Re: Procedural questions- Reduction in loss , MAT- – Clarification is desired from CBDT
In cases of reduction in loss where taxpayer settles the dispute by payment of notional tax with a right to carry forward full loss as claimed. However, assessment records may continue to reflect the reduced losses as per the assessment order.
Also, what is the mechanism to upgrade the assessment records with eligible amount of loss so as to avoid possible mis-match in subsequent year where loss is to be setoff? Similar issue may also arise in case of reduction in MAT / AMT credit as well.
We understand that CBDT will issue administrative instruction to field officers to pass rectification order to rectify the assessment records based on the settlement under VSV. However, no such instructions are in place yet. Further, to get over difficulty of limitation period under section 154, it is likely to be clarified that such rectification order will be passed under VSV and not under Income-tax Act.
Leave a Reply