Important CBDT Circular Sets Out Procedure For Speedy Resolution Of Taxpayer’s Grievances Regarding Outstanding Tax Demands

The CBDT has issued Circular No. 8 of 2015 dated 14.05.2015 setting out the detailed procedure that has to be followed by taxpayers in response to an arrear demand from the AO. The Ministry of Finance has also issued a press release stating that the said Circular is because the Income Tax Department has taken note of grievances of taxpayers arising on account of outstanding tax demand which may be inaccurate due to non-reporting or delayed reporting of TDS by deductors leading to mismatch between the claim and data available with the Department, non-posting of challans, non-disposal of rectification applications, incorrect details of income or pre-paid taxes reported by taxpayer etc. It is emphasized that the Income Tax Department is committed to early and satisfactory resolution of taxpayers’ grievances. It is also stated that about 95% of entries of Demand involve demand up to Rs. 1 lakh and about 90% of such assessees are Individuals and HUFs. It is expected that majority of the grievances of small taxpayers can be redressed by following the procedure prescribed in the circular.


Press Release issued by the Minstry of Finance:

CBDT issues a Circular for Early and Satisfactory Resolution of Taxpayers’ Grievances Relating to Verification and Correction of Tax Demand Outstanding against them

The Income Tax Department has taken note of grievances of taxpayers arising on account of outstanding tax demand which may be inaccurate due to non-reporting or delayed reporting of TDS by deductors leading to mismatch between the claim and data available with the Department, non-posting of challans, non-disposal of rectification applications, incorrect details of income or pre-paid taxes reported by taxpayer etc.

In order to swiftly and accurately resolve such grievances, the Central Board of Direct Taxes (CBDT), Department of Revenue, Ministry of Finance has issued a comprehensive Circular No. 8 of 2015 dated 14.05.2015 which is available on the websites of the Department https://www.incometaxindia.gov.in &www.incometaxindiaefiling.gov.in. The Circular explains the various steps to be taken by the taxpayers to view and submit their response with regard to their outstanding tax demand. The Circular elucidates the range of facilities available and the responsibilities of the Assessing officers to verify and take corrective actions. Demand up to Rs. 1,00,000/- for an Assessment year in case of an Individual or HUF which has already been paid but is shown as outstanding due to mis-match etc. can be rectified on the basis of evidence of tax paid as submitted by the taxpayer.

The taxpayers may view their outstanding tax demand on their e-filing account at www.incometaxindiaefiling.gov.in and follow the steps elucidated in the Circular to submit their response either agreeing with or disputing the demand.

The Income Tax Department is committed to early and satisfactory resolution of taxpayers’ grievances. About 95% of entries of Demand involve demand up to Rs. 1 lakh and about 90 % of such assessees are Individuals and HUFs. It is expected that majority of the grievances of small taxpayers can be redressed by following the procedure prescribed in the circular.



11 comments on “Important CBDT Circular Sets Out Procedure For Speedy Resolution Of Taxpayer’s Grievances Regarding Outstanding Tax Demands
  1. VEERAMANI says:

    It should be mandatory to maintain a rectification register. Assessees should be allowed to file rectification application online with the assessing officer and a serial number should be allotted to the assessee. This should be entered in the rectification register by the Assessing Officer and his register number should be intimated to the assesse. It should be made mandatory that the applications should be disposed within 45 or 30 days showing if any reasons for rejection if any. On the expiry of the stipulated date if not rejected the CPC should not make any adjustment and issue the refund.

  2. Murali says:

    We have several cases of applications u/s 154 seeking credit for TDS etc not being acted upon for several years despite followup. Who is monitoring disposal of 154 applications? Unless accountability is fixed, nothing much will move in the department.

  3. Mayur A Shah says:

    At present the CPC at Bangalore issues notices( actually a fatwa ) u/s 245 of the Act calling for objections to adjustment of demand against refunds. If the demand is raised by AO CPC has no authority to remit the demand even if paid. CPC gives only 15 days time to get the demand cancelled by the AO. Everyone knows the functioning of the income tax department so that even 15 years is not sufficient for the department to cancel the arrears from the CPC portal .

    So why do we not set deadlines for the AO. The best thing would be to withdraw the powers of CPC to adjust refunds and direct the AO to resolve the demand within 15 days failing which the refund would be issued by CPC without taking any recourse to him

    • Murali says:

      Sir, excellent suggestion. But doubt if dept will accept such a suggestion.
      We badly need administrative reforms in the dept. This should be the top priority of the Govt. Such reforms will give the right signal that the Govt is committed to “Ease of doing business in India”. There is no talk of implementation of Shome committee recommendations on Administrative reforms.

  4. sunil gupta says:

    CPC Bangolre should really follow up with the ao’s otherwise this will not be successful

  5. partha sarathy says:

    procedure for correcting error on the part of IT, seemingly surmounting. instead of this, the a.o. be fixed with onus, by the reasons of assessee for such variation with documentary evidences,just on an application u/s154, to verify and correct such error. for this even required a separate officer for each locality of IT may be appointed to assist a.o. as we got experience with officials, including for known reasons, while u make claim of TDS, say, not found in 26AS even after right findings.

  6. nilesh says:

    TDS defaulters should be penalised and not the deductees.

  7. Hitesh Parmar says:

    I can give more than 50 example of carelessness of Govt. Babus.

    What for they need notification from CBDT?

    They must have to sort out issue on priority instead of sitting on it.

    Hope BJP will draft vvarious plans for sorting out grievance of assessee, but it will work only after settling down of Namo in India.

  8. AJAYKUMAR MEHTA says:

    ONE MORE PLANNING WHICH WILL FAIL FOR SURE. VARIOUS EXPERIENCE HAVE BEEN FAILED IN PAST.

    CBDT SHOULD PLAN TO SET UP OFFICE, WHICH WILL TAKE UP CASES IN PERSON AND A PERSONAL MANUAL INPUT AND UPDATES ARE REQUIRED.

    • Hitesh Parmar says:

      AAAPP6260B Shailesh R Pardiwala AY 2008-09, ITR filed with Refund of 52000/- whereas 143 (1) Demands 66.36 Lacs includes 13.56 Lacs interest. &adjusted against Refund of Rs. 715000/- of AY-2011-12.

      Do you think ITO are smart enough to sort out issue of such genuine assessee ??
      Atleast 10 submission (with supporting documents) done for rectifying the error but no reply/action.

      This proove that, Corrupt people need bribe &genuine will not pay for it &suffer a loss &harrasement.

  9. Arvind Agrawal says:

    Excellent job

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