Tag: Circulars and Notifications(Income Tax)

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Unscrupulous elements conducting unauthorized/illegal searches: PRESS RELEASE, DATED 22-9-2017

The tax payers is well within his rights to seek & inspect the warrant of authorisation, confirm the identities of authorized Income Tax Authorities mentioned on the warrant. The assessee can seek the telephone numbers of immediate supervisory officers of the search/survey party for the purpose of verification of genuineness.

In case, any doubts still persists then the Income Tax Department can be contacted on the following number 9013850099 for the specified purpose of confirmation of identities of officers/officials working in the Delhi region.

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1.25 CRORES “new return filers” targeted to be added during 2017-18 as per CBDT letter dated 27-09-2017

 

A ‘new return filer’ for this purpose is defined as a person who has not filed return in the previous three Financial Years (2014-15 to 2016-17) but has filed return in the current financial year.

Region wise targets are as under:

:

Region Target for new return filers for FY 2017-18 Region Target for new return filers for FY 2017-18
JAIPUR 580261
AHMEDABAD 941123 KANPUR 616725
BANGALORE 876846 KOCHI 362156
BHOPAL 620925 KOLKATA 697685
BHUBHNESWAR 234850 LUCKNOW 620651
CHANDIGARH 1041948 MUMBAI 740741
CHENNAI 1047702 NAGPUR 211922
DELHI 727367 PATNA 502132
GUWAHATI 254948 PUNE 1182532
HYDERABAD 1239486 Total 12500000
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in cases where on receiving the intimation u/s 143(1l)(a)(vi) of the Act, the concerned assessee has already filed a revised return, such returns shall be treated as valid and handled accordingly

As per section 143(1)(a)  while processing return the total income or loss shall be computed after making the adjustments for

  • any arithmetical error in the return or [S.143(1)(a)(i)]
  • an incorrect claim, if such incorrect claim is apparent from any information in the return. [S.143(1)(a)(ii)] As per Explanation to 143(1) an incorrect claim apparent from any information in the return” shall mean a claim, on the basis of an entry, in the return
  1. of an item, which is inconsistent with another entry of the same or some other item in such return
  2. in respect of which the information required to be furnished under this Act to substantiate such entry has not been so furnished;
  3. in respect of a deduction, where such deduction exceeds specified statutory limit which may have been expressed as monetary amount or percentage or ratio or fraction

 

 

WEf AY 2017-18 Now adjustment u/s 143(1)(a) in return of income can also be made for

  1. disallowance of loss claimed, if return of the previous year for which set off of loss is claimed was furnished beyond the due date specified under sub-section (1) of section 139 [S.143(1)(a)(iii)]
  2. disallowance of expenditure indicated in the audit report but not taken into account in computing the total income in the return[S.143(1)(a)(iv)]
  3. disallowance of deduction claimed under sections 10AA, 80-IA, 80-IAB, 80-IB, 80-IC,80-ID or section 80-IE, if the return is furnished beyond the due date specified under sub-section (1) of section 139 [S.143(1)(a)(v)]
  4. addition of income appearing in Form 26AS or Form 16A or Form 16 which has not been included in computing the total income in the return [S.143(1)(a)(vi)]

 

Intimation of Adjustment to Assessee:

Provided that no such adjustments shall be made unless an intimation is given to the assessee of such adjustments either in writing or in electronic mode:

 

Response of the assessee to be awaited for 30 days

 

Provided further that the response received from the assessee, if any, shall be considered before making any adjustment, and in a case where no response is received within thirty days of the issue of such intimation, such adjustments shall be made

As per Above Instructions No. 9/2017, In returns filed in ITR-1 Form, information about a particular head/item of income is only on net basis and thus, complete data/information may not be available therein which may enable comparison with the data/information as contained in the three Forms [F.16,16A and 26AS]  in a meaningful manner. Therefore, in exercise of its powers under section 119 of the Act, the Board hereby directs that provision of section 143(1)(a)(vi) of the Act would not be invoked to issue intimation proposing adjustment to the income/loss so filed in ITR-1 Form in such situations.

 

  • However, where any head/item of income has been altogether omitted to be included in the return of income filed in ITR-1 while the three Forms contain specific detail in this regard pertaining to that item/head of income, section 143(1)(a)(vi) of the Act shall continue to apply.

 

  • Further, for purpose of section 143(1)(a)(vi) of the Act, only the three Forms specified therein would be taken into consideration

 

  • The pending intimations proposing adjustments under section 143(1)(a)(vi) wherein the taxpayer has tendered an explanation without revising the return or has not tendered any response till now shall be dealt with in accordance with the above direction.

 

In cases where on receiving the intimation u/s 143(1l)(a)(vi) of the Act, the concerned assessee has already filed a revised return, such returns shall be treated as valid and handled accordingly

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Cases of Agriculture Income more than 1 crore to be probed [CBDT letter 10-03-2016]

CBDT instructs officers to verify cases of agriculture Income more than one crore in resposne a PIL matter pending before Hon’ble Patna High Court wherein concerns have been raised that a few assesses may be engaged in routing their unaccounted/illegal money in the garb of agricultural income thereby not only claiming exemptions on such income but also engaged in the money laundering activities. Also CBDT has advised that there may be data entry errors also resulting in income being reflected more than one crores. List of cases where agiculture income is more than one crore has been made available to officers. In Amritsar 26 cases have been reported [CBDT Letter dated 10-03-2016]

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Monetary limits for filing appeals shall also apply to Cross Objections u/s 253(4), says CBDT

CBDT vide letter dated 08-03-2016 has clarified that the monetary limit of Rs. 10 lakhs imposed vide Circular No. 21/2015 dated 10-12-2015 for filing appeals before the ITAT would apply equally to cross objections under section 253(4) of the Act. Cross objections below this monetary limit, already filed, should be pursued for dismissal as withdrawn/not pressed. Filing of cross objections below the monetary limit may not be considered henceforth i.e. wef 08-03-2016

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CBDT has confirmed the decision of Supreme Court in TRF Ltd., which says that it is not necessary for assesseeto establish that debt has become irrecoverabie and it is enough if bad debt is written off as irrecoverable in the books of accounts of the assessee.

To mitigate litigation on baddebts, CBDT has asked officials not to file or pursue appeal s on the issue of failure of the assessee to establish that debt has become irrecoverable. CBDT has confirmed the decision of Supreme Court in TRF Ltd., which says that it is not necessary for assesseeto establish that debt has become irrecoverabie and it is enough if bad debt is written off as irrecoverable in the books of accounts of the assessee. [Circular No. 12/2016 dated 30-05-2016]

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Rule 31A further amended vide Notification 39/2016 dated 31-05-2016 to provide that for the purpose of TDS on Immovable property Statement cum Challan 26QB to be filed with in 30 days from the end of month in which TDS deducted.

Earlier Rule 31A was  amended vide N/N 30/2012 dated 29-04-2016  w.e.f. 01-06-2016 for TDS return for June to be filed by 31st May, for Sep by 31st October, for December by 31st January, for March by 31st May.

Further  Rule 30 was amended to extend the time period of TDS deposit on transaction of immovable property exceeding Rs 50 lacs from 7 days from the end of month to 30 days from end of month

Now Rule 31A further amended vide Notification 39/2016 dated 31-05-2016 to provide that for the purpose of TDS on Immovable property Statement cum Challan 26QB to be filed with in 30 days from the end of month in which TDS deducted.  Hence period extended from 7 days from the end of month to 30 days from the end of month.

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CBDT releases FAQ on TCS vide Circular No. 22/2016 dtd 08-06-2016

1.     TCS on Motor Vehicles exceeding 10 lacs is applicable to retail sale to customers only .

  1. TCS on motor vehicles exceeding 10 lacs is not applicable to transactions between manufacturer to dealer/distributors
  2. TCS @1% is not limited to luxury cars and includes all motor vehicles
  3. Sale to Government, UN Instituions, Foreign Embassies etc. are not exigible to TCS
  4. TCS on motor vehicle is applicable on single transactions exceeding ten lacs and aggregate of transactions not to be done for the purpose of threshold limit of 10 lacs.
  5. TCS to be collected on the booking/advance also @ 1%.
  6. If Motor Vehicle for Rs. 20 lacs is sold and booking advance is taken at Rs. 5 lacs and later Rs. 15 lacs is taken, then first collect 1% on 5 lacs and later 1% on 15 lacs.
  7. An Individual who is liable to Audit u/s 44AB in immediately preceeding financial year is liable for collection of TCS [As per S.206C Explanation ©, An individual or HUF covered by 44AB(a)/(b) is only liable for TCS , which means that if in the case of Individual or HUF turnover is lesser than one crore in case of business or Rs 25 lacs in case of profession, TCS is not applicable]
  8. TCS on motor vehicle is independent of the mode of payment i.e. TCS is applicable whether payment is made in cash or cheque.

If Motor vehicle is sold for more than 10 lacs, then TCS is applicable u/s 206C(1F), but if motor vehicle is sold for lesser than 10 lacs, and payment is received in cash then TCS shall be applicable u/s 206C(1D). Section 206C(1F) and S.206C(1D) can not apply simultaneously