The CBDT has issued Instruction No. 03/2013 dated 05.07.2013 with regard to the the directive issued by the Delhi High Court in Court on Its Own Motion vs. UOI 352 ITR 273 on the procedure to be followed on the receipt and disposal of rectification applications filed u/s 154 of the Act. The CBDT has set out a detailed procedure on where applications should be received, the maintenance of registers and their disposal. The CBDT has also issued Instruction No. 04/2013 dated 05.07.2013 with regard to the directive issued by the Delhi High Court in Court on Its Own Motion vs. UOI 352 ITR 273 that the demand should not be enforced in cases where no intimation u/s 143(1) was send by the field authorities in respect of returns which were processed prior to 31.03.2010.

In July 2012, the Prime Minister constituted a Committee to Review Taxation of Development Centers and the lT Sector under the Chairmanship of Mr. N Rangachary, former Chairman CBDT & IRDA. Several eminent tax professionals are a part of the Committee. The Committee has issued a first report dated 14.09.2012 in which it has dealt with several important issues such as (i) approach to taxation of Development Centres, (ii) whether the TNMM or the Profit Split Method or the Global Profit method should be adopted to determine the arms’ length income of these Centres, (iii) general transfer pricing issues which are not specific to the IT Sector (iv) income-tax issues pertaining to the IT Sector such as (a) whether “on-site” development is an export activity, (b) the impact of retrospective amendment of the definition of royalty with regard to taxation of software and transmission charges. The Committee has made far-reaching recommendations on each of the issues

The CBDT has issued a Press Release dated Nil stating that Circular No.2/2013 dated 26.03.2013 (Circular on application of profit split method) has been rescinded and that Circular No. 3 dated 26.03.2013 (Circular on conditions relevant to identify Development Centres engaged in contract R&D services with insignificant risk) has been amended and reissued with a view to clear all ambiguities in the matter

The CBDT has carried out a series of modifications to the earlier transfer and posting orders

Vide Order No. 1 dated 20.06.2013 the Chief Commissioner of Income-tax, Mumbai, has ordered the transfer and posting of 48 officers in the grade of Joint/ Additional Commissioners of Income-tax (Mumbai Region) with immediate effect

Vide Order No. 1 dated 18.06.2013 the Chief Commissioner of Income-tax, Mumbai, has ordered the transfer and posting of 148 officers in the grade of Assistant/ Deputy Commissioners of Income-tax (Mumbai Region) with immediate effect

The CBDT has issued Office Order No. 127/2013 dated 14.06.2013 stating that the President of India has appointed Ms. Sudha Sharma as Chairperson of the Central Board of Direct Taxes (CBDT) in the pay scale of Rs. 80,000 (fixed) with the status of Special Secretary to the Government. Upon taking charge, Ms. Sudha Sharma addressed a letter in which she pointed out that that the guiding principles of “non-intrusive” and “non-adversarial” tax administration as laid down by the Finance Minister has to be followed by the department in its day-to-day working. She also emphasized that the department has to create an environment for voluntary compliance. She pointed out that as tax collectors of the country, the tax department has a pivotal role to play in national growth and has to achieve the huge target of budget collection. She emphasized that the potential for tax collection is much higher given that there is a base of only about 3.5 crore assesses, a mere 2.9% of the national population, of which only 42,800 declares annual income over Rs. 1 crore. She stated that while the endeavour would be to promote voluntary compliance and provide hassle-free service to the honest tax payers, focus would need to be kept on non-filers and stop-filers in order in order to enhance the tax base and augment tax collection. She also stated that the department is aiming at achieving a tax regulation regimen in India which can match the best in the world

Vide Order No. 106 of 2013 dated 14.06.2013, the CBDT has ordered the transfer & posting of several officers in the grade of Commissioner of Income-tax with immediate effect