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Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
New Delhi, May 8th, 2020
PRESS RELEASE
Clarification in respect of residency under section 6 of the Income-tax Act, 1961
Section 6 of the Income-tax Act, 1961 (the Act) contains provisions relating to residency of a person. The status of an individual as to whether he is resident in India or a non-resident or not ordinarily resident, is dependent, inter-alia, on the period for which the person is in India during a year.
Various representations have been received stating that there are number of individuals who had come on a visit to India during the previous year 2019-20 for a particular durationand intended to leave India before the end of the previous year for maintaining their status as non-resident or not ordinary resident in India. However due to declaration of the lockdown and suspension of international flights owing to outbreak of Novel Corona Virus (COVID-19), they are required to prolong their stay in India. Concerns have been expressed that they may involuntarily end up becoming Indian residents without any intention to do so.
In order to avoid genuine hardship in such cases, the CBDT has decided vide circular no 11 dated May 8, 2020, that for the purposes of determining the residential status under section 6 of the Act during the previous year 2019-20 in respect of an individual who has come to India on a visit before 22nd March, 2020 and:
(a) has been unable to leave India on or before 31st March 2020, his period of stay in India from 22nd March, 2020 to 31st March, 2020 shall not be taken into account; or
(b) has been quarantined in India on account of Novel Corona Virus (Covid-19) on or after 1st March, 2020 and has departed on an evacuation flight on or before 31st March, 2020 or has been unable to leave India on or before 31st March, 2020, his period of stay from the beginning of his quarantine to his date of departure or 31st March, 2020, as the case may be, shall not be taken into account; or
(c) has departed on an evacuation flight on or before 31st March, 2020, his period of stay in India from 22nd March, 2020 to his date of departure shall not be taken into account.
Further, as the lockdown continues during the Financial Year 2020-21 and it is not yet clear as to when international flight operations would resume, a circular excluding the period of stay of these individuals up to the date of normalisation of international flight operations, for determination of the residential status for the previous year 2020-21 shall be issued after the said normalisation.
(Surabhi Ahluwalia)
Commissioner of Income Tax
(Media & Technical Policy)
Official Spokesperson, CBDT
Ministry of Finance
Dated: 26 APR 2020
The Central Board of Direct Taxes (CBDT) has said today that there is some report circulating on social media regarding suggestions by a few IRS officers on tackling COVID-19 situation.
It is unequivocally stated that CBDT never asked IRS Association or these officers to prepare such a report. No permission was sought by the officers before going public with their personal views and suggestions on official matters, which is a violation of extant Conduct Rules. Necessary inquiry is being initiated in this matter.
It is reiterated that the impugned report does not reflect the official views of CBDT/Ministry of Finance in any manner.
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RM/KMN
(Release ID: 1618493)
Press Information Bureau
Government of India
Ministry Of Law & Justice
Dated: 24 APR 2020
Income Tax Tribunal, ITAT, for the first time, holds hearing through video conferencing
A division bench of the Income Tax Appellate Tribunal (ITAT), led by the Tribunal’s President Justice P.P. Bhatt, has, through web based video conferencing platform, heard and disposed of an urgent stay petition today. This is a first in the 79-year-old history of this Tribunal. The petition was heard by a two member bench of the ITAT Mumbai, comprising Justice Bhatt and Vice President, ITAT, Shri Pramod Kumar, through VC from their home offices since closure of the ITAT due to the COVID-19 lockdown.
The appellate, Solapur based Pandhes Infracon Pvt Ltd. had sought an extremely urgent hearing of its stay petition on a notice of recovery of Rs.2.91 crores dues by Income Tax, Mumbai office for Assessment Year 2010-11. The Company had earlier moved the Bombay High Court, but were directed to approach the ITAT first.
Granting the stay, the ITAT bench suspended all notices issued by the revenue authorities on the bankers and debtors of the Company. The Departmental representative, who was present during the course of hearing, was directed by the bench to inform the stay order to the Assessing Officer/Field Officer. The bench meanwhile directed the Company’s related appeal for hearing on out of turn basis will be taken up on 8th June 2020.
The ITAT benches based in 27 locations are equipped to hold similar hearings through VC on petitions made by assesses or revenue department on urgent matters as and when exigencies arise.
Ministry of Finance
Dated: 21 APR 2020
The Central Board of Direct Taxes (CBDT) responding to some observations being circulated on social media alleging that the Income Tax Department is pursuing recovery proceedings and using arm-twisting methods by adjusting outstanding demands of the start-ups, today stated that these observations are completely unfounded and are total misrepresentation of facts.
The CBDT said that its email seeking clarification from all those who are entitled to get tax refund but also have outstanding tax to pay cannot be misconstrued as harassment. These computer generated emails have been sent to almost 1.72 lakh assessees which includes all classes of taxpayers – from individual to HUF to firms, big or small companies including start-ups and therefore to say that start-ups are being singled out and harassed is total misrepresentation of facts.
The CBDT said that these emails are part of the faceless communication which protects public money by ensuring that refunds are not released without adjusting against outstanding demand, if any. These emails are auto-generated u/s 245 of the I-T Act in refund cases where there is any outstanding demand payable by the assessee. In case the outstanding demand has already been paid by the taxpayer or it has been stayed by the higher tax authorities, the taxpayers are requested through these mails to provide the status update so that while issuing the refund, these amounts are not held back and their refunds are released forthwith.
The CBDT said that such communications are just a request for seeking an update response from the assessee for the proposed adjustment of refund with the outstanding demand and cannot be misconstrued as a notice of recovery or be perceived as so-called arm-twisting by the I-T department because the department is duty bound to protect public money by adjusting the outstanding demand before releasing the refund.
The CBDT further said that in order to provide hassle-free tax environment to the start-ups, a consolidated Circular no. 22/2019 dated 30th August 2019 was issued by the CBDT. Apart from laying down the modalities for assessment of start-ups, it also stipulated that the outstanding income tax demands relating to additions made under Section 56(2)(viib) would not be pursued. Any other income tax demand of such start-ups would also not be pursued unless the demand was confirmed by ITAT. Furthermore, a start-up cell was also constituted to redress grievances of start-ups and address other tax related issues of such concerns.
Explaining the extant procedure pertaining to recovery of outstanding demands in the case of an assessee, the CBDT said that an opportunity is provided by the department to the assessee to either clear the demand or intimate the status of said demand to the I-T Department. Invariably, such communication is made by the department by sending an email to the assessee informing it of the quantum of outstanding demand and providing an opportunity to pay the demand or respond with evidence regarding payment of the same if already made, or update the status of any other action on it.
The CBDT said that the assessee on its part is required to furnish details of the pending demand, whether it has been paid or has been stayed by any appellate/competent authority so that the department could keep the same in abeyance and do not deduct this amount from refund.
Thus, following the existing procedure of recuperation of outstanding demand, similar mails have also been sent to 1.72 lakh assessees including start-ups to intimate to the I-T department, the status of the demand outstanding and whether it has been stayed by the competent authority so that appropriate action can be taken for release of refunds without delay to the start-up. However, not providing such a response to the emails of I-T dept and raising false alarm is contrary to the spirit of the Circular 22/2019 of CBDT and is totally unjustified.
The CBDT further requested the start-ups to respond to its emails at the earliest so that further necessary action can be taken by the I-T Department to release the refunds immediately wherever due, in accordance with the extant procedure.
The CBDT reiterated that pursuant to the 8th April 2020 declaration vide an earlier Press Release of the Government, the CBDT has till date issued nearly 14 lakh refunds involving an amount of over Rs. 9,000 crore to various taxpayers including individuals, HUFs, proprietors, firms, corporate, start-ups, MSMEs in order to help taxpayers in the COVID-19 pandemic situation. Many refunds are pending for the want of response from the taxpayers and will be issued at the earliest possible once the information is updated.
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RM/KMN
(Release ID: 1616620)
Ministry of Finance
Dated: 19 APR 2020
In order to enable income taxpayers to avail full benefits of various timeline extensions granted by the Government of India due to Covid-19 pandemic situations, the CBDT is revising the return forms for FY 2019-20 (Assessment Year 2020-21) which shall be notified by the end of this month.
CBDT today said that in order to facilitate taxpayer to avail full benefits with various timeline extension up to 30th June 2020 granted by the government, it has initiated necessary changes in the return forms so that taxpayers could take benefits of their transactions carried out during the period from 1st April 2020 to 30th June 2020 in the return forms for FY 2019-20.
CBDT explained that the necessary modifications in the return forms are being made to allow taxpayers to avail the benefits of their investments/transactions made for the Apr-to-Jun 2020 period. Once the revised formsare notified, it will further necessitate the consequential changes in the software and return filing utility.Hence, the return filing utility after incorporating necessary changes shall be made available by 31st May, 2020 to avail benefits for FY 2019-20.
CBDT said thatdue to outbreak of Covid-19, the Government has extended various timelinesunder the Income-tax Act,1961 vide Taxation and Other Laws (Relaxation of certain provisions) Ordinance, 2020. Accordingly, the time for making investment/ payments for claiming deduction under Chapter-VIA-B of IT Act which includes Section 80C (LIC, PPF, NSC etc.), 80D (Mediclaim),80G (Donations), etc. for FY 2019-20 has also been extended to 30thJune 2020. Also, the dates for making investment/construction/purchase for claiming roll over benefit in respect of capital gains under sections 54 to section 54GB has also been extended to 30th June 2020. Therefore return forms are being revised to facilitate reporting of the transactions of the relief period.
It may be noted that generally the income-tax return forms are notified in the first week of April. This year also the e-filing utility for filing of return for Assessment Year 2020-21 wasmade available as on 1st April, 2020, and the Income-tax Return (ITR) Forms ITR-1 (Sahaj) and ITR-4 (Sugam) for the FY 2019-20 (Assessment Year 2020-21),too, were already notified vide notification dated 3rd January, 2020. However, to ensure that the taxpayer is enabled to avail all benefits of the timeline extension due to Covid -19 pandemic, the ReturnFormsrevision is being carried out.
RM/KMN
(Release ID: 1616035)