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Government of India
Department of Revenue
Ministry of Finance
Central Board of Direct Taxes
New Delhi, 29th October, 2020
PRESS RELEASE
Income-tax Exemption for payment of deemed LTC fare for non-Central Government employees
In view of the Covid-19 pandemic and resultant nationwide lockdown as well as disruption of transport and hospitality sector, as also the need for observing social distancing, a number of employees are not able to avail of Leave Travel Concession (LTC) in the current Block of 2018-21.
2. With a view to compensate Central Government employees and incentivise consumption, thereby giving a boost to consumption expenditure, the Government of India allowed payment of cash allowance equivalent to LTC fare to Central Government employees subject to fulfilment of certain conditions vide OM No F. No 12(2)/2020-EII (A) dated 12th October 2020. It has also been provided that since the cash allowance of LTC fare is in lieu of deemed actual travel, the same shall be eligible for income-tax exemption on the lines of existing income-tax exemption available for LTC fare.
3. In order to provide the benefits to other employees (i.e. non-Central Government employees) who are not covered by the above mentioned OM, it has been decided to provide similar income-tax exemption for the payment of cash equivalent of LTC fare to the non-Central Government employees also. Accordingly, the payment of cash allowance, subject to maximum of Rs 36,000 per person as Deemed LTC fare per person (Round Trip) to non-Central Government employees, shall be allowed income-tax exemption subject to fulfilment of conditions specified in para 4.
4. The income-tax exemption to receipt of deemed LTC fare by a non-Central Government employee (‘the employee’) shall be allowed subject to fulfilment of the following conditions:-
(a) The employee exercises an option for the deemed LTC fare in lieu of the applicable LTC in the Block year 2018-21.
(b) The employee spends a sum equals to three times of the value of the deemed LTC fare on purchase of goods / services which carry a GST rate of not less than 12% from GST registered vendors / service providers (‘the specified expenditure’) through digital mode during the period from the 12th of October, 2020 to 31st of March, 2021 (‘specified period’) and obtains a voucher indicating the GST number and the amount of GST paid.
(c) An employee who spends less than three times of the deemed LTC fare on specified expenditure during the specified period shall not be entitled to receive full amount of deemed LTC fare and the related income-tax exemption and the amount of both shall be reduced proportionately as explained in Example-A below.
5. The DDOs shall allow income-tax exemption subject to fulfilment of the above conditions after obtaining copies of invoices of specified expenditure incurred during the specified period. Further, as this exemption is in lieu of the exemption provided for LTC fare, an employee who has exercised an option to pay income tax under concessional tax regime under section 115BAC of the Income-tax Act, 1961 shall not be entitled for this exemption.
6. The clarifications issued by the Department of Expenditure, Ministry of Finance for the Central Government employees vide OM F. No 12(2)/2020-EII (A) Dated 20th October, 2020 and subsequent clarification, if any, issued in this regard shall apply mutatis mutandis to non-Central Government employees also subject to fulfilment of conditions specified in the preceding paras.
7. The legislative amendment to the provisions of the Income-tax Act, 1961 for this purpose shall be proposed in due course.
Example-A
Deemed LTC Fare : Rs.20,000 x 4 = Rs. 80,000
Amount to be spent : Rs. 80,000 x 3 = Rs. 2,40,000
Thus, if an employee spends Rs. 2,40,000 or above on specified expenditure, he shall be entitled for full deemed LTC fare and the related income-tax exemption. However, if the employee spends Rs. 1,80,000 only, then he shall be entitled for 75% (i.e. Rs. 60,000) of deemed LTC fare and the related income-tax exemption. In case the employee already received Rs. 80,000 from employer in advance, he has to refund Rs. 20,000 to the employer as he could spend only 75% of the required amount.
(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT
Government of India
Department of Revenue
Ministry of Finance
Central Board of Direct Taxes
New Delhi, 27th October, 2020
PRESS RELEASE
Income Tax Department conducts searches in Delhi- NCR, Haryana, Punjab, Uttarakhand and Goa
The Income tax Department has carried out a search and seizure action on 26.10.2020 on a large network of individuals running the racket of entry operation and generation of huge cash through fake billing. The search operations have been conducted on 42 premises across Delhi- NCR, Haryana, Punjab, Uttarakhand and Goa.
The search has led to seizure of evidences exposing the entire network of the entry operators, intermediaries, cash handlers, the beneficiaries and the firms and companies involved. So far, documents evidencing accommodation entries of more than Rs. 500 crorehave already been found and seized.
Several shell entities/firms were used by the searched entry operators for layering of unaccounted money and cash withdrawals against fake bills issued and unsecured loans given. The personal staff/employees/associates had been made dummy directors/partners of these shell entities and all bank accounts were managed and controlled by these entry operators. Statements of such entry operators, their dummy partners/employees, the cash handlers as well as the covered beneficiaries have also been recorded clearly validating the entire money trail.
The searched persons were also found to be controller and beneficial owners of several bank accounts and lockers, opened in names of their family members and trusted employees and shell entities, which they were managing in collusion with the bank officials, through the digital media. The same are being further investigated.
The beneficiaries have been found to have made huge investments in real estate properties in prime cities and in fixed deposits to the tune of several hundred crores of rupees.
During the search, cash of Rs. 2.37 crore and jewellery worth Rs. 2.89 crore has been found along with 17 bank lockers, which are yet to be operated.
Further investigations are in progress.
(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT
Government of India
Department of Revenue
Ministry of Finance
Central Board of Direct Taxes
New Delhi, 27th October, 2020
PRESS RELEASE
Payment Date Extended for Vivad se Vishwas Scheme:Finance Secretary urges I-T Department to Reach Out to the Taxpayers.
In order to provide further relief to the taxpayers desirous of settling disputes under Vivad se Vishwas Scheme, the Government today further extended the date for making payment without additional amount from 31st December 2020 to 31st March 2021. The last date for making declaration under the Scheme has also been notified as 31st December 2020. As per the notification issued today, the declaration under the Vivad se Vishwas Scheme shall be required to be furnished latest by 31st December 2020, however, only in respect of said declarations made by 31st December 2020 the payment without additional amount can now be made up to 31st March 2021.
Meanwhile, Finance Secretary Dr. Ajay Bhushan Pandey today reviewed the progress made so far by the Income Tax Department on Vivad se Vishwas Schemein a high level meeting through video conferencing along with CBDT Chairman and Board members with all Principal Chief Commissioners of Income Tax across the country to expedite the Scheme which, he said, is highly beneficial to the taxpayers, adding further that “We need to advance the Vivad se Vishwas Scheme with greater persuasion and perseverance and must reach out to the taxpayers to facilitate all necessary handholding.”
In the meeting, suggestions and comments of the Field Officers were also discussed regarding the action plan for successful implementation of the Scheme in a time bound manner.
Finance Secretary Dr. Pandey said, “This is a scheme for the benefit and convenience of the taxpayers as they would get instant disposal of the dispute with no further cost of litigation besides monetary benefits in the form of waiver of penalty, interest and prosecution. With this Scheme, on the one hand, a taxpayer would be benefitted with stress-free time to put her/his efforts for more meaningful daily life/routine or expanding business activities while on the other, the government would be getting its due long pending revenue and also, savings on the huge cost on resources that these disputes consume.”
In the meeting, the Chairman CBDT, Sri P C Mody mentioned the importance of cleaning up of demand for facilitating and persuading the taxpayers for filing declarations under the Scheme. He emphasized on Pr. Chief Commissioners of Income Tax to carry out all possible actions such as disposing pending rectifications, giving pending appeal effects, removing duplicate demands, etc. so as to arrive at a final demand for each assessee so that whenever a taxpayer files Form 1 or 2 under the Vivad se Vishwas Scheme, the Pr. Commissioner of Income Tax concerned is in a position to issue Form 3 promptly.
It was also decided in the meeting to adopt a proactive approach for implementation of the Scheme by approaching taxpayers directly, guiding and facilitating them in filing of declarations and removing any difficulties or problems faced by them in availing the Scheme. It was further decided to have periodic review of the progress of the Scheme every fortnight.
It is pertinent to mention here that the Direct Tax Vivad se Vishwas Act, 2020 was enacted on 17th March, 2020 with the objective to reduce pending income tax litigation, generate timely revenue for the Government and to benefit taxpayers by providing them peace of mind, certainty and savings on account of time and resources that would otherwise be spent on the long-drawn and vexatious litigation process. In order to provide more time to taxpayers to settle disputes, earlier the date for filing declaration and making payment without additional amount under Vivad se Vishwas was extended from 31st March 2020 to 30th June, 2020. Later again, this date was extended further to 31st December, 2020. Therefore, earlier both the declaration and the payment without additional amount under the Vivad se Vishwas were required to be made by 31st December, 2020.
(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT
Government of India
Department of Revenue
Ministry of Finance
Central Board of Direct Taxes
New Delhi, 24th October, 2020
PRESS RELEASE
Extension of due date of furnishing of Income Tax Returns and Audit Reports
In view of the challenges faced by taxpayers in meeting the statutory and regulatory compliances due to the outbreak of COVID-19, the Government brought the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020 (‘the Ordinance’) on 31st March, 2020 which, inter alia, extended various time limits. The Ordinance has since been replaced by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act.
2. The Government issued a Notification on 24th June, 2020 under the Ordinance which, inter alia, extended the due date for all Income Tax Returns for the FY 2019-20 (AY 2020-21) to 30th November, 2020. Hence, the returns of income which were required to be filed by 31st July, 2020 and 31st October, 2020 are required to be filed by 30th November, 2020. Consequently, the date for furnishing various audit reports including tax audit report under the Income-tax Act, 1961 (the Act) has also been extended to 31st October, 2020.
3. In order to provide more time to taxpayers for furnishing of Income Tax Returns, it has been decided to further extend the due date for furnishing of Income-Tax Returns as under:
(A) The due date for furnishing of Income Tax Returns for the taxpayers (including their partners) who are required to get their accounts audited [for whom the due date (i.e. before the extension by the said notification) as per the Act is 31st October, 2020] has been extended to 31st January, 2021.
(B) The due date for furnishing of Income Tax Returns for the taxpayers who are required to furnish report in respect of international/specified domestic transactions [for whom the due date (i.e. before the extension by the said notification) as per the Act is 30th November, 2020] has been extended to 31st January, 2021.
(C) The due date for furnishing of Income Tax Returns for the other taxpayers [for whom the due date (i.e. before the extension by the said notification) as per the Act was 31st July, 2020] has been extended to 31st December, 2020.
4. Consequently, the date for furnishing of various audit reports under the Act including tax audit report and report in respect of international/specified domestic transaction has also been extended to 31st December, 2020.
5. Further, in order to provide relief to small and middle class taxpayers, the said notification dated 24th June, 2020 had also extended the due date for payment of self-assessment tax for the taxpayers whose self-assessment tax liability is up to Rs. 1 lakh. Accordingly, the due date for payment of self-assessment tax for the taxpayers who are not required to get their accounts audited was extended from 31st July, 2020 to 30th November, 2020 and for the auditable cases, this due date was extended from 31st October, 2020 to 30th November, 2020.
6. In order to provide relief for the second time to small and middle class taxpayers in the matter of payment of self-assessment tax, the due date for payment of self-assessment tax date is hereby again being extended. Accordingly, the due date for payment of self-assessment tax for taxpayers whose self-assessment tax liability is up to Rs. 1 lakh has been extended to 31st January, 2021 for the taxpayers mentioned in para 3(A) and para 3(B) and to 31st December, 2020 for the taxpayers mentioned in para 3(C).
7. The necessary notification in this regard shall be issued in due course.
(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT
Government of India
Department of Revenue
Ministry of Finance
Central Board of Direct Taxes
New Delhi, 21st October, 2020
PRESS RELEASE
Income Tax Department carries out searches in Bihar
The Income Tax Department carried out searches on 19.10.2020 in the cases of two Government contractors having premises in Purnea, Katihar and Saharasa and a silk trader in Bhagalpur in Bihar. The searches were based on intelligence gathered, which indicated that large scale unaccounted cash was being generated and used for various purposes.
The contractors were making bogus claims of labour, transportation and fuel expenses, which were found to be not supported by any document. Further, they have been found to be withdrawing money in cash from the bank accounts of fictitious parties. Incriminating documents including signed blank cheques have been seized during the searches. In some cases, the liabilities were shown to be continuing in the books of accounts for bogus expenses. They were also maintaining undisclosed bank accounts, in which unaccounted cash was being deposited which was used for making fixed deposits, which in turn were pledged to Government departments as security for getting contracts. Large cash withdrawals have also been noticed in these bank accounts. The assessees could not explain the purpose of these cash withdrawals. The transactions in the undisclosed bank accounts are being examined.
During the search, unaccounted cash, fixed deposits and bullion of more than Rs. 2.40 crore have been seized / restrained. In the case of the silk trader, unaccounted stock has also been detected. Evidences indicating suppression of income of about Rs. 10 crore, alongwith documents showing large unaccounted investments in immovable properties have been found and seized. These properties are in the process of being valued and attached.
Further investigations are in progress.
(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT