ICAI Introduces New Checklist for Section 44AB(e) During UDIN Generation

In a recent update, the Institute of Chartered Accountants of India (ICAI) has introduced a new checklist while generating UDIN for Tax Audit reports under Section 44AB(e). The move is aimed to strictly identify whether Section 44AB(e) is actually applicable and to stop misuse of tax audit limits under other clauses.

The new feature was recently added in the UDIN portal and users are now seeing additional questions before generating UDIN. The checklist asks auditors to confirm points like

“Is section 44AD(4) applicable?”

and

“Is Total Income more than Basic Exemption Limit?”

These questions are mandatory before proceeding further.

According to professionals, this change is mainly introduced to control the incorrect use of Section 44AB(e). In many cases, tax audits were reportedly being conducted under different clauses to avoid crossing the limit of 60 tax audits allowed for a Chartered Accountant. ICAI now wants proper classification and reporting of such audits.

Section 44AB(e) is related to taxpayers who were previously under presumptive taxation scheme under Section 44AD but later declared lower income than prescribed conditions. In such situations, tax audit becomes applicable if total income exceeds the basic exemption limit.

The new checklist will help in better compliance and transparency. It may also reduce chances of wrong reporting during UDIN generation process.

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