2.1       Query

Reporting on tax deducted at source as required in clause 11 of

 Form 3CD of Rule 6G of Income Tax Rules.

1.Clause 11 of Form 3CD of Tax Audit Report, as prescribed under Rule 6G of Income Tax Rules, requires the auditor to state whether the assessee has deducted tax at source and paid the amount so deducted to the credit of Central Government in accordance with the provisions of Chapter XVII-D. If not, the auditor is required to give details thereof.

2.The querist has drawn the attention of Expert Advisory Committee to para 45.1 of the “Guidance Note on Tax Audit under section 44 AB of the Income-tax Act, (1988)” which seems to suggest, in the view of the querist, that the duty cast upon the auditor is only to verify whether tax deducted at source has been paid in time to the Government. However, the reading of the clause seems to suggest, to the querist, that the auditor is expected to check as to whether tax has been deducted at source in accordance with the provisions of the Act. The querist has therefore sought the opinion of the Committee that in a case, where the assessee has not deducted tax at source, say from interest, is it necessary for the auditor to state in his tax audit report that the said deduction has not been made.

                                                                         Opinion                                 December 29, 1989

1.The Committee is of the opinion that the auditor is expected to follow the Guidance Note on Tax Audit under Section 44AB of the Income-tax Act, issued by the Institute of Chartered Accountants of India.

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