The Narendra Modi Government has sent a bone-chilling warning to all income-tax officers that they will have to pay a steep price if they continue with their nefarious activities of harassing taxpayers with the illicit objective of extorting money from them

Taxmann has systematically analyzed the several amendments made to the Finance Bill 2016 at the stage of its being passed by the Lok Sabha. Several of the changes are of critical importance to taxpayers

The CBDT has issued a directive dated 2nd May 2016 in which it has been directed that the income arising from transfer of unlisted shares would be considered under the head ‘Capital Gain’, irrespective of period of holding, with a view to avoid disputes/litigation and to maintain uniform approach

The Central Board of Direct Taxes (CBDT) vide order dated 8th June 2015 constituted a Committee to inter alia suggest the framework for computation of book profit for the purposes of levy of Minimum Alternate Tax (MAT) under section 115JB of the Income-tax Act, 1961 (‘ the Act’) for Indian Accounting Standards (Ind AS) compliant companies in the year of adoption and thereafter. After a detailed discussion of the provisions of section 115JB of the Act, Ind AS and relevant sections of the Companies Act, 2013, the Committee has suggested a framework for computation of books profit of Ind AS compliant companies

The CBDT has issued Circular No. 11/2016 dated 26.04.2016 stating that in accordance with the judgement of the Supreme Court in UOI vs. Tata Chemical Limited 363 ITR 658 it is settled that if resident deductor is entitled for the refund of tax deposited under Section 195 of the Act, then it has to be refunded with interest under section 244A of the Act, from the date of payment of such tax. The CBDT has directed that no appeals may henceforth be filed on this ground by the officers of the department and appeals already filed on this issue may not be pressed

The CBDT has issued Circular No. 09/DV/2016 dated 26th April 2016 in which it has expressed the view, by relying on the judgement dated dated 8.7.15 of the Kerala High Court in Grihalaxmi Vision vs. ACIT that the limitation for imposition of penalty under sections 271D and 271E of the Income tax Act, 1961 does not commence at the level of the Assessing Officer (below the rank of Joint Commissioner of lncome Tax) but commences at the level of the Range authority i.e. the Joint Commissioner of Income Tax./Addl. Commissioner of Income Tax. The CBDT has advised Assessing Officers (below the rank of Joint Commissioner of Income) to make a reference to the Range Head regarding any violation of the provisions of section 269SS and section 269T of the Act, as the case may be, in the course of the assessment proceedings (or any other proceedings under the Act). It has directed that the Assessing Officer, (below the rank of Joint Commissioner of Income Tax) shall not issue the notice in this regard. The Range Head will issue the penalty notice and shall dispose/ complete the proceedings within the limitation prescribed u/s 275(1)(c) of the Act

The CBDT has issued a press release dated 18.04.2016 stating that the Income-tax Act, 1961 (the Act) provides that the Central Board of Direct Taxes may prescribe rules specifying the procedure for grant of relief or deduction of income-tax paid in any country or specified territory outside India, under section 90/ 90A/ 91 of the Act against the income-tax payable under the Act. Accordingly, the CBDT has framed the draft rules for grant of Foreign Tax Credit. The CBDT has invited comments from stakeholders and general public by 02.05.2016 at the email address dirtpl4@nic.in or by post at Director (TPL-IV), Central Board of Direct Taxes, Room No. 147-F, North Block, New Delhi

In a shocking incident, the CESTAT has passed severe strictures against the casual manner in which officials of the high rank of Commissioner (Appeals) have disposed off appeals. The order points out that the order sheets were maintained in a casual manner and even the order issued by the Commissioner (Appeals) was undated. “If this is the manner an appellate authority acts, and his undated order comes for judicial review, it is difficult to appreciate the very existence of the impugned order itself as to whether that has seen the light of the day” the CESTAT observed in a caustic tone. Stung by the strictures passed by the CESTAT, the CBEC has issued an Instruction dated 13.04.2016 in which it has lamented at the “severe lacunae in the functioning of quasi judicial and appellate authorities in the department” and stated that the “poor maintenance of records interalia in the discharge of the functions of these authorities has been a cause of concern”. It is also accepted with a tone of regret that “it is evident that the said Commissioner (Appeal) was performing his assigned public functions in a pre-functory and casual manner.”