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Under section 268(11) of the Income-tax Act, 2025, who pays the expenses of a special audit directed under section 268(5), including the remuneration of the accountant?

Question and options

Under section 268(11) of the Income-tax Act, 2025, who pays the expenses of a special audit directed under section 268(5), including the remuneration of the accountant?

  1. The assessee, but only if the audit increases the assessed income

  2. The Central Government

  3. The assessee and the Central Government in equal shares

  4. The assessee whose accounts are audited

Answer and explanation

Correct answer: B - The Central Government

Section 268(11) of the Income-tax Act, 2025 provides that the expenses of a special audit or inventory valuation, including the remuneration of the accountant or cost accountant, are determined by the Principal Chief Commissioner, Chief Commissioner, Principal Commissioner or Commissioner under guidelines and paid by the Central Government. The assessee bears none of it, whatever the outcome of the audit.

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