Section 140 of the Act provides that in case of company the return is required to be verified by the managing director (MD) thereof. Where the MD is not able to verify for any unavoidable reason or where there is no MD, any director of the company can verify the return. It is also provided that in case of a company in whose case application for insolvency resolution process has been admitted by the Adjudicating Authority (AA) under the Insolvency and Bankruptcy Code, 2016 (IBC), the return has to be verified by the insolvency professional appointed by such AA. Similarly, in case of a limited liability partnership (LLP), the return has to be verified by the designated partner of the LLP or by any partner, in case there is no such designated partner.
Therefore, it is proposed to amend clause (c) and (cd) of section 140 of the Act so as to enable any other person, as may be prescribed by the Board to verify the return of income in the cases of a company and a limited liability partnership.
Further, section 288 of the Act provides for the persons entitled to appear before any Income-tax Authority or the Appellate Tribunal, on behalf of an assessee, as its “authorised representative”, in connection with any proceedings under that Act. While the IBC empowers the Insolvency Professional or the Administrator to exercise the powers of the Board of Directors or corporate debtor, it has been reported that lack of explicit reference in section 288 of the Act for an Insolvency Professional to act as an authorised representative of the corporate debtor has been raising certain practical difficulties.
Therefore, it is proposed to amend sub-section (2) of section 288 to enable any other person, as may be prescribed by the Board, to appear as an authorised representative.
These amendments will take effect from 1st April, 2020.
[Clauses 67 & 102]
Extract of Relevant Clauses of Finance Bill, 2020
Clauses 67
“Clause 67 of the Bill seeks to amend section 140 of the Income-tax Act relating to return by whom to be verified.
The said section, inter alia, provides for who shall verify the return file under section 115WD or section 139 of the said Act.
It is proposed to amend the clauses (c) and (cd) of the said section so as to empower the Board to specify by rules any other person for the said purpose in case of company and limited liability partnership.
These amendments will take effect from 1st April, 2020.”
Clauses 102
“Clause 102 of the Bill seeks to amend section 288 of the Income-tax Act relating to appearance by authorised representative.
Sub-section (2) of the said section, inter alia, provides for the definition of “authorised representative” who shall be entitled or required to attend before any income-tax authority or the Appellate Tribunal in connection with any proceeding under the said Act.
The proposed amendment of the said sub-section empowers the Board to provide by rules “any other person” who may also appear as an authorised representative.”
Extract of Relevant Amendment Proposed by Finance Bill, 2020
67. Amendment of section 140.
In section 140 of the Income-tax Act,–
(i) in clause (c), after the words “by any director thereof”, the words “or any other person, as may be prescribed for this purpose” shall be inserted;
(ii) in clause (cd), after the words “by any partner thereof”, the words “or any other person, as may be prescribed for this purpose” shall be inserted.
102. Amendment of section 288.
In section 288 of the Income-tax Act, in sub-section (2), after clause (vii), the following clause shall be inserted, namely:–
“(viii) any other person as may be prescribed.”.
