Meaning of Assessee under the Income Tax Act

Who is the assessee under the income tax act?

Assessee means a person who has been assessed to income tax or who pays income tax under the income tax act 1961. In the income tax act, a person is referred to as an assessee. There are seven categories of assessees chargeable under the income tax act. Section 2(31) defines the person and the person includes: (Type of assessee)

1. An Individual
2. A Hindu Undivided Family (HUF)
3. A company (Private limited company or Limited company)
4. A partnership firm including Limited Liability Partnership (LLP)
5. An association of person, body of individual, whether incorporated or not
6. A local authority
7. Artificial Judicial person.

Under the income tax act, it is important to see the category of the person to check the applicability of provisions, exemptions, and rates of income tax. The word assessee includes deemed assessee and assessee in default. A partner of a partnership firm is also an assessee. The income tax act provides that if the defaulter is a Hindu undivided family (HUF), its Karta shall be deemed to be the defaulter. An individual can be a person but a person cannot be an Individual. Similarly, an individual may be an assessee but every assessee need not be an individual (CIT vs Om Prakash 238 ITR 1044 Supreme court). Under the income tax act an Individual means a natural person, i.e a Human being. Individual includes a minor or a person of unsound mind (Shridhar vs Commissioner of income tax 45 ITR 577).

Meaning of Assessee in Default.

The term ‘assessee’ in default is nowhere defined under the income tax act. However, in a simple term, it can be understood as an assessee who makes the default under the income tax act and fails to pay his obligations with respect to income tax, interest, fee and penalties.

What is the assessment year?

Assessment year means the period of twelve months commencing on the 1st day of April every year.

About the author: Nitin Bhatia is a qualified chartered accountant practising in Delhi, Gurgaon, Noida and Faridabad. He is the best CA in Gurgaon. During his professional journey, he has gained advanced experience in International Taxation, Transfer Pricing, Expatriate Taxation, Corporate Taxation, Domestic Taxation and litigation matters. International Taxation and Domestic taxation are his study topic, and he is deeply involved and updated with the recent judicial pronouncements. It helps him to give efficient and legitimate tax planning to his clients. 

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