What is the general period for the right to assess deficiency tax?

• A. Within 3 years after the last day of the filing of the ITR or the actual filing date, whichever is later.
• B. Within 5 years after the due date.
• C. Within 7 years after filing.
• D. Within 10 years only if false or fraudulent returns.

Answer: (A)

The period to assess deficiency tax is governed by the statute of limitations for assessment. The general rule is three years, counted from the later of the due date for filing the return or the actual filing date. That means if you file on time, the clock starts at the due date; if you file late, the clock starts on the filing date. There are important exceptions: if the return is false or fraudulent, or if no return is filed, the period can extend to ten years. So, under normal circumstances the three-year window applies, while the ten-year rule only kicks in for fraud or non-filing cases.