Form 3CD is a basic Form of Tax audit and needs to be uploaded with all tax audit and audited financials with Income tax department.
Form 3CEB is a Form which needs to be filed in case of international taxation along with Form 3CD. Thus, Form 3CEB is related to transfer pricing and is required if there is assessee has entered into any international or specified domestic transaction.
Vide Amendment to Income Tax rules, 2020 CBDT has made few amendment to Form 3CD and Form 3CEB which is as under:
The updation are mainly related to incorporation of section 115BAA, 115BAB into the tax audit form.
1. in Part A, after serial number 8 and the entries relating thereto, the following shall be inserted, namely: –
“8a. Whether the assessee has opted for taxation under section 115BA/115BAA/115BAB?”
2. in Part B, – (I) in serial number 18, after clause (c), the following clauses shall be inserted, namely: –
“(ca) Adjustment made to the written down value under section 115BAA (for assessment year 2020-21 only)
(cb) Adjusted written down value”;
(II) in serial number 32, for clause (a), the following clause shall be substituted, namely: –
“(a) Details of brought forward loss or depreciation allowance, in the following manner, to the extent available:
|Sl No||Assessment Year||Nature of loss/ allowance (in rupees)||Amount as returned* (in rupees)||All losses/ allowances not allowed under section 115BAA||Amount as adjusted by withdrawal of additional depreciation on account of opting for taxation under section 115BAA^||Amounts as assessed (give reference to relevant order)||Remarks|
*If the assessed depreciation is less and no appeal pending than take assessed.
^ To be filled in for assessment year 2020-21 only.”;
Thus, 2 amendments have been made in Form 3CD, first asks about whether the new provision has been opted or not and second talks about adjustment in depreciation if new provision has been opted.
In form 3CEB the following amendments have been made which is also related to the new corporate tax rate and few other small amendments:
(i) serial number 22 and the entries relating thereto shall be omitted;
(ii) serial numbers 23 and 24 shall be re-numbered as serial numbers 22 and 23 respectively;
(iii) after serial number 23 as so renumbered, the following shall be inserted, namely: –
|“24.||Particulars in respect of specified domestic transaction in the nature of any business transacted between the persons referred to in sub-section (6) of section 115BAB: Has the assessee entered into any specified domestic transaction(s) with any persons referred to in sub-section (6) of section 115BAB which has resulted in more than ordinary profits expected to arise in such business? If “yes”, provide the following details: (a) Name of the person with whom the specified domestic transaction has been entered into (b) Description of the transaction including quantitative details, if any. (c) Total amount received/receivable or paid/ payable in the transaction – (i) as per books of account; (ii) as computed by the assessee having regard to the arm’s length price. (d) Method used for determining the arm’s length price [See section 92C(1)].||
Thus, these are the only amendments made in form 3CD and 3CEB and same were announced on 01.10.2020.
Hence, any audit report filed before this date without this amendment shall also be considered valid and there won’t be any issue.
However, all companies and other assessee who haven’t filed their tax audit reports till now are suggested to wait for the update to come in their utility and then file the tax audit report.
To read the full notification CLICK HERE.