Short overview of the Change in the Guidelines of the Compounding of Offences under the Income Tax Act-1961

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Short overview of the Change in the Guidelines of the Compounding of Offences under the Income Tax Act-1961

 

The prosecution proceeding is on the rise. Even small cases are there where the prosecution proceeding is launched. The Government is acting tough against not only the tax evaders but also against the non-tax compliances. Small cases of delay in filing of TDS are also subject to the prosecution proceeding.

 

The compounding of offence is the way out in such cases. The earlier guidelines of the compounding of offences has been revisited now and various changes have been carried out in the revised Guidelines on 16th September, 2022.

 

Let us have a short overview of the some of the changes done in the guidelines for Compounding of Offences under the Income-tax Act which is in supersession of earlier Guidelines

 

  1. The charges for Compounding where relaxation is allowed has been increased by 20% from 1.25 to 1.5 times of the normal compounding charges,
  2. The offence under Section 276 (Removal, concealment, transfer or delivery of property to thwart tax recovery) can now be compounded.

 

  1. Relaxation time for filing compounding applications increased from 12 to 24 months and up to 36 months instead of 24 months from the end of the month in which a complaint is filed.

 

  1. Period for payment of compounding charges can be extended by PCCIT/CCIT/ PDGIT/DGIT upto 6 months instead of 3 months and Regional PCCIT can extend it upto 12 months

 

  1. Interest on delayed payment of compounding charges decreased to 1% p.m. from 2% p.m. for upto 3 months and to 2% p.m. from 3% p.m. beyond 3 month.

 

The copy of the revised guidelines is as under:

 

 

 

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