09. assessment ICAB, KL, Study Manual

Taxation-l Study Manual
Chapter 9
Assessment
Contents
lntroduction
Examination context
Topic List
: 9. 1 r Provisional assessment
t
9.2 , Assessment on correct return
.:
9.3 Assessment under simplified procedure
, 9.4 : Assessment on the basis of return
I g.S : Universal self assessment
i S.O , Deemed assessment for certain income of certain Persons
9 7 Spo! assessment
9.8 Assessment after hearing
9.9 , Self-assessment
i 9. lO i Self-assessment for private companies
:- :
9. | | : Assessment on the basis of report of a Chartered Accountant
' g.ti ",
Bust judgement assessment
9.1 3 Presumptive tax assessment on owners of road transPort
9.14 Variousspecialisedassessments
9. 13.1
-' Assessment of firms
: 9. tl.Z I Assessment in case of change in constitution of a firm
: g. t l.i , Ass"rr."nt in case of construction of new successor firm
9.| l.+
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Assessment in case of succession to business otherwise than on death
: 9. I3.S , Assessment in case of discontinued business
: 9. 13.6 i A.r"rr*"n. in case of partition of a Hindu undivided family
9.13.7 i Assessment in case of persons leaving Bangladesh
9. 13.6
-
. Assessment in case of income of a deceased person
9. l5 Assessment in case of income escaping assessment
: f.i6 , Limitadon for assessment
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@The lnstitute of Chanered Accountants of Bangladesh

lntroduction
Learning objectives
lllustrate the various types of assessmenl
ldentifr the conditions, rules and procedure for different classes of assessment.
Define the limitation for assessmenc
Practical significance
Assessment of income and tax liabiliry are verT significant for every assessee. There are different
classes of assessment such as provisional assessment, assessment on correct rerurn, assessment
under simplified procedures, assessment on the basis of return, universal self assessment,
deemed assessment for certain income of cenain persons, spot assessment, assessment after
hearing, assessment on the basis of report of a chartered accountanq best iudgement assessment
etc. Even there are various specialized assessments such as assessment in case of discontinued
business, persons leaving Bangladesh, deceased person, income escaping assessment etc. So there
is no way to avoid the assessment for any assessee.
For every classes of assessment there are either some conditions, rules and procedures specified
for assessee and/or for tax authorities. Some limitation for assessmenr also has significance.
Stop and think
Did you realise how important is the assessment for any assessee either individual or companyl Do
you think nobody can avoid assessment in any way if he is required to be assessed under tax law?
Working context
Assessment of tax is very important for every assessee. An assessee mus! require to be assessed in
any way. Accountants has a great role to provide the technical assistance to their client in case of
assessrnenL As there are many conditions, rules and procedures for different types of assessments,
accountants' suPPort somedme very significant to complete the assessment of their clients.
Many clients are requiring the support for correct assessment from accountants in every year.
Deailed knowledge of accountants on conditions, rules and procedures for different assessments
has the importance in case of required support for clients' tax assessment in many ways.
Syllabus links
The topics covered in this chapter have the significance for professional study as you can utilize
the knowledge throughout the application level and case study and also in your practical life.
@The Institute of Chanered Accountants of Bangladesh

l"
Examination context
Exam requirements
In the examination, candidates may be required to:
' ldentify the different classes of assessment.
. Define the provisional assessment.
. Characterise the assessment on correct return and assessment on the basis of return.
' Define the assessment under which tax liability shall be deemed as finally discharged.
. Define the specialty of universal self assessment.
. Recognise the rules and procedures for spot assessment.
. lllustrate the assessment after hearing and best iudgement assessment.
. Define the assessment on the basis of report of a chartered accountant.
. Recognise thei presumptive tax assessment on owners of road transport with the rate of tax.
. Define the assessment of a firms
. Typig the assessment in case of change in constitution of a firm and constitution of new
successor firm.
. Typify the assessment in case of succession to business otherwise than on death and
discontinued business.
. Define the assessment in case of partition of Hindu undivided family.
. Characterise the assessment in case of partition of persons leaving Bangladesh, deceased
person and income escaping assessment.
. ldentify the limitation for assessment.
Question practice
For question practice on these topics go to the suSsested answers covering this chapter.
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@The Institute of Chartered Accountants of Bangladesh

9.0 ASSESSMENT
Section Overview
) There are different classes of assessment of total income and ux payable.
) The conditions, rules and methods of various assessment are different.
It is not easy for any person to escape assessment who is required to be assessed.
There are cemain limitation of assessment.
Provisional Assessment: Sec 8 |
The Deputy Commissioner of Taxes niay, at any time after I July of the year for which the
assessment is to be made, proceed to make, in a summary manner, a provisional assessment of
the tax payable by the assessee on the basis of the return and the accounts and documents, if
any, accomPanying it and where no return has been filed, on the basis of the last assessment
including an assessment under this section.
ln making a provisional assessment under this section, the Deputy Commissioner of Taxes shall-
rectify any arithmetical errors in the return, accounts and documents;
allow, on the basis of the information available from the return, accounts and documents,
such allowances as are admissible under the Third Schedule and any loss brought forward
under section 38 or 39 or 4 l.
For the PurPoses of payment and recovery, the tax as determined to be payable upon provisional
assessmenr shall have effect as if it were determined upon regular assessmenL
The cax paid or deemed to have been paid under chapter Vll, in respect of any income
provisionally assessed under sub-section (l), shall be deemed to have been paid towards the
provisional assessment.
Any amount paid or deemed to have been paid towards provisional assessment under this
section shall be deemed to have been paid towards regular assessment; and the amounr paid or
deemed to have been paid towards provisional assessment in excess of the amount found
payable after regular assessment shall be refunded to the assessee.
Nothing done or suffered by reason or in consequence of any provisional assessment made
under this section shall preiudice the determination on merit of any issue which may arise in the
course of regular assessment.
There shall be no right ofappeal against a provisional assessmenr under this section.
Assessment on Correct Return: Sec 82
Assessment on correct return.- Where a return or a revised return has been filed under
Chapter Vlll of ITO 1984 and the DCT is satisfied, without requiring the presence of the
assessee or the production of any evidence, that the return is correct and complete, he shall
assess the total income of the assessee and determine the tax payable by him on the basis of
such return and communicate the assessment order to the assessee within thirry days next
following:
Provided thar-
(a) such return shall be filed on or before the date specified in clause (c) of sub-section (2) of
section 75:
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9.1
(a)
(b)
(l)
(4)
(s)
(6)
(7)
9.2
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@The lnstitute of Chanered Accountants of Bangladesh

9.3
Taxation-l StudyManual
(b) the amount of tax payable shall be paid on or before the date on which the return is filed; and
(c) such return does not show any loss or lesser income than the last assessed income, or
assessment on the basis of such return does not result in refund.
Assessment Under Simplified Procedure: Sec 82A:
Where, an assessee, other than a public company as defined in the Companies Act, l9l3l1994
who has prevjously been assessed for any assessment year ended on or before the thirtieth day
of June, | 995, files a return showing income for the income year relevant to the assessment year
commencing on or after the first day of July, 1995 and ending on or before the thirtieth day of
June, 1997 and the income shown in such return is higher by not less than l0% over the last
assessed income and has also increased by at least a further sum of l0% lor each preceding
assessment year in respect of which the assessment is pending, the return filed by the assessee
shall be deemed to be correct and complete, and the Deputy Commissioner of Taxes shall assess
the total income of the assessee on the basis of such return and determine the tax payable by
him on the basis of such assessment and communicate the assessment order to the assessee
within thirty days next following, provided-
(.) he has, at the time of filing such return, made payment of the tax on the basis of the
return, or taka twelve hundred, whichever is higher, and the assessment on the basis of
such return shall not result in any refund; and
(b) the net accretion of his wealth, if he is not required to submit statement of assets and
liabilities under section 75(2)(b), along with his disclosed family expenses and taxes paid
during the year, shall not exceed the income disclosed for the year and the income or
receipt, if any, exempted from tax.
Note: The assessment under this Section has expired on the assessment year 1997-98.
Universal Self Assessment: Sec 82BB
Where an assessee furnishes a correct and complete return of income the Depury
Commissioner of Taxes shall received such return himself or cause to be received by any other
official authorized by him and issue a receipt of such return and the said receipt shall be deemed
to be an order of assessment for the assessment year for which the return is filed.
A return shatl be taken to be complete, if it is filed in accordance with the provisions of sub-
section (2) of section 75 and tax has been paid as per section 74.
However, tax audit will be applicable in selective cases.
No question as to the source of investment made by a new assessee deriving income from
business or profession shall be raised, if he shows income at least not less than twenty five
percent of the capital invested in business or profession and pays tax on such income before
filing return.
The initial capital investment or any fraction thereof shall not be transferred in any manner or
lent out within five years from the end of the assessment year in respect of which assesse's
return of income has been filed under this section.
9.4
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Taxation- | Study Manual
st. # Head ofTDS
Ket. ot
Sec/Rule
TDS Rate / Amount
I Payments for Supply
of Goods, Execution
of Contracts
U/S 52 Upto Tk. 2,00,000/-- Nil.
From 2,00,00f to Tk. 5,00,0001- ---------l%
From 5,00,001 to Tk. 15,00,0001-------2.5%
From 15,00,001 to Tk. 25,00,000/------3.5%
From 25,00,001 to Tk. 3,00,00,000 ------4%
where the payment exceeds Tk. 3,00,00,000
----------5%
in case of oil supplied by oil marketing
companies upto Tk. 2,00,000------------ Nil
where the payment exceed Tk. 2,00,000-----
---0.7s%
2. Royalty and
Technical Know-
How Fee
u/s s2A(2) 0%
3. C learing and
Forwarding Agents
U/S 52AAv{ t0%
4. Cigarette
Manufacturers
UiS 528 6% of the value of the banderols
5. LomPensatron
against acquisition of
ProPerty
u/s 52c (a) 2% of the amount of such compensarion
against the immovable property situated
within City Corporation, Paurashava or
Cantonment Board
(b) l% of the amount of such compensation
against the immovable property situated
outside the iurisdiction of City
Corporation, Paurashava or
Cantonment Board
5. Foreign technician
serving in diamond
cufting industries
u/s 520 s%
Collection of Tax
from lmponers
u/s 53 5%
8. Collection of Tax
from Shipping
Business of a
Resident
U/S 53AA 5% of total freight received or receivable in
or out of Bangladesh
3% of totzl freight received or receivable
from services rendered between two or
more foreign countries
9.5 Deemed Assessment for Certain lncome of Certain Persons: Sec 82C
Under the' provisions of this section tax deducted or collected at source in the following
cases is treated as final discharge of tax liability:
Table showing the TDS deemed to be the final discharge of tax liability
I
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@The Institute ofChartered Accountants of Bangladesh
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sr. # Head ofTDS Ref. of
Sec/Rule
TDS Rate / Amount
.). Deduction of Tax
from Income
Derived on Account
of Expon of
Manpower
U/S 538 lo%
t0. Deduction of Tax
fr<irn Export of
Knit-wear and
woven garmen$,
terry towel, jute
goods, frozen food,
vegetables, leather
soods, oacked food
U/S 53BB 0.50% of the toral exPort proceeds
ll Collection of Tax
from Member of
Stock Exchanges
U/S 53BBB 0.0s%
12. Collection of Tax
on Sale Price of
Goods or Property
Sold by Public
Auction
u/s 53c 5% of sale price
tJ. Deduction or
Collection of Tax at
Source from
Courier Business of
a Non-Resident
u/s 53cc | 5% on the amount of service charge
accrued.
t4. Collection of Tax
from Persons
Engaged in Real
Estate or Land
Development
Business
U/S 53FF D Tk. 2,000 per square meter for building
or aparcment situated at Gulshan.Model
Town, Bannani, Baridhara, Defense
Of{icers Housing Society (DOHS),
Dhanmondi Residential Area, Lalmatia
Housing Society, Uttara Model Town,
Bashundhura Residential Area. Dhaka
Cantonment Area, otijeel Commercial
Area, Dilkusha Commercial Area,
Karwan Bazar Commercial Area. of
Dhaka and Khulshi Residental Area,
Panchlaish Residential Area and Agrabad
of Chittagong.
(ii) Tk. 800 hundred per square meter
where the building of apartment is
situated in areas other than areas
mentioned in sub-clause (i)
7% of deed value from September l, 2009 in
case of property situated in any city
corporadon, paurashave or cantonment
board.
I
I l% ofdeed value from September l,2009 in
I case of property in situated in places other
I than any city corporation, paurashava or
I cantonment board.

st. # Head of TDS
Ref. of
Sec/Rule
TDS Rate / Amount
t5. lnsurance
Commission
u/s 53G 5%
or
Fees of Surveyors of
General Insurance
Company
U/S 53GG t5%
t7. Collection of Tax
on Transfer, etc. of
Property
u/s 53H 5% of deed value up to 3 l" August, 2009
ano
2% ol deed value from l" September,2009
in case of property situated in ay city
corporation, paurashava or cantonment
board.
l% of deed value from l" September, 2009
in case of propefty situated in areas other
than any city corporation, paurashave or
cantonment board.
t8 Collection of tax
from sale of share at
a premium over face
value
u/s 531 3%
I t9. Lollectron ot tax
from transfer of
shares by the
sPonsor
shareholders of a
company listed on
stock exchanqe
UiS 53M 5%
20. lncome from
Winninss
u/s 55 20%
However, an assessee shall not be allowed to take into account the full amount of income or
receipts from which tax has been collected or deducted at source and considered as final
assessmenr settling the tax liability, in explaining the nature and source of any sum, investmen!
money, valuable anicles, excess expenditure referred to in S. 19. The income on payments or
receipts represented by the tax deducted at source is only allowed as source of fund for
explaining any investment etc.
For the purpose of determining the share of a panner of a firm out of such income of the firm as
is determined under this section. the said income of the firm shall be taken to be an amount
which, if taxed at the rare or rates, orher than the rates applicable to income chargeable to tax
under this section, would have resulted in tax liability equal to the tax payable in respect of
income under this section.
Comments:
The provisions to this section have been ill framed and ill phrased. The language is incorrect and
incomprehensive too. However, from the spirit of the legislation, explanation can be like that-
Tax deducted from a contractors bill of Tk. 50,00,000 at the rate of 4% amounting to Tk.
2,00,000. Assuming rhat rhis Tk. 2,00,000 is his tax liability on the profit earned on the contracg
his profit can be worked out provided his tax rate is known. Since it is not known, let us assume
that his average tax rate is 20% of that income and therefore, income on the contract should be
2,00,000* 2014 = Tk. 10,00,000 since, tax of Tk. 2,00,000 has been already deducted at source
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@The Institute of Chartered Accountants of Banghdesh

9.6
(t)
the contractor can show up to Tk. 8,00,000 whenever asked by tax authorities to explain rhe
source of income or investments under S. 19. The amount so calculated may however, vary
depending on the tax rate of the assessee. In the case of companies for instance, the rates are
27.5% or 37.5% or 42.5%in case of banks insurance and other financial Institutions. Under this
scheme tax is first determined and collected. then income is determined.
In all these cases mentioned above are determined and collected before the determination of
income which clearly depara from the basic principle of income tax that is imposed in relation to
income. In ofher cases of deduction or collection at source the assessee can take this into
account and upon final assessment may be asked to pay more or may be given refund. But the
scope of this treatment has been denied in the above mentioned cases which is another
departure from natural iustice.
Spot Assessment: Sec 82D and Rule - 38B:
Notwithstanding an)'thing contained in the Ordinance, where an assessee, not beint a company,
who has not previously been assessed under the Ordinance, carrying on any business or
profession in any shoppint centre or commercial market or having a small establishment, the
Deputy Commissioner of Taxes may fix the tax payable by him in such manner and at such rate
as may be prescribed and the receipt obtained for payment of such tax shall be deemed to be an
order of assessment under section 82.[Secrion 82D].
Rule 388:
(a) An assessee carrying on business within the limits of any City Corporation shall pay tax at
the following rates-
Rate of tax per annum
(2)
(i) Where the initial capital does not
exceed Tk.5.00.000/-
(iD lf the initial capital exceeds Tk.5,00,000f
but does not exceed Tk.10,00,000/-
(b) An assessee carrying on business within the limits of a Municipality of any
Headquarter or District Headquarter shall pay tax at the following rates:-
Tk. t,200/-
Tk.3,500/-
Divisional
Rate of tax per annum
Tk. r,200/-
Tk.2.500/-
Tk.2,000/-
Tk.1.200/-
(i) lf the initial capital investment does not
exceed Tk.5,00,000/-
(ii) lf the initial capital exceeds Tk.5,00,000/-
but does not exceed Tk. | 0.00,000/-
(c) An assessee carrying on profession as a lawyer or a doctor for a period exceeding five years
but not exceeding l0 years shall pay tax at the following rates:-
Rate of tax Der annum
(i) Where profession is carried on within the
limia of any City Corporation
(ii) Where profession is carried on in
any other area
(3) The assessee shall, with the help of the Deputy Commissioner of Taxes, fill up a return of
income in form B as prescribed in rule 24(l), which can be had from the Deputy Commissioner
of Taxes, and submit the same to the Deputy Commissioner of Taxes on the spot.
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9.7
(t)
(4) The tax fixed under rule 388(2) shall remain in force for two subsequent assessment years, and
the receipt of the payment of such tax shall be deemed to be an order of assessment under
section 82 of the Ordinance.
Assessment After Hearing: Sec 83
Where a return or revised return has been filed under Chapter Vlll and the Deputy
Commissioner of Taxes is not satisfied without requiring rhe presence of the person who filed
the return or the production of evidence that the return is correct and complete, he shall serve
on such Person a notice requiring him, on a date to be therein specified, to appear before the
Deputy Commissioner of Taxes, or to produce or cause to be produced before him or at his
office, any evidence in support ofthe return.
(2) The Deputy Commissioner of Taxes shall, after hearing rhe person appearing, or considering the
evidence produced in pursuance of the notice under section 83(l) and also considering such
other evidence, if any, as he may require on specified points, by an order in writing assess, within
thirty days after the completion of the hearing or consideration, as the case may be, the total
income of the assessee and determine the sum payable by him on the basis of such assessment,
and communicate the order to rhe assessee within thirty days next following.
Students should carefully note that for completion of assessment u/s 83(2), the Deputy
Commissioner should issue the following notices.
(a) Notice u/s 83(l)- Requiring further information about the return filed
(b) Notice u/s 79- Production of books of accounrs and various sratemenc.
ln case of failure to serve any of the above notices, the assessment made under this section is
rendered defective and unenforceable. lfthe assessee files a revised return before the assessment
is completed, the DCT should issue fresh notices u/s 83(l) and79.
Assessment on the Basis of Report of a Chartered Accountant: Sec 83Afuq
Where a return or revised return is filed under Chapter Vll by an assessee being a company and
the Board has reasonable cause to believe that the return or revised return is incorrect or
incomplete, the Board may appoint a registered chartered accountant to examine the accounts of
that assessee.
The chanered accountant appointed under sub-seca,on g34lA(l) shall exercise the powers and
functions of the Depury Commissioner of Taxes as referred to in section 79 and sections ll3(a),
(b), (d) and (e).
The chanered accountang after examination of the accounts of that assessee, shall submit a repor!
in writing to the Board alongwith {indings within a rime as may be specified by the Board.
On receipt of the report referred to in subsection 83AAA(3), the Board shall fonhwith forward
the report to the concerned Deputy Commissioner of Taxes for consideration.
On receipt of the report under sub-section 83AAA(4), the Deputy Commissioner of Taxes shall
serve a notice upon the assessee under section 83( | ).
The Deputy Commissioner of Taxes shall, after hearing the person appearing and considering the
evidences produced including the findings stated in the report received under secdon 83AAA(5)
and also considering the other evidences, by an order in writing, assess within thirty days after the
completion of hearing or consideration, as the case may be, the total income of an assessee and
shall determine the sum papble by the assessee on the basis of such assessmeng and communicate
the said order to the assessee within thirty days from the date of such order.
9.8
(t)
(2)
(3)
(4)
(s)
(6)
@The Institute of Chanered Accountants of Bangladesh

9.9 Best Judgement Assessment: Sec 84
( | ) Where any person fails-
(a) to file the rerurn required by a notice under section 77 and has not filed a return or
revised return under section 78; or
(b) to comp|y with the requiremenls of a notice under section 79 or 80; or
(c) to comply with the requirements of a notice under section 83(l);
the Deputy Commissioner of Taxes shall, by an order in writing, assess the total income of the
assessee to the best of his iudgement and determine the sum payable by the assessee on the basis
of such assessment; and in the case of a firm, may refuse to register it or may cancel its registration
if is already registered, and communicate such order to the assessee within 30 days next following.
[Section 84(2)].
(2) Where, in the opinion of the Board, a best iudgement assessment made by a Deputy Commissioner
of Taxes under section 84( | ) shows lack of proper evaluation of legal and factual aspects of the case
which has resulted in an arbitrary and iniudicious assessment, the action leading to such assessment
made by the said Deputy Commissioner of Taxes shall be construed as misconduct.[Section 84(2)].
9. | 0 Presumptive Tax Assessment on Owners of Road Transport
The Government has exempted income from bus, mini-bus, coaster, prime mover, truck, tank
lorries, pick-up van, human hauler, maxi auto-rickshaw used for transPortation of goods plying for
hire provided the owner of the vehicle/vehicles pays tax on presumPtive basis at the following rates,
meniioned in S.R.O. No.22l-U99 dated 27-07-99 and SRO No.202-U2000 dated 03.07.2000:'
A. Rate of presumptive tax in rhe case of owners of bus, mini-bus, coaster, prime mover, truck, tank
lorry, pick-up van, maxi or auto'rickshaw used for transportation of goods:-
L For each bus having capacity of exceeding 52 seats
2. For each bus having capacity up to 52 seats
3. For each air-conditioned bus
4. For each mini-bus or coaster whether air-conditioned or not
5. Taxi Cab -AC
6. Taxi Cab -Non AC
7. For each prime-mover used as carrier of conQiner
8. For each truck or tank lorry having capacity of exceeding 5 tons
9. For each truck or tank lorry having capacity of one and half ton
but not exceeding 5 tons
10. For each truck having capaciry up to I and half ton or each
pick-up van and all kinds of human hauler' maxi or
auto-rickshaw for transportation of goods
Rate of Tax
: Tk.5,000/-
: Tk.4,000/-
: Tk.4,500/-
: Tk.2,700/-
: Tk. 3,500/-
: Tk. 2,500/-
: Tk.5,000/-
: Tk.4,000f
: Tk.2,500/-
: Tk.750/-
B. Rate of presumptive tax in the case of owners of bus, mini-bus, coaster, prime mover' truck, tank
lorry, pick-up van, maxi or auto-rickshaw used for transportation of goods after the expiry of ten years
from the date of regisrationi
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l. For each bus having capaciry of exceedint 52 seats: Tk.2,O0O/-
2. For each bus having capacity up ro 52 sears
3. For each air-conditioned bus
4. For each mini-bus or coaster whether air-conditioneo or not
5. For each prime-mover used as carrier of container: Tk.2,500/_
6. For each truck or tank lorry having capacity of exceeding 5 tons
7. For each truck or tank lorry having capacity of exceeding one and harf
ton but not exceeding 5 tons
8. For each truck having capacity up to one and half ton or each
pick-up van and all kinds of human hauler, maxi or
auto-rickshaw for transportation of goods
Rate ofTax
: Tk.1,500/-
: Tk.l,800f
: Tk.1,000/-
: Tk.2,000/-
: Tk.1,0001
: Tk.300/-
C' No question will be raised by the Deputy Commissioner of Taxes as to the source of investment
in bus, mini-bus, coaster, prime mover, truck, tank lorry, pick-up van, maxi or auto_rickshaw
used for transporcation of goods if additional tax at 2OO% of the tax mentioned in items A and B
above is paid as tax on the investment at the time of the {irst registration of such transport.
Various Specialised Assessments
9. I l. I Assessment of Firms: Sec 85
(l) Notwithstanding anything contained in the ordinance, where the assessee is a firm and the total
income of the firm has been assessed under section 82, 83, or 84, as the case may be, the tax
payable by the firm shall be determined on the basis of the total income of che firm.
(2) Whenever any determination is made in accordance with the provisions of section g5(l), the
Deputy commissioner of raxes shail, by an order in writing, notify to the firm-
(a) rhe amount of tax payable by ig if any;
(b) the amount of the total income on which the determination has been based; and
(c) the apponionment of the amount of income between the severar partners.
9. | 1.2 Assessment in case of change in constitution of a Firm: sec g5
(l) Where, at the time of assessment of a firm; it is found that a change has occurred in the
constitution of the firm, the assessment shall be made on the firm as constituted at the time of
making the ?rssessmenu
Provided that
(") the income of the year shall, for the purpose of inclusion in the total income of the
Paftners' be apportioned between the partners who, in such income yeart were entided
to receive the same; and
(b) when the tax assessed upon a partner cannot be recovered from him, it shall be
recovered from the firm as constituted at the time of making the assessment.
For the purposes ofthis section, there is a change in the constitution ofa firm-
(") where all the panners continue with a change in their respecdve shares or in the shares of
some of them. or
(b) where one or more persons who were partners continue to be so with a change by
cessation of one or more panners or addition of one or more new paftners.
(2)
OThe Insdrute of Chanered Accounans of Bangladesh

9. | 1.3 Assessment in Case of Constitution of New Successor Firm: Sec 87
Where, at the time of assessment on a firm, it is found that a new firm has been constituted to
succeed the firm to which the assessment relates and it cannot be covered by section 86,
separate assessments shall be made on the predecessor firm and the successor firm in
accordance with the provisions of section 88 relating to assessment in case of succession to
business.
9. I 1.4 Assessment in Case of Succession to Business Otherwise than on Death: Sec 88
(l) Where, a person, carrying on any business or profession, has been succeeded therein otherwise
than on death by another person in any income year, and the successor continues to carry on
that business or profession-
(a) the predecessor shall be assessed, in respect of the income of the income year in which
the succession took place, for the period up to the date of succession, and
(b) the successor shall be assessed, in respect of the income of the income year, for the
period after the date of succession.
(2) Notwithstanding anything contained in section 88(l), where the predecessor cannot be found, the
assessment of the income year in which the succession took place up to the date of succession anct
of the income year or years preceding that year shall be made on the successor in the like manner
and to the same extent as it would have been made on the predecessor; and the provisions of the
Ordinance shall, so far as may be, apply accordingly.
(3) Where any sum payable under this section in respect of the income of a business or profession
cannot be recovered from the predecessor, the Deputy Commissioner of Taxes shall record a
finding to that effect, and thereafter the sum payable by the predecessor shall be payable by and
recoverable from the successor who shall be entitled to recover it from the predecessor.
9. | 1.5 Assessment in Case of Discontinued Business: Sec 89
( | ) Without preludice to the provision of section 87, where any business or profession is discontinued
in any financial year, and assessment may be made in that year, notwithstanding anything contained in
section 16, on the basis of the total income of the period between the end of the income year and
the date of such discontinuance in addition to the assessment, if any, made on the basis of the
income year.
(2, Any person discontinuing any business or profession in any financial year shall give to the Deputy
Commissioner of Taxes a notice of such discontinuance within fifteen days thereof; and such notice
shall be accompanied by a return of total income in respect of the period between the end of the
income year and the date of such discontinuance and that financial year shall be deemed to be the
assessment year in respect of the income of the said period.
(3) Where, a person fails to give the notice required by sub-section 89(2), the Deputy Commissioner of
Taxes may direct that a sum shall be recovered from him by way of penalty not exceeding the
amount of tax subsequently assessed on him in respect of any income from the business or
profession up to the date of its discontinuance.
(4) Where, an assessment is to be made under section 89(l), the Deputy Commissioner of Taxes may
serve-
(a) on the person whose income is to be assessedi
(b) in the case of a firm, on the person who was a partner of the firm at the time of
discontinuance of the business or profession; and
(.) in the case of a company, on the principal ofticer of the company; a notice to furnish
within such time, not being less than seven days, a return of his total income giving such
particulars and information as are required to be furnished with a return to be filed
under section 75 along with such other particulars, records and documents as may be
specified in the notice.
(5) The provisions of the Ordinance shall, so far as may be, apply to a notice under section 89(4) for the
purpose of assessment of tax as if it were a notice under section 77.
flttll. :.--

(4)
9. | 1.6 Assessment in Case of Partition of a Hindu Uniivided Family (HUF) : Sec 90
(l) A Hindu family hitheno assessed as a Hindu undivided family shall be deemed, for the purposes of
the Ordinance, to continue to be a Hindu undivided family except where, and in so far as, a finding
of panition has been given under this section in respect of that family.
(2) Where, at the time of an assessment of a Hindu undivided family, ir is claimed by any member
thereof that a panition has taken place amongst the members of rhe family, the Deputy
Commissioner of Taxes shall make an enquiry thereinrc after giving notice ro all the members of the
family.
(3) On the completion of the enquiry, the Deputy Commissioner of Taxes shall record a finding as to
whether there has been a parcition of the ioint family property, and, if there has been such a
partirion, the date on which it has taken place.
In the case of a finding under section 90(3) that the partition of the undivided family took place after
the expiry of the income year, the total income of the income year of the undivided family shall be
assessed as if no paftition has taken place; and each member or group of members of the family
shall, in addition to any tax for which he or it may be separately liable, be jointly and severally liable
for the tax on the income of the family so assessed.
In the case of finding under section 90(3) that the partition of the undivided family rook place
during the income year, the rotal income of the undivided family in respect of the period up to
the date of panition shall be assessed as if no partition had taken place; and each member or
group of members of the family shall, in addition to any tax for which he or it may be separately
liable, be iointly and severally liable for the tax on the income of that period as so assessed.
Norwithstanding anything coneined in this section, if the Depury Commissioner of Taxes finds
after completion of the assessment of Hindu undivided family that the family has already effected
a partition,-the tax shall be recoverable from every person who was a member of the family
before the panition; and every such person shall be joindy and severally liable for tax on the
income of the family so assessed.
For the purposes of this section, the several liability of any member or troup of members of a
Hindu undivided family shall be computed according to the partidon of the property of the
undivided family allotted to him or it at the panition.
The provisions of this section shall, so far as may be, apply in relation to the levy and collection
of any penalty, interesg fine or other sum in respect of any period up to rhe date of the partition
of a Hindu undivided family as they apply in relation to levy and collection of tax in respect of any
such period.
9. | 1.7 Assessment in Case of Persons Leaving Bancladesh: Sec 9l
(l) Where it appears to the Deputy Commissioner of Tax that any person may leave Bangladesh
during the current financial year or shonly after its expiry and that he has no intenrion of
returning an assessment may be made in that year, notwithstanding anything contained in section
| 6, on the basis of the total income of such person if-
(a) he has been previously assessed, for the period from the expiry of the last income year
of wh.ich income has been assessed to the probable date of his departure from
Bangladesh; and
(b) he has not been previously assessed, of the entire period of his stay in Bangladesh up to
the probable date of his depanure therefrom.
Assessment under secdon 9l (l) shdl be made-
(a) in respect of each completed income year included in the period referred to in section
9 | ( | ), at the rate at which tax would have been charged had it been fully assessed; and
(s)
(5)
(7
(8)
(2)
i'tl @The Institute of Chanered Accountants of Bangladesh

(3)
(b) in respect of the period from the expiry of the last of the completed income years to
the probable date of departure, at the rate in force for the financial year in which such
assessment is made and that financial year shall be deemed to be the assessment year in
respect of the income of the said period.
For the purpose of making an assessment under this section, the Deputy Commissioner of Taxes
may serve a notice upon the person concerned requiring him to file, within such time, not being
less than seven days, as may be specified in the notice-
(a) a return in the same form and verified in the same manner as a return under section 75
setting forth, along with such other particulars as may be required by the notice, his
total income for each of the completed income years comprised in the relevant period
referred to in section 9 | ( | ); and
(b) an estimate of his total income for the period from the expiry of the last of such
completed income year to the probable date of his departure from Bangladesh.
All the provisions of the Ordinance shall, so far as may, apply to the notice. under section 9 | (3)
for purpose of assessment of tax as if it were a notice under section 77.
Nothing in this section shall be deemed to authorise a Deputy Commissioner of Taxes to assess
any income which has escaped assessment or has been under assessed or has been assessed at
too low a rate or has been the subject of excessive relief under the Ordinance but in respect of
which he is debarred from issuing a notice under section 93.
9. | 1.8 Assessment in Case of Income of a Deceased Person: Sec 92
(l) Where a person dies, his legal representative shall be liable to pay any tax or other sum payable
under the Ordinance which the deceased would have been liable to pay if he had not died, in the like
manner and to the same extenr as the deceased; and the legal representative of the deceased shall,
for the purposes of the Ordinance, be deemed to an assessee. However, before deeming the legal
representative of the deceased to be an assessee, a notice to that effect shall be issued to him by the
Deputy Commissioner of Taxes.
(2) For the purposes of making an assessmenr of the income of the deceased and recovery of tax-
(") any proceeding taken against the deceased before his death shall be deemed to have been
taken against the legal represenhtive and may be continued from the stage at which it stood
on the date of the death of the deceased; and
(b) any proceeding which could have been taken against the deceased, if he had not died, may be
taken against the legal represenntive; and all the provisions of the Ordinance shall, so far as
may be, apply accordingly.
(3) The liability of legal represenrative under the Ordinance shall be limited to the extent to which
the estate of the deceased is capable of meeting the liability.
(4) For the purposes of section 92 and other provisions of the Ordinance in which the rights,
interesr and liabilities of the deceased are involved, 'legal representative' includes an executor, an
administrator and any person administering the estate of the deceased.
9. | 2 Assessment in Case of Income Escaping Assessment: Sec 93
(l) li for any reason, any income chargeable to tax for any assessment year has escaped assessment
or has been under assessed or has been assessed at too low a rate or has been the sublect
excessive relief or refund under the Ordinance, the Deputy Commissioner of Taxes may issue a
norice to rhe assessee containing all or any of the requirements which may be included in a
notice under section 77 and may proceed to assess or determine, by an order in writing, the
total income of the assessee or the tax payable by him, as the case may be, and all the provision
of this Ordnance shall, so far as may be, apply accordingly. However, the tax shall be charged at
the rate or rates applicable ro the assessment year fbr which the assessment is made.
(2) No proceeding under section 93(l) shall be initiated unless definite information has come into
the possession of the Deputy Commissioner of Taxes and he has obtained the previous approval
, 177
(4)
(s)

I Study Manual
of the InspectingJoint Commissioner in writing to do so, except in a case where a return has
been filed under section 75 or77.
not
A notice under section 93( l) may be issued by the Deputy Commissioner of Taxes-
in any case in which he has reason to believe that the assessee or any other person on
his behalf has not filed a return under section 75 or 77, at any rime;
in any case in which he has reason to believe that the assessee has for any assessment
year concealed the par-ticulars of his income or furnished inaccurate particulars rhereof
or omitted or failed to disclose all material facts necessary for the assessment for such
year, within five years from the end of the assessment year for which the assessment is
to be made.
However, in a case where a fresh assessment is made for any assessment year in pursuance of an
order under sections 120, l2lA, 156 or 159, the period offive years referred to in this ctause
shall commence from the end of the year in which the fresh assessment is made.
in any other case, within two years from the end of the assessment year for which the
assessment is to be made.
ln computing the period of limitation for the purpose of making an assessment or taking any
other Proceedings under che Ordinance, the period, if any, for which such assessment or orher
proceedings has been stayed by any Court, Tribunal or any other aurhority, shall be excluded.
Notwithstanding anything contained in section 93(3), where an assessment or any order has
been annulled, set aside, cancelled or modified, the concerned income tax authority may start
the proceedings from the state next preceding the stage at which such annulment, seuing aside,
cancellation or modification took place, and nothing contained in the Ordinance shall render
necessary the re-issue of any notice which has already been issued or rhe re-furnishing or refiling
of any return, setement or other paniculars which has already been furnished or filed, as the
case may De.
9,l3 Limitation for Assessment: Sec 94
(l) Subject to the provisions of sections 94(2) and (3), no order of assessmenr under the provisions
of this Chapter in respect of any income shall be made after the expiry of six months from the
end of the assessment year in which the income was first assessable.
(lA) Notwithstanding anything contained in section 94(l), no order of assessment under sections
82BB shall be made-
(t) after the expiry of two years from the end of the assessmenr year in which the income was first
assessable; and
(b) after the expiry of the period of fifteen months from the end of the monrh in which the return
is submitted, whichever is earlier.
(2) Notwithstanding anything contained in section 94(l), assessment under section 93 may be made-
(a) in the cases falling under section 93(3)(a) and (b), within two years from the end of the year in
which notice under the said section was issued; and
(b) in the cases falling under secdon 93(3)(c), within one year from the end of the year in which
notice under the said section was issued.
(3) Notwithstanding anything contained in section 94, limiting the time within which any acrion may
be taken, or any order or assessment may be made, order or assessment, as the case may be, to
be made on the assessee or any other person in consequence of, or to give effect to, any finding
ordirectioncontainedinanorderundersection 120, l2l,152E,156, 16l or 162 or.inthecase
of a firm, an assessment to be made on a partner of a firm in consequence of an assessment
made on the firm, may be made within 30 days from the date on which the order was
communicated and such revised order shall be communicated to the assessee within thirry days
(a)
(b)
(c)
-'t'' @The Institute of Chartered Accountants of Bangladesh

next following. However, where an order of assessment has been set aside by any authority in
that case the assessment shall be made within forty five days from the date on which the order
was communicated to him.
EXPLANATIONA l: Where, by an order under sections 120, I 2lA, | 56, | 59, | 6 | or 162, any income
is excluded from the total income of the assessee for an assessment year, and another assessment of
such income for another assessment year shall, for the purposes of this section, be deemed to be one
made in conseguence of, or to give effect to, any finding or direction contained in the said order.
EXPHNATION ll: Where, by an order under sections 1 20, l 2lA, 1 56, 159, l 6l or 162, any income is
excluded from the total income of one person and held to be the income of another person, an
assessment of such income of such other person, shall, for the purposes of this section, be deemed to
be one made in consequence of or to give effect to, any finding or direction contained in the said
order.
Where the Deputy Commissioner of Taxes fails to give effect to any finding or direcdon
contained in an order referred to in section 94(3) within the period stipulated therein, such
hilure of the Deputy Commissioner of Taxes shall be construed as misconduct.
(4)
@The lnstjtute of Chanered Accountants of Bangladesh
i'l| 1..

Taxation- I Study Manual
]t|ilsr*Pr:
Chapter l0
lmposition of Penalty
Contents
lntroduction
Examination context
Topic List
l0.l Penatiy ior not mainiaining iccorna in the pres.ibed m;nne;
10.2 Penalty for faiiure io frle return, ieriificiti, siitement, accounts or infoimation
iO.l PenaltyfoaGingfakeTax-payeiiid6niification trturnber
i-i0.4 - Faituie to pay-aavarrce tax -
: 10.5 Penalty for non-compliance with notice
; I 0.6 Failure to pay tax on the basis of return
1o.i -eeni-liyioiconiealrnent
of inaome -
10.8 , Penalty for default in payment of tax
: tO.9 g-arto imp;siiion of pen^olcy without hearing
- tOL O previous approval of 'rnspecting joinr Commissioner for imposing pen"lt - - --_
riDT I Ten-alcy to be with-pre;uaiceto o$"r |i..biliry-
_--
- i
, 10. l2 Orders of Appellate Joint Commissioner, eommissioner or Appef f xe-fii6u;tl ro
, __ , ,!_"_lgl! !9__D_"gt{I Commlssioner of Taxes
f,*llrl
@The lnstitute of Chartered Accountants of Bangladesh

09. assessment ICAB, KL, Study Manual

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09. assessment ICAB, KL, Study Manual