Guidelines for remedial action in case of Revenue Audit objections.

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....eps are not taken by the Assessing Officers to initiate remedial actions. The proforma reports, sent on the draft paras proposed to be included - in the Annual Report of the C&AG, contain tentative remarks such as "being initiated", "instructions are being issued for taking remedial action" etc. Sometimes it is stated that no remedial action is being taken as the "objection is not accepted" which ....

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....ts stated to the audit are found to be incorrect. 3. If, however the issue raised by Audit pertains to interpretation of statute or involves conflicting High court decisions, the remedial action should be dropped only with the prior approval of the Board. For this purpose, a reference should be sent to the Board (A&PAC) section soon after the receipt of 'Statement of Facts' (SOF) stating cogent....

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.... as per the first Proviso to Section 143(1)(a) do need to be rectified in the interest of revenue. For instance in cases where Audit-points out-excess set-off of loss or carry forward of loss, records should be linked and remedial action should invariably be taken even though the objection is not accepted. There can be similar instances under sections 32, 32A, 43B or deductions under Chapter VI-A ....