The Income Tax Department has requested area workplaces to not difficulty reassessment notices for 2012-13, 2013-14 and 2014-15 fiscal years to small taxpayers whereby the earnings escaping from tax is lower than Rs 50 lakh.
Issuing an instruction on implementation of the apex courtroom judgement concerning notices despatched past the three-year reassessment interval, the division stated that for FY16 and FY17 the place the timeline for difficulty of such notices falls inside the 3 years, tax officers will difficulty show-cause notices and supply info to taxpayers for initiating reassessment proceedings inside 30 days.
Central Board of Direct Taxes (CBDT) requested tax officers to offer taxpayers two weeks’ time to answer such notices, which will be additional prolonged at taxpayer’s request in real circumstances.
The Supreme Court had earlier this month dominated in favour of the I-T Department and upheld all reassessment notices issued on/after April 1, 2021– reopening assessments going again to as much as 6 years.
The authorities had in Budget final yr (2021-22) diminished the reopening time for I-T assessments to three years from 6 years.
However, the tax division despatched out a bunch of notices for reopening assessments which matches again to even past 3 years. These notices have been then challenged in a number of excessive courts and the I-T Department then appealed to the Supreme Court to uphold such notices.
Nangia & Co LLP Partner Shailesh Kumar stated so as to present readability each to tax officers and taxpayers and to make sure instructions of the Supreme Court are interpreted and applied uniformly in all of the 90,000 odd circumstances throughout India, CBDT has issued this a lot wanted instruction.
“This is a much welcome circular by CBDT providing clarity to both taxpayers and tax officials. Lot of cases for AYs 2013-14, 2014-15 and 2015-16 for small taxpayers are expected to be dropped… except in exceptional cases, where extended timeline for assets worth Rs 50 lakh of more is invoked,” Kumar stated.
AMRG & Associates Senior Partner Rajat Mohan stated this round would make clear all the problems emanating from the controversy created round reassessments by Finance Act 2021 and after results of the apex courtroom judgement.
“SC ruling read with the recent instruction would compel numerous to get the reassessments completed for notices issued from April to June 2021,” Mohan stated.
AKM Global Tax Partner Sandeep Sehgal stated CBDT has issued directions to the officers to provide materials to taxpayers for causes for reopening in order that they may reply accordingly inside 2 weeks.
“The timelines are aggressive for taxpayers. Further, where the escaped income is lower than Rs 50 lakh for certain years, no material will be provided by the tax officers as they would not proceed further with these cases. Suitable defences u/s 148A would also be available to the taxpayers wherever it is applicable,” Sehgal stated.
Dhruva Advisors Partner Sandeep Bhalla stated every case will should be additional evaluated as as to whether it’s a ‘fit case’ for reopening by the sector officers in contrast to reopening of assessments mechanically.
“It really becomes imperative for taxpayers grappling with the reassessment controversy to evaluate their tax positions and carefully strategize the defences available under the new law,” Bhalla stated.
Source: www.financialexpress.com”