HighlightsA. It is applicable to all taxpayer (corporate/non-corporate or resident/non-resident) irrespective of the turnover or income B. It will not have any impact on the minimum alternate tax (MAT) for corporate assessees as it will be based on the book profits to be determined as per the current applicable AS. It will only be applicable for computation of income chargeable under the head “Profits and gains of business or profession” or “Income from other sources” C. It is applicable only on the computation of the income and not for maintenance of the books. If there is any conflict, then the Income Tax Act will prevail over ICDS D. Income Tax Authorities have the power to assess the income on best judgment basis on non-compliance of ICDS E. All ICDS (except VII relating to Securities) contains transitional provisions which in general provide for recognition of outstanding contracts and transactions as on 1st April, 2015 in accordance with it after taking into account income/expenditure/loss already incurred in the past. There is no ‘grandfathering’ for outstanding contracts or transactions as on 31st March, 2015 F. It does not provide any explanations or illustrations like AS. It only lays down the principles to be adopted for computing Income G. Revenue or Expenses on which there is no ICDS will continue to be governed by existing AS
List of ICDS notified w.e.f 1st April, 2015
There are few ICDS for which the drafts were circulated but they have not been notified yet:1. Events occurring after the end of Previous Year 2. Prior Period Expense 3. Leases 4. Intangible Asset
The ICDS have been derived from the existing AS with specific deviations. However, there are no explanations and examples given in the ICDS, as given in AS.