# Assessee and Assessment

## Assessee [Sec 2(7)]

An Assessee means a person by whom any tax or any other sum of money is payable under the Income-tax Act, 1961.

The term also includes:

1. Every person in respect of whom any proceeding under the Act has been initiated for the assessment of:

his income; OR
the income of any other person for which he is assessable; OR
the loss sustained by him or by such other person; OR
the amount of refund due to him or to such other person.

2. Every person who is deemed to be an assessee under any provision of the Act.

3. Every person who is deemed to be an assessee in default under any provision of the Act (e.g., a deductor who fails to deduct/deposit TDS).

## Assessment

The procedure by which the income of an assessee is determined and tax liability is computed.

## Key Concept

> Every Assessee is a Person, but every Person is not an Assessee.

A person becomes an assessee only when there is a tax/sum payable, a proceeding initiated, or a deeming provision invoked.

Worked example

### Example 1

Example 1: Mr. X earned ₹2,00,000 (below basic exemption). He files no return and has no tax. He is a Person but NOT an Assessee.

### Example 2

Example 2: Mr. Y is a guardian of minor M whose income is clubbed in Mr. Y's hands. Mr. Y is assessable for M's income → Mr. Y is an Assessee.

### Example 3

Example 3: Company Z failed to deduct TDS on payments → Z is deemed to be an 'Assessee in Default'.

⚠️ Common exam mistakes

Equating 'Person' with 'Assessee' — every assessee is a person, but not the reverse.
Ignoring 'assessee in default' (e.g., TDS defaulters) — they are assessees.
Forgetting that a person claiming refund is also an Assessee.
Not including persons assessable for OTHERS' income (e.g., legal heir, guardian).

Bare-Act text Section 2(7) · Income-tax Act, 1961 · click to expand

Sec 2(7) 'Assessee' means a person by whom any tax or any other sum of money is payable under this Act, and includes — (a) every person in respect of whom any proceeding under this Act has been taken for the assessment of his income or assessment of fringe benefits or of the income of any other person in respect of which he is assessable, or of the loss sustained by him or by such other person, or of the amount of refund due to him or to such other person; (b) every person who is deemed to be an assessee under any provision of this Act; (c) every person who is deemed to be an assessee in default under any provision of this Act.

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