More Clarifications on the Income Declaration Scheme, 2016

                                                                                                                   Circular No. 24 of 2016

F.No.142/8/2016-TPL

Government of India

Ministry of Finance

Department of Revenue Central Board of Direct Taxes

(TPL Division) ***

                                                                                                                    Dated 27th of June, 2016

Clarifications on the Income Declaration Scheme, 2016

The Income Declaration Scheme, 2016 (hereinafter referred to as ‘the Scheme’) incorporated as Chapter IX of the Finance Act, 2016 provides an opportunity to persons who have not paid full taxes in the past to come forward and declare the undisclosed income and pay tax, surcharge and penalty totaling in all 45% of such undisclosed income declared. The Income Declaration Scheme Rules, 2016 (hereinafter referred to as ‘the Rules’) have been notified. In this regard, Circular No. 17 of 2016 dated 20th May, 2016 issued by the Board provided clarifications to 14 queries. Subsequently, further queries have been received from the public about various provisions of the Scheme. The Board has considered the same and the following clarifications are issued.-

Question No.1: If only part payment of the tax, surcharge and penalty payable on undisclosed income declared under the Scheme is made before 30.11.2016, then whether the entire declaration fails as per section 187(3) of the Finance Act, 2016 or pro-rata declaration on which tax, surcharge and penalty has been paid remains valid?

Answer: In case of part payment, the entire declaration made under the Scheme shall be invalid. The declaration under the Scheme shall be valid only when the complete payment of tax, surcharge and penalty is made on or before 30.11.2016.

Question No.2: In case of amalgamation or in case of conversion of a company into LLP, if the amalgamated entity or LLP, as the case may be, wants to declare for the year prior to amalgamation/conversion, then whether a declaration is to be filed in the name of amalgamated entity/LLP or in the name of the amalgamating company or company existing prior to conversion into LLP? Answer: Since the amalgamating company or the company prior to conversion into LLP is no more into existence and the assets/liabilities of such  erstwhile entities have been taken over by the amalgamated company/LLP, the declaration is to be made in the name of the amalgamated company or the LLP, as the case may be, for the year in which the amalgamation/conversion takes place.

Question No.3: Whether the Scheme is open only to residents or to non-residents also?

Answer: The Scheme is available to every person, whether resident or nonresident.

Question No.4: If undisclosed income relating to an assessment year prior to A.Y. 2016-17, say A.Y. 2001-02 is detected after the closure of the Scheme, then what shall be the treatment of undisclosed income so detected?

Answer: As per the provisions of section 197(c) of the Finance Act, 2016, such income of A.Y. 2001-02 shall be assessed in the year in which the notice under section 148 or 153A or 153C, as the case may be, of the Income-tax Act is issued by the Assessing Officer. Further, if such undisclosed income is detected in the form of investment in any asset then value of such asset shall be as if the asset has been acquired or made in the year in which the notice under section 148/153A/153C is issued and the value shall be determined in accordance with rule 3 of the Rules.

Question No.5: Whether a person on whom a search has been conducted in April, 2016 but notice under section 153A is not served upto 31.05.2016, is eligible to declare undisclosed income under the Scheme?

Answer: No, in such a case time for issuance of notice under section 153A has not expired. Hence the person is not eligible to avail the Scheme in respect of assessment years for which notice under section 153A can be issued.

Question No.6: As per Circular No.17 of 2016, question No.14, it is not mandatory to attach the valuation report. But Form-1 states “attach valuation report”. How to interpret?

 Answer: It is necessary for the declarant to obtain the valuation report but it is not mandatory for him to attach the same with the declaration made in Form-1. However, the jurisdictional Pr. Commissioner/ Commissioner in order to ascertain the correctness of the value of the  asset quoted in Form-1 may require the declarant to file the valuation report before issuing the acknowledgment in Form-2. In such a circumstance, it will be necessary for the declarant to make the report available to the Pr. Commissioner/Commissioner.

Question No.7: Is it mandatory to furnish PAN in the Form of declaration?

Answer: Yes, PAN is the unique identifier for all direct tax purposes. This is also necessary in order to claim the benefits and immunities available under the Scheme.

Question No.8: If any proceeding is pending before the Settlement Commission, can a person be considered eligible for the Scheme?

 Answer: No, a person shall not be eligible for the Scheme in respect of assessment years for which proceeding is pending with Settlement Commission.

Question No.9: Land is acquired by the assessee in year 2001 from assessed income and is regularly disclosed in return of income. Subsequently in the year 2014, a building is constructed on the said land and the construction cost is not disclosed by the assessee. What shall be the fair market value of such building for the purposes of the Scheme?

Answer: Fair market value of land and building in such a case shall be computed in accordance with Rule 3(2) by allowing proportionate deduction in respect of asset acquired from assessed income.

Question No.10:Whether cases where summons under section 131(1A) have been issued by the Department or letter under the Non-filer Monitoring System (NMS) or under section 133(6) are issued are eligible for the Scheme?

Answer: Cases where summons under section 131(1A) have been issued by the department or letters for enquiry under NMS or under section 133(6) are issued but no notice under section 142 or 143(2) or 148 or 153A or 153C [as specified in section 196(e)] of the Finance Act, 2016 has been issued are eligible for the Scheme.

Question No.11: If notices under section 142, 143(2) or 148 have been issued after 31.05.2016 and assessee makes declaration under the Scheme then what shall be the fate of these notices?

Answer: As clarified vide Explanatory Circular No. 17 dated 20.5.2016 , a person shall not be eligible for the Scheme in respect of the assessment year for which a notice under section 142, 143(2) or 148 has been received by him on or before 31.5.2016. In a case where notice has been received after the said date, the assessee shall be eligible to make a declaration under the Scheme for the said assessment year. Such declaration shall be valid if it has not been made by suppression of facts or misrepresentation and the amount payable under the Scheme has been duly paid within the specified time. On furnishing by the declarant the certificate issued by the Pr. Commissioner/Commissioner in Form-4 to the Assessing Officer, the proceedings initiated vide notice under section 142, 143(2) or 148 shall be deemed to have been closed.

(Dr. T.S. Mapwal)

Under Secretary to the Government of India

Copy to:- 

1. PS to FM/ OSD to FM/ OSD to MoS(R).

2. PS to Secretary (Revenue).

3. The Chairperson, Members and all other officers in CBDT of the rank of Under Secretary and above.

 4. All Pr. Chief Commissioners/ Pr. Director General of Income-tax – with a request to circulate amongst all officers in their regions/ charges.

 5. Pr. DGIT (Systems)/ Pr. DGIT (Vigilance)/ Pr. DGIT (Admn.)/ Pr. DG (NADT)/ Pr. DGIT (L&R).

 6. CIT (M&TP), CBDT.

     7. Web manager for posting on the departmental website.

INCOME DECLARARION SCHEME, 2016 (FAQ) - PPT

INCOME DECLARATION SCHEME, 2016

RBI to accept pre-2005 notes only at select branches from July

The Reserve Bank today said it will accept pre-2005 banknotes only at its select branches from tomorrow as majority of the old series banknotes have been withdrawn.

RBI is pulling out the pre-2005 banknotes because of fewer security features compared to banknotes printed after 2005.

The central bank said it has observed that a major portion of the pre-2005 banknotes have been withdrawn from circulation and only a small percentage of these notes remains in circulation.

"On a review, therefore, the Reserve Bank has decided that from July 1, 2016 the facility of exchanging the pre-2005 banknotes will be available only at the select offices of the Reserve Bank," it said in a release.

The branches are: Ahmedabad, Bengaluru, Belapur, Bhopal, Bhubaneswar, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Jammu, Kanpur, Kolkata, Lucknow, Mumbai, Nagpur, New Delhi, Patna, Thiruvananthapuram and Kochi.

Reserve Bank in December 2015 had set June 30, 2016 as the last date for public to exchange pre-2005 banknotes at the identified bank branches and Issue Offices of the Reserve Bank.

RBI also clarified that these pre-2005 banknotes will continue to remain legal tender.

Further, RBI said it is a standard international practice that not to have currency notes from multiple series remaining in circulation at the same time.

Soliciting cooperation from public in withdrawing these banknotes from circulation, RBI has urged them to exchange pre-2005 banknotes at its mentioned offices as per their convenience.

"The Reserve Bank will continue to monitor and review the process so that the public is not inconvenienced in any manner," it said.

Read more at:
http://economictimes.indiatimes.com

INCOME DECLARATION SCHEME, 2016- PPT

Income declaration scheme

Cash payments to liquor dealers to maintain sufficient quantity of stock doesn't call forsec. 40A(3) disallowance

Where assessee, engaged in business of country liquor, had to make cash payments in excess of prescribed limits to two dealers in order to maintain sufficient stock of liquor as prescribed by Excise Department, exception provided in provisions of section 40A(3) with regard to business expediency was applicable to assessee's case and, thus, impugned disallowance made by Assessing Officer was to be deleted

Refer:[2016] 70 taxmann.com 319 (Kolkata - Trib.)

No rejection of books due to practice of not issuing sale bills of liquor as this practice prevalent in liquor trade

Where Assessing Officer rejected books of account of liquor business due to non-maintenance of sales records, since practice of not issuing bills was prevalent all over country in liquor trade, action of Assessing Officer was not justified

Refer:[2016] 70 taxmann.com 336 (Chandigarh - Trib.)

Applicability of Income Computation and Disclosure Standards (ICDS) deferred to Ass.Year 2017-18

Government of India 

Ministry of Finance 

Department of Revenue 

Central Board of Direct Taxes 

PRESS RELEASE 

New Delhi, 6th July, 2016 

Subject: Applicability of Income Computation and Disclosure Standards (ICDS) notified under section 145 (2) of the Income - tax Act, 1961. 

Vide Notification No. SO 892 (E) dated 31st March, 2015, Central Government notified 10 Income Computation and Disclosure Standards (ICDS). These ICDS are applicable from 1.4.2015 i.e. previous year 2015-16 (Assessment Year 2016-17). Subsequent to notification of the ICDS, a number of representations were received which were examined by an Expert Committee. The Committee has recommended amendments to the notified ICDS and also issuance of clarification in respect of certain points raised by the stakeholders.

2. The revision of ICDS/issue of clarifications as recommended by the Committee, is under consideration. The revision of the Tax Audit Report is also being made for ensuring the compliance with the provisions of ICDS and for capturing the disclosures mandated by the ICDS.

3. Some of the tax payers might have filed their return of income and obtained Tax Audit Report without incorporating the compliance with the ICDS and related disclosures in the absence of the revised Tax Audit Report. Considering these facts, it has been decided that the ICDS shall be applicable from 1.4.2016 i.e. previous year 2016-17 (Assessment Year 2017- 18). The notification to this effect will be issued shortly.

(Dr. B. K. Sinha) 

Commissioner of Income Tax 

(Media and Technical Policy) 

Official Spokesperson, CBDT.

I-T dept to scrutinise high value transactions, penny stock trade

Income Tax Department has asked its top officers to closely scrutinise high-value transactions and investments in penny stocks to identify potential black money holders who can avail the four-month compliance window ending September 30 to come clean.

In a communication to Principal Chief Commissioners in 18 regions across the country, the department has asked officers to look into Annual Information Returns (AIR), which do not contain valid PANs.

The database for 'Non-PAN AIR transactions' has already been disseminated to Principal Chief Commissioners based on the regions. 

It has also made available list of cases related to penny stock transactions for Assessment Year 2009-10 to 2013-14 for identifying potential black money holders.

The department has also asked the officials to share data on penny stock transactions with field formations.

Principal Chief Commissioners have also been asked to scrutinise "non-filers" and those who have not submitted their response to the tax authorities about non-filing of returns.

The department, the communication said, is also developing a new functionality on e-filing portal, which will force the tax payers to own up non-PAN transactions.

According to sources there are around 60 lakh high value AIR transactions without PANs which can be mined through online tracking systems.

The Budget for 2016-17 announced a four-month compliance window, allowing domestic black money holders to declare their unaccounted wealth, by paying a tax and penalty of 45 per cent and escape prosecution and harsher punishment.
The window under the Income Declaration Scheme (IDS) 2016 will remain open from June 1 to September 30. Tax and penalty on income declared, as per the original scheme, is to be paid by November.

Read more at:
http://economictimes.indiatimes.com

Catching them young: Income tax deptt will now talk to your kids

Don't be surprised if your kids turn around one day and ask you whether you have paid your income tax. In an effort to catch them young, the income tax department will be visiting your kids in school to tell them why taxes should be paid.

As per the Central Action Plan chalked out by the Income tax department for 2016-17, talks by income tax officials in schools as well as visits of students, in batches, to income tax offices have been planned. As per the Plan, young tax officers are to be deputed to visit schools and talk to the children in morning assemblies or otherwise. The officials would be using power point presentations and historical stories to show how the concept of taxation is a very old one and also how/why it is relevant even today.

The officers should emphasize how a rupee gained/collected by way of taxes is utilized towards development of the country leading to nation building, says the Plan. The officers have been asked to discuss the importance of taxation and menace of black money/parallel economy.

Indicating the seriousness with which this endeavour is being planned, the document even specifies the periodicity of such talks: 1 visit per quarter per Principal Commissioner of Income Tax charge.

That's not all. Visits of students, in batches of 20 to 25, to income tax offices are also to be organised. The student age group targeted for this purpose is 16-18 years. Again the periodicity of such visits has been fixed.

Further, if you thought that these visits would be limited to government schools think again. The Plan clearly says that the income tax department should target different kinds of schools for this awareness campaign including public schools and convents. Commissioners of Income Tax are to select schools falling within their territorial jurisdiction to avoid overlap.

The Plan leaves no stone unturned to ensure that the campaign succeeds. The department has been instructed that frequency of visits can be increased considering the local requirements so that sizeable number of schools in each city are covered in this initiative. The aim of the campaign is to ensure that schools are selected such that students from all strata of of society are covered.

This Central Action Plan was discussed at the Annual Conference of Senior Tax Administrators of Central Board of Direct Taxes (CBDT) in June this year in Delhi.

Over the last few years the tax department has become more pro-active in its communication efforts. Several special efforts are being made to increase awareness about the recently opened Voluntary Income Disclosure Scheme 2016.
Read more at:
http://economictimes.indiatimes.com

Govt. ready to consider a new Financial Year

CONSTITUTION OF A COMMITTEE TO EXAMINE DESIRABILITY AND FEASIBILITY OF HAVING A NEW FINANCIAL YEAR

PRESS RELEASE, DATED 6-7-2016

The Government of India today constituted a Committee to examine the desirability and feasibility of having 'a new financial year'. The Committee headed by Dr. Shankar Acharya (former Chief Economic Adviser) has Shri K.M. Chandrasekhar (former Cabinet Secretary), Shri P.V. Rajaraman (former Finance Secretary, Tamil Nadu) and Dr. Rajiv Kumar (Senior Fellow, Centre for Policy Research) as other Members. The Committee will examine the merits and demerits of various dates for the commencement of the financial year including the existing date (April to March), taking into account the various relevant factors.

The details on the Composition and the Terms of Reference of the Committee are uploaded on the website of Ministry of Finance (www.finmin.nic.in). The Committee has been given time till 31st December, 2016 to submit its Report.

Refer:www.taxmann.com

Direct Tax Collection upto June, 2016 shows an Increase of 24.79%

In a press release dated 8th July 2016 Central Board Of Direct Taxes stated that The figures for direct tax collection upto June, 2016 indicates net revenue collection of Rs.1.24 lakh crore which is a growth of 24.79% over the corresponding period last year. The main reason for this increase is the change in the requirements for advance tax payment even in respect of individuals which has been made in the last year’s Budget. Earlier there were only three instalments of advance tax to be paid by individuals in the months of September, December and March. From the current year, individuals are also supposed to pay four instalments of advance tax at the rate of 15%, 30%, 30% and 25% in the months of June, September, December and March of every Financial Year. The collection upto June, 2016 indicates that 14.63% of the annual budget target of direct taxes has been achieved in the first three months of the F.Y. 2016-17.

In terms of growth rate for corporation tax and personal income tax, the trend in gross revenue of corporation tax is indicating an increase of 13.5% while that of personal income tax (including STT etc.) a growth of 29.8%. However, after adjusting for refunds, the net growth in corporation tax is at 4.43% while that of personal income tax (including STT etc.) at 48.75%.

Income Declaration Scheme 2016 - Relaxation of time schedule for making payments under the Scheme

Government of India 

Ministry of Finance 

Department of Revenue 

Central Board of Direct Taxes 

New Delhi, 14th July, 2016

PRESS RELEASE 

Sub : The Income Declaration Scheme 2016 - Relaxation of time schedule for making payments under the Scheme 

During the course of meetings and seminars held in different parts of the country, various stakeholders have expressed concern that the time period available under the Scheme up to 30th November, 2016 for making payment of tax, surcharge and penalty is very short, especially where funds in liquid form are not readily available with the declarants. It has also been mentioned that for making payment by 30.11.2016, the declarants may have to opt for distress sale of the assets.
Taking into consideration the practical difficulties of the stakeholders, the Government has decided to revise the time schedule for making payments under the Scheme as under:
(i) a minimum amount of 25% of the tax, surcharge and penalty to be paid by 30.11.2016;
(ii) a further amount of 25% of the tax, surcharge and penalty to be paid by 31.3.2017; and
(iii) the balance amount to be paid on or before 30.9.2017.
 A Notification to this effect shall be issued shortly.

(Meenakshi J Goswami) 

 Commissioner of Income Tax 

 (Media and Technical Policy) 

 Official Spokesperson, CBDT. 

The Income Declaration Scheme 2016 - Issue of further FAQs

Government of India 

Ministry of Finance 

Department of Revenue 

Central Board of Direct Taxes

PRESS RELEASE 

New Delhi, 14 th July, 2016

Sub : The Income Declaration Scheme 2016 - Issue of further FAQs 

The Income Declaration Scheme, 2016 provides an opportunity to persons who have not paid full taxes in the past to come forward and declare their undisclosed income and assets. The Board has issued three sets of clarifications in the form of FAQs. The fourth set of Frequently Asked Questions (FAQs) providing clarification on various issues are in the process of being issued and will be available on the official website of the Income Tax Department i.e., www.incometaxindia.gov.in later today. 

Queries have been received from various stakeholders whether the payment under the Scheme can be made out of undisclosed income without including the same in the income declared, thereby bringing down the effective rate of tax, surcharge and penalty payable under the Scheme to around 31%. The fourth set of FAQs seek to set this issue at rest as follows: 

“Question No. 6: With reference to Question No.5 issued vide Circular No.25 of 2016, wherein it has been stated that the department will not make any enquiry in respect of sources of income, payment of tax, surcharge and penalty, it may be clarified that whether the payment under the Scheme can be made out of undisclosed income without including the same in the income declared, thereby bringing down the effective rate of tax, surcharge and penalty payable under the Scheme to round 31 per cent? 

Answer: It is clarified that the intent of the clarification issued vide Question No.5 of Circular No.25 of 2016 was limited to conduct of enquiry by the Department. It in no way intends to modify or alter the rate of tax, surcharge and penalty payable under the Scheme which have been clearly specified in the Scheme itself. Sections 184 & 185 of the Finance Act, 2016 unambigously provide for payment of tax, surcharge and penalty at the rate of 45 per cent of undisclosed income. This is illustrated by the following example— 

In a case a person declares Rs.100 lakh as undisclosed income, being the fair market value of undisclosed immovable property as on 1st June, 2016 and pays tax, surcharge and penalty or Rs.45 lakh (30 lakh + 7.5 lakh + 7.5 lakh) on the same out of his other undisclosed income. In this case the declarant will not get any immunity under the Scheme in respect of undisclosed income of 45 lakh utilized for payment of tax, surcharge and penalty but not included in the declaration filed under the Scheme. To get immunity under the Scheme in respect of the entire undisclosed income of Rs.145 lakh (Rs.100 lakh being undisclosed income represented by immovable property and Rs.45 lakh being the payment made from undisclosed income) and pay tax, surcharge and penalty under the Scheme amounting to Rs.65.25 lakh i.e., 45 per cent of Rs. 145 lakh.”

Other queries related to revision of declaration, chargeability of capital gain and TDS on transfer of property from benamidar to beneficial owner etc. have also been dealt with in the circular. 

(Meenakshi J Goswami) 

 Commissioner of Income Tax 

 (Media and Technical Policy) 

 Official Spokesperson, CBDT. 

Income Tax Department to issue 7 lakh letters seeking Information in respect of High Value Transactions

Government of India 

Ministry of Finance 

Department of Revenue 

Central Board of Direct Taxes 

New Delhi, 21st July, 2016

Press Release

Sub : Income Tax Department to issue 7 lakh letters seeking Information in respect of High Value Transactions 

Under the Annual Information Returns (AIR), various types of high-value transactions were being reported to the Income Tax Department. These include reporting of cash deposits of Rs.10,00,000 or more in a saving bank account, sale/purchase of immovable property valued at Rs. 30,00,000 or more, etc. Many of these transactions do not have PAN linked to it. The Department has details of about 90 lakh such transactions for the period 2009-10 to 2016-17. The Income Tax Department has with the help of in-house computer techniques, grouped such non-PAN transactions and identified 7 lakh high-risk clusters having around 14 lakh non-PAN transactions which are being scrutinized by the Income Tax Department closely.

The Department will be issuing letters to the parties of these transactions requesting them to provide their PAN number against these transactions. For the convenience of the parties to whom these letters are addressed, a new functionality on e-filing portal has been developed wherein they can own up transactions and provide structured response electronically. The parties can log-in to their e-filing website and by quoting a Unique Transaction Sequence Number provided in the letter sent to them, can link their transaction with their PAN easily. They will also be able to give a response to this letter electronically by choosing the option of either owning up the transaction or denying the transaction as their own. The responses received from such parties online will be examined by the Department. The Department will initiate further necessary action in those cases where no replies are received.
The members of public who receive such letters are requested to kindly cooperate in the matter. They may use the Departmental helpline to ask questions, as far as possible, instead of making direct contact with any officials of the Income Tax Department. Members of public are advised not to entertain any claims from unscrupulous elements who may offer their help in complying with such communication by falsely representing themselves to be the agents of Income Tax department in the matter.

(Meenakshi J Goswami) 

 Commissioner of Income Tax 

 (Media and Technical Policy) 

 Official Spokesperson, CBDT. 

Individuals attaining age of 60 yrs on 1st April to be deemed as senior citizens in preceding FY

SECTION 119 OF THE INCOME-TAX ACT, 1961 - INCOME-TAX AUTHORITIES - INSTRUCTIONS TO SUBORDINATE AUTHORITIES - CLARIFICATIONS REGARDING ATTAINING PRESCRIBED AGE OF 60/80 YEARS ON 31st MARCH ITSELF, IN CASE OF SENIOR/VERY SENIOR CITIZENS WHOSE DATE OF BIRTH FALLS ON 1st APRIL, FOR PURPOSES OF INCOME-TAX ACT

CIRCULAR NO.28/2016 [F.NO.225/182/2016/ITA.II], DATED 27-7-2016

Higher tax exemption limits have been prescribed under the past Finance Acts for resident senior citizen taxpayers who have attained the age of sixty years. Even in such cases, the exemption limit is still higher for very senior citizens who have attained the age of eighty years. A doubt has been raised about the attainment of the aforesaid qualifying ages for availing higher exemption in cases of the persons whose date of birth falls on 1st April of calendar year. In other words, the broader question under consideration is whether a person born on 1st April of a particular year can be said to have completed a particular age on 31st March, on the preceding day of his/her birthday, or on 1st April itself of that year.

2. The matter has been examined. Although specific provision does not exist in this regard under the Income-tax Act, 1961, the Hon'ble Supreme Court had an occasion to consider a similar issue in the case of Prabhu Dayal Sesma vs. State of Rajasthan & another 1986, AIR, 1948 wherein it has dealt with on the general rules to be followed for calculating the age of the person. In this judgment , Apex Court observed that while counting the age of the person, whole of the day should be reckoned and it starts from 12 O'clock in the midnight and he attains the specified age on the preceding, the anniversary of his birthday. The observation of Hon'ble Supreme Court in para 9 of the aforesaid judgment reads as under:

"9 ...........At first impression, it may seem that a person born on January 2, 1956 would attain 28 years of age only on January 2, 1984 and not on January 1, 1984. But this is not quite accurate. In calculating a person's age, the day of his birth must be counted as a whole day and he attains the specified age on the day preceding, the anniversary of his birthday. We have to apply well accepted rules for computation of time. One such rule is that fractions of a day will be omitted in computing a period of time is years or months in the sense that a fraction of a day will be treated as a full day. A legal day commences at 12 O'clock midnight and continues until the same hour the following night. There is a popular misconception that a person does (sic not) attain a particular age unless and until he has completed a given number of years. In the absence of any express provision, it is well settled that any specified age in law is to be computed as having been attained on the day preceding the anniversary of the birthday"

3. In view of the aforesaid judgment, the Central Board of Direct Taxes, in exercise of powers under section 119 of the Act, hereby clarifies that a person born on 1st April would be considered to have attained a particular age on 31st March, the day preceding the anniversary of his birthday. In particular, the question of attainment of age of eligibility for being considered a senior/very senior citizen would therefore be decided on the basis of above criteria.

4. The field authorities are directed to take note of above position for ascertaining the age while computing tax liability of a taxpayer falling in Individual' category, being resident in India.

DUE DATE FOR FILING INCOME TAX RETURNS EXTENDED TO AUGUST 5, 2016

The CBDT today released an order extending the due date to 5th August, 2016 for the of filing Income Tax Returns which are to be filed by 31st July, 2016. The said extension has been made in order to avoid inconvenience to the taxpayers considering the Bank Strike on 29th July, 2016 and the 31st of July (Sunday) being a bank holiday.

Click Here to view the original Notification

I-T Dept may write off small tax arrears of up to Rs 5,000

The idea is to cut litigation, lower the cost of collection and prioritising of bigger defaulters

For the first time ever, the income tax department is thinking of writing off tax arrears in each case where the dues are up to Rs 5,000.

The idea is to cut litigation, lower the cost of collection and prioritising of bigger defaulters. Though writing off will mean the government could lose up to to Rs 600 crore, many of these accounts are anyway not recoverable. There are four million tax arrear cases of under Rs 5,000, older than three years.

Initially, what is being considered is writing off 1.8 mn arrear cases with dues under Rs 100 each. "(This could) then be expanded to cover arrears under Rs 5,000. This will ease a lot of hassle that tax payers go through, beside de-cluttering our database of arrears, which might not even be recoverable," said an official. About 2.2 mn cases are between Rs 100 and Rs 5,000.

"Since these are old cases, they are not even being followed up by the department. In some cases, the defaulter cannot be tracked. The cost of recovery is higher than the pending tax amount in many cases," another official added.

Meanwhile, the government has decided to expedite refunds of up to Rs 5,000 and also for cases where the arrear amount is up to Rs 5,000. In a circular issued recently, the department has said: "The refund pendency data has revealed that there are a large number of pending claims of refunds up to Rs 5,000 ?for assessment years 2013-14, 2014-15 and 2015-16...the assessing officers be directed to issue refunds expeditiously, without making any adjustment of arrear demands..."

In 2014-15, the Central Board of Direct Taxes issued 13 mn refunds worth a combined Rs 26,663 crore.

Source:www.business-standard.com/

Senior officers to suggest circumstances justifying waiver of fee for delay in filing TDS returns: CBDT

SECTION 234E OF THE INCOME-TAX ACT, 1961 - DEDUCTION OF TAX AT SOURCE - DEFAULT IN FURNISHING STATEMENTS - FEE FOR - SITUATION OF GENUINE HARDSHIP JUSTIFYING WAIVER OF FEE CHARGED UNDER SECTION 234E

LETTER F.NO.275/27/2013-IT(B), DATED 2-8-2016

The Board is examining the desirability and expediency of prescribing situation/circumstances under which levy of fee under section 234E may cause genuine hardship to the taxpayers, so as to prescribe guidelines for waiver of such fees by virtue of the powers of the Board under section 119(2)(a) of the Income-tax Act, 1961.

2. In this connection, I am directed to request you to kindly forward your suggestions and recommendations for conditions/circumstances which justify waiver of fee under section 234E for an assessee or a class of assessees. These may kindly be furnished by 31-8-2016.

Rajya Sabha clears GST; releases Constitutional Amendment Bill, 2016

On Aug 3, 2016, Rajya Sabha discussed amendments to Constitution Bill for Goods and Service Tax i.e. Constitutional (One Hundred and First Amendment) Bill, 2016 and finally the most crucial bill passed in Rajya Sabha.GST will be introduced in the country after a long journey of 13 years as it was first discussed in the Kelkar Task Force report on indirect taxes in 2003.

This amendment bill was cleared since Government agreed to drop 1% additional tax and gave assurance that it will compensate States for any revenue loss incurred due to GST rollout. There will be a huge impact of GST on common man. Goods like Small Cars, Two wheeler, Movie Tickets, Electronic Items, etc., will be cheaper. But Air Travel, Insurance, Textile, Jewellery, Mobile Calls, Cigarettes will be costlier.

Click here to read CONSTITUTION (ONE HUNDRED AND FIRST AMENDMENT) BILL, 2016

Click here to read Relevant Amended PROVISIONS OF CONSTITUTION OF INDIA

Refer:taxmann.com

RBI launches 'Sachet' portal to check illegal money collection

The Reserve Bank of India (RBI) on Thursday launched a portal to curb illegal collection of money by companies.

The URL of the website is www.sachet.rbi.org.in

This website will enable public to obtain information regarding entities who accept deposits, lodge complaints and also share information regarding illegal acceptance of deposits, said RBI Governor Raghuram Rajan while launching 'Sachet' here.


"Initiating quick follow up and taking cases to logical conclusion by punishing the guilty is paramount to deterring entities in future from carrying out unlawful activity. I hope 'Sachet' would help regulators in doing this as much as it would help members of public in depositing their hard earned money with genuine companies by giving them timely information about them," Rajan said.

The website would also help enhance coordination among regulators and state government agencies.

Explaining the features of the website, Deputy Governor S.S. Mundra said, people can file and track a complaint on this website if any firm has illegally accepted money from them or defaulted in repayment of deposits.

People can also share information regarding any such entity on this portal, Mundra said.

The website also incorporates regulations prescribed by all financial regulators that one has to follow.

'Sachet' also has a section for closed user group for State Level Coordination Committee (SLCCs) wherein they could share market intelligence and other information about their activities as well as agenda and minutes of meetings across the country in real time.

All states have SLCCs comprising of various regulators, including RBI, Securities and Exchange Board of India (Sebi), National Housing Bank (NHB), Insurance Regulatory and Development Authority (IRDA), Registrar of Companies (ROC) and concerned state government departments, such as, home, finance, law and various police authorities.

Mundra hoped that the website will act as a 'force multiplier' and go a long way in making the SLCCs more effective in curbing the menace of unauthorised money raising activities.
Refer:www.business-standard.com