New Delhi: Here comes a piece of good news for taxpayers as the Central Board of Direct Taxation (CBDT) on Friday announced to extend the deadline till January 31 to avail a one-time facility to apply for compounding of income tax offences’. As per updates, 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.
Earlier, the CBDT had said that the 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.
“Cases have been brought to the notice of CBDT where the taxpayers could not apply for compounding of the offence as the compounding application was filed beyond 12 months,” it had said.
The CBDT said the deadline relaxation will not be available in regard to an offence which is generally or normally not compoundable.