CBDT Issues Revised Guidelines for Compounding of Offences under the
Income-Tax Act, 1961
<Revised
Guidelines for Compounding of offences dated 16.09.2022>
In conformity with the
Government's policy of facilitating Ease of Doing Business and decriminalisation
of offences, CBDT has taken steps in this direction and issued revised Guidelines
for Compounding of offences under the Income-tax Act, 1961(the 'Act') dated 16.09.2022
with reference to various offences covered under the prosecution provisions of the
Act.
Some of the major changes
made for the benefit of taxpayers include making offence punishable under Section
276 of the Act as compoundable. Further, the scope of eligibility for compounding
of cases has been relaxed whereby case of an applicant who has been convicted with
imprisonment for less than 2 years being previously non-compoundable, has now been
made compoundable. The discretion available with the competent authority has also
been suitably restricted.
The time limit for acceptance
of compounding applications has been relaxed from the earlier limit of 24 months
to 36 months now, from the date of filing of complaint. Procedural complexities
have also been reduced/simplified.
Specific upper limits
have been introduced for the compounding fee covering defaults across several provisions
of the Act. Additional compounding charges in the nature of penal interest @ 2%
per month up to 3 months and 3% per month beyond 3 months have been reduced to 1%
and 2% respectively.
The revised Guidelines
for Compounding of offences dated 16.09.2022 are available on http://www.incometaxindia.gov.in.