CBDT Extends Deadline Till Jan 31 to Apply For Compounding of I-T Offences


The 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, an order issued on Friday said.

The earlier deadline was December 31, 2019.

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,” the CBDT said in the order.

As per the income tax terminology, 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.

The CBDT said that deadline is extended so that taxpayers can be given a final opportunity and reduce the pendency of existing prosecution cases before the courts.

As per the updates from the CBDT, taxpayers can file the application before the competent authority on or before January 31, 2020.

The CBDT circular added that application for compounding of an income tax offence can be filed in cases where:

Prosecution proceedings are pending before any court of law for more than 12 months or any compounding application for an offence filed previously was withdrawn by the applicant solely for the reason that such application was filed beyond 12 months or any compounding application for an offence had been rejected previously solely for technical reasons.

Though the relaxation shall not be applicable in respect of an offence which is generally or normally not compoundable such as serious tax evasion, financial crime, terror financing, money laundering, possession of illegal foreign assets, benami properties or conviction by a court in the past.

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