Business Standard

Govt to waive interest, fee, penalty, too, in petty tax cases

- INDIVJAL DHASMANA New Delhi, 19 February

Interest, penalty, fee, cess, and surcharge on taxpayers, besides the principal amount, will be withdrawn under the petty dispute relief scheme, which was announced in the Interim Budget for 2024-25. But the remission of these demands would not end criminal proceeding­s, either started or planned, against the tax assessee.

The Central Board of Direct Taxes (CBDT) has issued an order stating that the remission of petty demands will not include the demands of tax deducted at source and tax collected at source raised on deductors and collectors of income tax. This withdrawal does not entitle taxpayers to take credit or refund.

The scheme is set to be implemente­d by the Bengalurub­ased Directorat­e of Income Tax (Systems) at the Centralise­d Processing Centre (CPC), preferably within two months. It will be limited to ~1 lakh per assessee.

Sandeep Sehgal, tax partner at AKM Global, said that limiting the execution time to two months showcases the proactive move of the tax authoritie­s aimed at helping taxpayers. The interest rate for those who have delayed payment will not be factored into the calculatio­n of the ~1 lakh ceiling.

Union Finance Minister Nirmala Sitharaman had announced the withdrawal of past tax demands up to ~25,000 for 200910 and ~10,000 for 2010-11-2014-15 in the Interim Budget for 202425. The demand will be withdrawn from the earliest assessment year to the subsequent assessment years and will end when it aggregates to ~1 lakh.

In addition to the Income Tax Act, petty demands under the Wealth Tax Act and the Gift Tax Act will be withdrawn. Maneesh Bawa, a partner at Nangia Andersen India, advises taxpayers to access their online accounts to verify the status of extinguish­ed demands.

 ?? ?? The scheme was announced in the Interim Budget for 2024-25 and the remission of tax demands would not end criminal proceeding­s, either started or planned, against tax assessees
The scheme was announced in the Interim Budget for 2024-25 and the remission of tax demands would not end criminal proceeding­s, either started or planned, against tax assessees

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