The Karnataka High Court has extended the due date for filing Tax Audit Reports (TAR) under Section 44AB of the Income Tax Act, 1961, by one month to 31st October, 2025. The writ petition was filed by Karnataka State Chartered Accountants Association (KSCAA) seeking an extension of due dates for tax audit and was listed for hearing today.
Earlier in the day, the Rajasthan High Court also granted a one-month extension. A division bench of Justice Pushpendra Singh Bhati and Justice Bipin Gupta of the Jodhpur Bench noted that the CBDT had allowed similar relaxations in past years. The interim order came in response to a writ petition filed by the Tax Bar Association, Jodhpur. Similar petitions are being heard across different High Courts in India.
For now, the Karnataka Rajasthan High Court’s orders are applicable only within Rajasthan and Karnataka, unless the CBDT issues a nationwide notification. “As the order is of Rajasthan and Karnataka High Courts, it will apply there only (that too if appeal or a Review Petition isn’t filed by CBDT in Supreme Court). We are awaiting pan-India CBDT notification,” an tax expert said.
Who needs a tax audit?
Under Section 44AB of the Income Tax Act, businesses with turnover above Rs 1 crore must undergo a tax audit. However, the limit is raised to Rs 10 crore if at least 95% of the transactions are digital, part of the government’s push toward a cashless economy.
Freelancers and professionals such as doctors, lawyers, architects, or chartered accountants running private practices also fall under audit requirements if annual income exceeds Rs 50 lakh. Taxpayers under presumptive taxation schemes like Section 44ADA are not entirely exempt either; if they declare profits below the prescribed rate, a tax audit becomes mandatory.
The deadline for filing the Tax Audit Report is September 30, 2025. Missing it can attract penalties of 0.5% of turnover or Rs 1.5 lakh, whichever is lower.
