even if invoked it may not yield desired results. 2. Section 44 AA which came into effect from 1-4-76 provide for the compulsory maintenance, by certain categories of taxpayers which include film artists of accounts and other documents and the Board has been empowered to prescribe by rules the books of accounts and other documents to be kept and maintained and the form and manner in which and the place at which they shall be so kept and maintained. 3. The Board by rule 6 F of the Income-tax rules, 1962 have prescribed for the purposes of section 44 AA the books of accounts and other documents to be kept and maintained and other ancillary provisions as to form and the manner in which and the place at which they shall be kept and maintained. The provisions of rule 6 F however have come into operation from the previous year commencing from 1-3-83. 4. Further section 44 AB has also been introduced in the I.T.Act with effect from 1-4-84 making it obligatory for a person carrying on profession to get his accounts audited before the specified date if the gross receipts in profession for the previous year or years relevant to the assessment year exceeds Rs.10 lakhs. 5. The provisions of sec.44 AA and rule 6 F made in this behalf therefore enable the Department to overcome the difficulties experienced earlier in certain class of cases requiring intensive investigation including the cases of film artists. 6. It may be emphasised here that section 44 AA, Section 44AB and of section 142(2A) are independent of each other. The board would therefore like to impress upon the officers that investigation of audit under section 142(2A) particularly in the cases of film artists and such other persons who are obliged to keep and maintain accounts and other documents in the manner provided in sec.44AA of the Act or otherwise should be resorted to in cases where it is considered expedient so to do.