Accordingly an order issued on friday said CBDT has extended till january 31 the last date for taxpayers to avail a "one-time" facility to apply for compounding of income tax offences, and the earlier deadline was december 31, 2019. Meanwhile in I-T parlance, compounding means that the taxman does not file a prosecution case against the offender or tax evader in court in lieu of payment of due taxes and surcharges. Furthermore the decision to extend the last date was taken "in view of references received from field formations, including requests made by ICAI (Institute of Chartered Accountants of India) chapters wherein it has been brought to the notice of the CBDT that the taxpayers could not avail the benefit of the one-time relaxation window due to genuine hardships". 

 

Apparently applications, as per the procedure of the scheme, are to be filed before the appropriate competent authority that is either a principal chief commissioner or a chief commissioner or a principal director general or director general of the Income-Tax Department "on or before" january 31, 2020. Perhaps the CBDT, while launching the scheme in september last year, had said that this "one-time measure" is being undertaken to mitigate unintended hardship to taxpayers in deserving cases and to reduce the pendency of existing prosecution cases before the courts.

 

Moreover the CBDT, which frames policy for the tax department, had earlier said that compounding of offences is "not a matter of right" and the department can extend such a relief only in certain cases. Hence this will be done keeping in view factors like "conduct of the person, the nature and magnitude of the offence on the context of the facts and circumstances of each case". 

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