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.”

The CBDT has vide Order No. 52 of 2016 dated 21.03.2016 stated that the President has appointed several officers of Indian Revenue Service to the grade of Joint Commissioner of Income-tax purely on ad-hoc basis in PB-3 (Rs. 15,600-39,100 with GP Rs. 7,600) with effect from 1st April 2016 or assumption of charge of the post, whichever is later

The CBDT has issued a letter dated 16.03.2016 in which it has noted that an investigation has been conducted by Kolkata Investigation Directorate in respect of large number of penny stock companies, whose share prices were artificially raised on the Stock Exchanges in order to book bogus claims of Long Term Capital Gains or Short Term Capital Loss by various beneficiaries. It is stated that extensive investigation, including search and seizure/survey action on entry providers, riggers, beneficiaries etc. was conducted by the Investigation Directorate in such cases. Based upon outcome of such investigation and analysis of the data, the Systems Directorate has now uploaded details of such information in respect of individual assessees who have made transactions in such penny stocks. The CBDT has directed that the information relating to the “Penny Stock” should be considered by AO’s for making assessments u/s 143(3) and reopening assessments u/s 148 of the Act

The CBDT has issued Office Memorandum dated 11.03.2016 by which it has drawn attention to its earlier letter dated 01.06.2015 in which it was stated that in case of an assessee whose tax has been deducted at source but not deposited to the Government’s account by the deductor, the deductee assessee shall not be called upon to pay the demand to the extent tax has been deducted from his income. It was further specified that section 205 of the Income-tax Act, 1961 puts a bar on direct demand against the assessee in such cases and the demand on account of tax credit mismatch in such situations cannot be enforced coercively. The CBDT has noted that instances have come to the notice of the Board that these directions are not being strictly followed by the field officers. The CBDT has accordingly reiterated the instructions contained in its letter dated 01.06.2015 and directed the assessing officers not to enforce demands created on account of mismatch of credit due to non-payment of TDS amount to the credit of the Government by the deductor