Section 44AB of the Income Tax Act

Income-tax Act, 2025: s.63

Section 44AB of the Income-tax Act, 1961 corresponds to section 63 (Tax Audit) of the Income-tax Act, 2025.

Read section 63 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 44AB is Ashok Pai v. CIT (292 ITR 11), cited in 812 of the 2,486 judgments on BharatTax that turn on this section.

Leading authorities on Section 44AB

Ashok Pai v. CIT
292 ITR 11 · 2007 · Supreme Court
812
citing judgments

“Concealment of particulars of income” and “furnishing inaccurate particulars of income” are two distinct offences under Section 271(1)(c) of the Income Tax Act. A penalty cannot be levied under one limb if the show cause notice or basis for penalty specifies the other, as this constitutes a complete variance in the reasons for assuming jurisdiction.

MALPE VISHWANATH ACHARYA AND OTHERS v. STATE OF MAHARASHTRA AND ANOTHER. 365 32
9 SCC 1 · 2018 · Supreme Court
533
citing judgments
Saurashtra Cement and Chemical Industries Ltd. v. CIT
213 ITR 523 · 1995 · High Court
311
citing judgments

Expenditure is deductible in the year it is determined and crystallised as a liability, even if it relates to a transaction of an earlier year, provided accounts are maintained on a mercantile basis.

CIT v. Vijay M. Mistry Construction Ltd.
355 ITR 498 · 2013 · High Court
252
citing judgments

In cases of alleged bogus or hawala purchases where the existence of transactions is not entirely denied, only the profit element embedded in such purchases, and not the entire purchase price, can be added to the assessee's income. The focus is on determining a reasonable profit percentage for such additions.

Mahindra and Mahindra Ltd. v. DCIT
30 SOT 374 · 2009 · ITAT
201
citing judgments

The Commissioner of Income Tax (Appeals) cannot expand the scope of an assessment or improve the Assessing Officer's case in a manner that usurps the revisional power of the Commissioner of Income Tax under Section 263 of the Income-tax Act.

Chandra Kishore Jha v. Mahavir Prasad
8 SCC 266 · 1999 · Supreme Court
163
citing judgments

If a statute or law prescribes that a thing must be done in a particular manner, then it must be done in that manner alone and in no other way. This principle mandates strict adherence to statutory procedures.

CIT v. Contimeters Electricals (P.) Ltd.
317 ITR 249 · 2009 · High Court
140
citing judgments

The requirement to file an audit report along with the return of income under section 80-IA(7) and similar provisions is directory, not mandatory. Such a report suffices if filed at any time before the assessment is framed.

Vijay Trading Co. v. ITO
388 ITR 377 · 2016 · High Court
119
citing judgments

When purchases are found bogus, only the profit element embedded therein, and not the entire purchase value, can be added to the assessee's income.

CIT v. Berger Paints (India) Ltd.
254 ITR 503 · 2002 · High Court
118
citing judgments

A deduction claimed under Section 80-IB (or 80-IA) cannot be denied solely on the ground of non-filing or delayed filing of the audit report in Form 10CCB, as such procedural requirements can be treated as directory, and delays may be condoned.

Surajmal Parsuram Todi v. CIT
222 ITR 691 · 1996 · High Court
114
citing judgments

A penalty under Section 271B for failure to get accounts audited cannot be levied if a penalty under Section 271A has already been imposed for non-maintenance of books of account.

Judgments on Section 44AB

Ripalbhai Bhagavanjibhai Modi, Bhatiya vs. Additional / Joint / Deputy / Assistant Commissioner of Income Tax, Income-Tax Officer, NFAC, Delhi

In the result, appeal filed by the assessee, is allowed

ITA 923/RJT/2026[2017-18]Status: DisposedITAT Rajkot19 Aug 2026AY 2017-18

Bench: Dr. Arjun Lal Sainiआयकरअपीलसं./Ita No. 923/Rjt/2026 [ "नधा"रणवष"/Assessment Year: 2017-18 ] Ripal Bhagavanjibhai Modi, Additional / Joint / Deputy Mahesh N. Paun, Advocate, /Assistant Commissioner Of Vs. Taxation Consultant Income Tax, Shreeji Chambers, 17-Nava Income-Tax Officer, National Para, Near S.B.I. (Adb), Jam- Faceless Assessment Centre, Khambhaliya, Gujarat-361305 Delhi-110003 "थायी लेखा सं./जी आइ आर सं./Pan/Gir No.: Agupm1427F (अपीलाथ"/Assessee) (""यथ"/Respondent) Assessee By : Shri Mahesh Paun, Ld. Ar Respondent By : Shri Shishir Kumar, Ld. Sr. Dr Date Of Hearing : 30/07/2026 Date Of Pronouncement : 19/08/2026 :: Order :: Per, Dr. Arjun Lal Saini, Am: Captioned Appeal Filed By The Assessee, Pertaining To Assessment Year (Ay) 2017-18, Is Directed Against The Order Passed Under Section 250 Of The Income-Tax Act, 1961 (Hereinafter Referred To As ‘The Act’) By The National Faceless Appeal Centre (Nac) Delhi/Commissioner Of Income-Tax (Appeals) [In Short ‘Nfac/Ld.Cit(A)’], Dated 23.04.2026, Which In Turn Arises Out Of Penalty Order Passed By The Assessing Officer U/S 271B Of The Income Tax Act , Dated 21.08.2025. 2. Although, This Appeal Filed By The Assessee, For The Assessment Year 2017-18, Contains Multiple Ground Of Appeals, However, At The Time Of Hearing

For Appellant: Shri Mahesh Paun, Ld. ARFor Respondent: Shri Shishir Kumar, Ld. Sr. DR
Section 139Section 147Section 148Section 250Section 271BSection 274Section 44A