Tax Audit Checklist on Clauses 35 to 40 of Form 3CD Under the Income Tax Act, 1961

The Tax Audit Checklist for clauses 35 to 40 of Form 3CD under the Income Tax Act, 1961 provides a structured guide for tax auditors to ensure accurate and transparent reporting. These clauses focus on disclosing essential quantitative and financial details without requiring auditors to express any opinions. Clause 35 mandates reporting on goods traded and raw materials for assessees involved in trading, manufacturing, or both.

Clause 36, previously centered on Dividend Distribution Tax (DDT), has been omitted following its abolition in 2020, making it redundant from the assessment year 2021-22. Clauses 37 and 38 involve reporting on cost audits and excise audits for specific assessees, while Clause 40 requires the reporting of turnover and key financial ratios for the current and preceding years. The tax auditor’s role is primarily to report data and ensure compliance with the guidelines.

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