Situations in which Income of Previous year is taxed in the P.Y
Situations in which Income of Previous year is taxed in the P.Y Generally, income of the previous year is taxed (i.e. assessable) in the immediately.

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Situations in which Income of Previous year is taxed in the P.Y Generally, income of the previous year is taxed (i.e., assessable) in the immediately following assessment year. However, in the following cases income of the previous year is taxed in the previous year itself. Now you can scroll down below and check more details for "Situations in which Income of Previous year is taxed in the P.Y"
If following conditions are satisfied, then income of a person leaving India is charged to tax in the previous year itself:
In above cases, the total income of such person for the period from the expiry of the previous year for that assessment year to the date when the Assessing Officer commences proceedings under section 175 shall be chargeable to tax in that assessment year.
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If following conditions are satisfied, then income of a non-resident is charged to tax in previous year itself
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It should be noted that in cases given in (1), (2), (4) and (5) it is mandatory to tax the income in the previous year itself. However, in case (3), i.e., income of discontinued business/profession income can be charged to tax in the previous year itself or in the assessment year (at the discretion of the Assessing Officer).
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Situations in which Income of Previous year is taxed in the P.Y
(1) Income of a person leaving India [Section 174]
- It appears to the Assessing Officer that any individual may leave India during the current assessment year or shortly after its expiry.
- Such a person has no present intention of returning to India.
- The assessment of the income of the previous year 2011-12.
- The assessment of the income of the previous year 2012-13.
- The assessment of the income of the period 1-4-2013 to 8-4-2013.
(2) Income of a person likely to transfer property to avoid tax [Section 175]
If following conditions are satisfied, then income of a person transferring his assets is charged to tax in the previous year itself:- It appears to the Assessing Officer during any current assessment year that any person is likely to charge, sell, transfer, dispose of or otherwise part with any of his assets.
- The intention of such sale, transfer, etc, is with a view to avoid payment of any liability under the provisions of the Act.
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(3) Income of discontinued business or profession [Section 176]
In addition to above instances, income of a discontinued business or profession can be charged to tax in the previous year itself. In other words, if a business or profession is discontinued during a year, then the income from the first day of the assessment year till the date of discontinuation can be charged to tax by the Assessing Officer in the assessment year in which the business is discontinued or in the immediately following assessment year.(4) Income from shipping business of non-residents (Section 172)
- The assessee is a non-resident.
- He owns a ship or a ship is chartered by him
- The ship carries passengers, livestock, mail or goods shipped at a port in India.
(5) Income of bodies formed for short duration [Section 174A]
If following conditions are satisfied, then income of bodies formed for short duration is charged to tax in the previous year itself:- It appears to the Assessing Officer that any association of persons or a body of individuals or an artificial juridical person is, formed or established or incorporated for a particular event or purpose.
- Above entity is likely to be dissolved in the assessment year in which such entity was formed or established or incorporated or immediately after such assessment year.