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CA Final · Direct Tax Laws & International Taxation · Assessment of Various Entities

Lakshmi Educational Trust, a registered non-profit organisation, has had its return selected for scrutiny. The Assessing Officer is satisfied that it committed a specified violation mentioned in section 351(1). What must the Assessing Officer do under section 270(13)?

The Assessing Officer must send a reference to the Principal Commissioner or Commissioner to withdraw approval or registration, and cannot pass the assessment order under section 270(10) without giving effect to the order passed under section 351(2)(ii)(A) or (B).

  1. AComplete the assessment under section 270(10) at once, then send a reference for withdrawal of registration
  2. BSend a reference to the Principal Commissioner or Commissioner to withdraw approval or registration, and not make the assessment order without giving effect to the order passed under section 351(2)(ii)(A) or (B)Correct
  3. CWithdraw the registration himself and then assess the income
  4. DIntimate the Central Government under the Schedule III contravention procedure and wait for its rescission order

Explanation

Under section 270(13), the Assessing Officer must send a reference to the Principal Commissioner or Commissioner for withdrawal of approval or registration. The assessment order under sub-section (10) cannot be made without giving effect to the order passed under section 351(2)(ii)(A) or (B). He has no power to withdraw registration himself, and the Schedule III route in sub-section (11) applies to different entities.

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