CBDT introduces Aadhar based e-signatures for allotment of PAN & TAN online within a day of completion of valid online application

                                                   Government of India

                                                    Ministry of Finance                          

                                                   Department of Revenue 

                                              Central Board of Direct Taxes                         

                                                                                                 New Delhi, 22nd July, 2016.

 Sub :- Ease of Doing Business – Paperless PAN & TAN application process. 

For fast tracking the allotment of PAN and TAN to company applicants, Digital Signature Certificate(DSC) based application procedure has been introduced on the portals of PAN service providers M/s NSDL eGov and M/s UTIITSL. Under the new process PAN and TAN will be allotted within one day after completion of valid on-line application. 

Similarly, a new Aadhaar e-Signature based application process for Individual PAN applicants has been made available on the portals of PAN service providers M/s NSDL eGov. 

The URL links for the above applications are available in ‘important links’ on the homepage of the departmental website ‘incometaxindia.gov.in’.

 Introduction of Aadhaar based e-Signature through M/s NSDL eGov in PAN application not only ensures paperless hassle free PAN application process but also seeding of Aadhaar in PAN which will curb the problem of duplicate PAN to a great extent.

                                                                                              (Meenakshi J. Goswami) 

                                                                                           Commissioner of Income Tax                      

                                                                                           (Media and Technical Policy)

                                                                                           Official Spokesperson, CBDT.

90 lakh high-value deals without PAN under I-T scrutiny

 In a bid to crack down on those concealing their spending, the income tax department has identified 90 lakh high-value transactions where the permanent account number (PAN) was not quoted and has decided to send out seven lakh letters seeking details.
Those whose transactions have been identified will be asked to provide PAN in the first stage. Although the tax department did not spell out the future course of action, these transactions are then expected to be mapped against the returns filed by the entities and in case any gaps are spotted, notices demanding payment could also be issued in future. The transactions where PAN were not submitted included cash deposits of Rs 10 lakh or more in savings bank accounts or property transactions of Rs 30 lakh or more and have been sourced from Annual Information Returns filed with the department. The statement came as a sur prise given that the banks as well as property registration authorities have insisted on PAN for the last few years. The finance ministry said from the entire data, it has managed to group the transactions into seven lakh "high-risk"clusters, involving 14 lakh transactions, which were being scrutinized. The high-value transaction trails were detected following the department's drive to bring to book maximum amount of black money during the one-time compliance window closing on September 30. In fact, dealing with non-PAN related information is seen as a crucial element of expanding the tax base. The 90 lakh transactions are spread over the period starting 2009-10 and extend up to the current financial year. The government, however, said that those who get the letters need not rush to the tax office. They can provide the response through an e-filing portal, where they can log in by quoting a Unique Transaction Sequence Number provided in the letter.
This will help them easily link their transaction with their PAN easily, the finance ministry said. In the action plan for the current financial year, the government had said that it wanted to complete verification and match PAN by the end of July. Processing and verification of the cases is to be completed by the end of December with the Central Board of Direct Taxes monitoring the cases on a monthly basis.

(Times of India)

Govt extends payment date under black money scheme

 The finance ministry on Thursday extended the deadline for payment of tax and penalty under the scheme to disclose previously unreported money, allowing this to be done in three installments by September 30 next year. The ministry also clarified that black money declarants using the window cannot pay tax from undisclosed income. Earlier, the declarant had to pay tax, cess and penalty by November 30. Now, the first installment of 25 per cent under the Income Declaration Scheme- 2016, will have to be paid by November, to be followed by another 25 per cent by March 31, 2017. The remaining amount will have to be paid to the exchequer by September 30, 2017. The extension of time for payment was based on feedback, that it was too short a time to pay tax, cess and penalty The income tax department also came out with a fourth set of clarifications on the scheme. There were earlier reports that payment could be made out of the undisclosed income, without including this in the income declared, which would bring down the effective rate of tax, surcharge and penalty payable to around 31 per cent, from 45 per cent. The clarification in the form of frequently asked questions ( FAQs) stated there was no intent to “modify or alter the rate of tax, surcharge and penalty payable under the Scheme which have been clearly specified in the Scheme itself”. Further: “Sections 184 & 185 of the Finance Act, 2016, unambiguously provide for payment of tax, surcharge and penalty at the rate of 45 per cent of undisclosed income.” It offered an illustration: A person declares Rs.100 lakh as the undisclosed income... as on June 1, 2016, but pays tax, surcharge and penalty of Rs.45 lakh (Rs.30 lakh+Rs. 7.5 lakh+Rs.7.5 lakh) on the same out of his other undisclosed income. “In this case, the declarant will not get any immunity under the Scheme in respect of undisclosed income of Rs.45 lakh utilised for payment of tax, surcharge and penalty, but not included in the declaration filed under the Scheme,” it added. To get immunity in respect of the entire undisclosed income of Rs. 145 lakh in this case (Rs.100 lakh undisclosed income being declared and Rs.45 lakh the payment made from the undisclosed income not declared), one has to pay tax, surcharge and penalty amounting to Rs.65.25 lakh, that is 45 per cent of Rs.145 lakh. A four- month window starting from June 1 has been provided to persons holding undeclared income and assets to come clean by paying a tax of 30 per cent, and interest and penalty of another 7.5 per cent each, totalling 45 per cent. The window ends on September 30.

(Business Standard)

E-filing: ATM-based validation facility enhanced

The Income Tax department has widened the ATM-based validation system for filing e-ITRs by taxpayers with the inclusion of Axis Bank, after SBI, as part of its measure to enhance the paperless regime of filing the annual I-T returns. "Now, Electronic Verification Code (EVC) can also be generated by pre-validating Automated Teller Machine (ATM) provided by Axis Bank. SBI had activated the facility last month. Other banks are also expected to join soon," a senior I-T department official said. In May this year, the department had launched the bank account-based validation facility in this regard for those who have not availed the internet banking facility. The new facility is available on the official e-filing portal of the departmenthttp://incometaxindiaefiling.gov.in/ and will work by using the One Time Password (OTP) verification system as activated by the department last year by using the Aadhaar number. These measures are used to validate the e-ITR so that the taxpayer does not take the trouble of sending the paper-based ITR-V by post to the Bengaluru-based Central Processing Centre (CPC) for final resolution and processing. The new ITRs have been notified early this year and taxpayers can e-file thier ITRs till July 31. ITR-1 can be filed by individuals having income from salaries, one house property and from other sources including interest. ITR-2 is filed by Individuals and Hindu Undivided Families (HUFs) not having income from business or profession. ITR-2A is filed by those individuals and HUFs who do not have income from business or profession and capital gains and who do not hold foreign assets.

 (Economic Times)

Govt eyes Rs.15k -cr domestic black money by sept 30

 With almost two months left for people to declare undisclosed income, the revenue department in an internal assessment has pegged a collection of Rs.10,000-15,000 crore through black money declarations, according to sources.
The budget for 2016- 17 announced a four-month compliance window, allowing domestic black money holders to declare their unaccounted wealth, pay a tax and penalty total ling 45% and escape prosecution and harsher punishment. The window under the Income Declaration Scheme (IDS) 2016 opened on June 1 and will close on September 30. Tax and penalty at a total rate of 45% on the declared income is to be paid by November. Though response to the ongoing income declaration scheme is lukewarm as of now, the flood of queries about the disclosure has given the government confidence that the collection may be sizeable, sources said.
Finance minister Arun Jaitley has recently asked his officers to address all the taxpayer concerns to encourage disclosure of black money, sources said. If Rs.10,000-15,000 crore is collected, it would be one of the highest disclosure of black money. Last year, the government had given a similar opportunity to declare black money parked abroad. Around Rs.4,000 crore of undisclosed wealth was declared — way below expectations. But field officers have their doubts.
They said the maximum amount of domestic black money is parked in real estate, ranging from both low-value to high-value transactions, which are hard to trace. It is also tough to convince people to disclose the illicit part of their real estate transactions.
At present, it is a wait-and-watch situation as to whether the government is able to achieve its target or not, and how close are they towards Prime Minister Narendra Modi’s promise to transfer Rs.15 lakh into every Indian bank account, if the black money is unearthed. (Hindustan Times)Govt eyes Rs.15k -cr domestic black money by sept 30 With almost two months left for people to declare undisclosed income, the revenue department in an internal assessment has pegged a collection of Rs.10,000-15,000 crore through black money declarations, according to sources. The budget for 2016- 17 announced a four-month compliance window, allowing domestic black money holders to declare their unaccounted wealth, pay a tax and penalty total ling 45% and escape prosecution and harsher punishment. The window under the Income Declaration Scheme (IDS) 2016 opened on June 1 and will close on September 30. Tax and penalty at a total rate of 45% on the declared income is to be paid by November. Though response to the ongoing income declaration scheme is lukewarm as of now, the flood of queries about the disclosure has given the government confidence that the collection may be sizeable, sources said. Finance minister Arun Jaitley has recently asked his officers to address all the taxpayer concerns to encourage disclosure of black money, sources said. If Rs.10,000-15,000 crore is collected, it would be one of the highest disclosure of black money.
 Last year, the government had given a similar opportunity to declare black money parked abroad. Around Rs.4,000 crore of undisclosed wealth was declared — way below expectations. But field officers have their doubts. They said the maximum amount of domestic black money is parked in real estate, ranging from both low-value to high-value transactions, which are hard to trace. It is also tough to convince people to disclose the illicit part of their real estate transactions. At present, it is a wait-and-watch situation as to whether the government is able to achieve its target or not, and how close are they towards Prime Minister Narendra Modi’s promise to transfer Rs.15 lakh into every Indian bank account, if the black money is unearthed.

(Hindustan Times)

Tax Scrutiny made easy

CBDT vide letter dated 11-07-2016 has provided three revised format of issuing notices u/s 143(2).

1. Limited Scrutiny

2. Complete Scrutiny

3. Mannual Scrutiny

In Limited Scrutiny, issues identified for examination to be specified. Notice for Complete scrutiny shall specify that case is selected for complete scrutiny. In case of manual scrutiny, specific parameter for selection of case along with reference to manual instruction no. of compulsory scrutiny guidelines shall be given.

Assessee is required to produce evidence in support of his return or if assesse wishes to send no evidence, he may send his communication to AO.

If on the basis of response of assesse, any adverse view is contemplated, show cause notice/questionnaire shall be given .

In case of Ahemadabad, Bengluru, Chennai, Delhi , Hyderabad , Kolkatta and Mumbai, it is to be stated in notice that email based assessment is proposed to be made. Email id provided by assesse in return or alternate id provided by the assesse shall be used for the purpose. Assessees not wishing to opt for email based assessment may convey refusal to AO. Subsequent withdrawl from email based assessment is possible only with prior permission of AO.

Also in Instruction No. 20/2015 dated 29-12-2015, CBDT had mentioned that AO to provide reasons for scrutiny in cases which have been selected on the parameter(s) of AIR/CIB/26AS data . Further Specific issue based enquiry is to be conducted only in those scrutiny cases which have been selected on the parameter(s) of AIR/CIB/26AS data. In such cases, the Assessing Officer, shall also confine the Questionnaire only to the specific issues pertaining to AIR/CIB/26AS data

Procedure for TCS/ TDS return filing in the ITD e-filing potal

With effect from 1st May 2016, the online submission of Quarterly TDS/TCS statements will be discontinued at TIN-NSDL website.

The Deductor who desires to upload the Quarterly TDS/TCS e-Returns online, shall upload the same at e-Filing Portal of ITD. 

The Deductor must have registered the TAN at ITD’s e-Filing Portal using a valid Digital Signature Certificate. To know detailed procedure on how to register as ‘Tax Deductor and Collector’ please read this booklet.

Once the Tax Deductor and Collector login is created, user can upload the Quarterly TDS/TCS statements as described below:--

1.      Visit ITD’s e-filing home page (ITD e-filing) and login using TAN and Password

2.      After successful login, go to TDS menu >> Upload TDS

3.      In the form provided select the appropriate statement details, viz. FVU Version, Financial Year, Form Name, Quarter and Upload Type (Regular / Correction) and verify.

4.      Browse the TDS return filing zip file generated using Saral TDS

5.      Attach Signature file created using DSC Utility and click ‘Upload’

6.      On successful upload appropriate message will be displayed along with Transaction ID and the Token Number for future reference. Deductor can check the status of return after 24 hours of upload using the Token Number.

Clarifications on the Income Declaration Scheme, 2016

                                                            Circular No.25 of 2016
                                                               F.No.142/8/2016-TPL
                                                               Government of India
                                                                Ministry of Finance
                                                             Department of Revenue
                                                         Central Board of Direct Taxes
                                                                    (TPL Division)
                                                                                                                 Dated 30th of June, 2016
                                       Clarifications on the Income Declaration Scheme, 2016
The Income Declaration Scheme, 2016 (hereinafter referred to as ‘the Scheme’) incorporated as Chapter IX of the Finance Act, 2016 provides an opportunity to persons who have not paid full taxes in the past to come forward and declare the undisclosed income and pay tax, surcharge and penalty totaling in all 45% of such undisclosed income declared.The Income Declaration Scheme Rules, 2016 (hereinafter referred to as ‘the IDS Rules’) have been notified. In this regard, Circular No. 17 of 2016 dated 20th May, 2016 and Circular No. 24 of 2016 dated 27th June, 2016 issued by the Board provided clarifications to 14 and 11 queries respectively. Subsequently, further queries have been received from the public about various provisions of the Scheme.

The Board has considered the same and the following clarifications are issued.-

Question No.1: Will the information contained in the declaration be shared with other law enforcement agencies?
 Answer: No; the information contained in the declaration shall not be shared with any other law enforcement agency. The information will also not be shared within the Income Tax Department for any investigation in respect of a valid declaration.

Question No.2: Whether immunity will be provided under other economic laws including Service Tax, VAT, Companies Act, SEBI Act & regulations etc.?
Answer: The Scheme provides immunity under the Income-tax Act, 1961, the Wealth-tax Act, 1957 and the Benami Transactions (Prohibition) Act, 1988. Immunity from Benami Transactions (Prohibition) Act is subject to the condition that the property will be transferred to the declarant (being the person who provided the consideration for the property) latest by 30th September, 2017. However, as mentioned in response to Question No.1 above, the information contained in the declaration Page 2 of 5 made under the Scheme will not be shared with any other tax or law enforcement agency.

Question No.3: Where the value of immovable property determined under Rule 3 of the IDS Rules is lower than the value adopted or assessed/assessable by stamp valuation authority referred in section 50C or section 43CA of the Income-tax Act, whether value of such property is to be declared as per Rule 3 of the IDS Rules, or as per section 50C/43CA?
Answer: The value of the property for the purposes of declaration in such cases shall be computed as per Rule 3 of the IDS Rules even if such value is lower that the value adopted or assessed/assessable by stamp valuation authority.

Question No.4: Whether credit for tax deducted, if any, in respect of income declared shall be allowed?
Answer: Yes; credit for tax deducted shall be allowed only in those cases where the related income is declared under the Scheme and the credit for the tax has not already been claimed in the return of income file for any assessment year.

Question No.5: Where a valid declaration is made after making valuation as per the provisions of the Scheme read with IDS Rules and tax, surcharge & penalty as specified in the Scheme have been paid, whether the department will make any enquiry in respect of sources of income, payment of tax, surcharge and penalty?
 Answer: No.

Question No.6: What is the purpose of obtaining the information about the nature of undisclosed income in the last column of table at point (I) relating to nature of undisclosed income in Annexure to Form-1?
Answer: The purpose of obtaining information about the nature of undisclosed income is to know whether the undisclosed income is in the form of moveable asset, immovable asset, gold, jewellery or cash. Here, the nature of income need not be confused with the source of income. There is no need to indicate the source of income at all. In the column meant for nature of undisclosed income one has to write the nomenclature such as ‘immovable property’, ‘moveable property’, ‘gold’, ‘jewellery’ or ‘cash’ etc. This will enable the taxpayer to establish the link between the income declared under the scheme and Page 3 of 5 the claim, if any, made in respect of such undisclosed income in the return of income filed subsequently or during any assessment proceedings.

 Question No.7: In case the value of immovable property is evidenced by registered deed, whether the value as per registered deed or the market value as on 01.06.2016 is to be declared?
 Answer: As per Rule 3 of the IDS Rules, the fair market value of an immovable property shall be the higher of its cost of acquisition and the price that the property shall ordinarily fetch if it is sold in the open market as on 1st June, 2016. The value mentioned in the registered deed shall be relevant for determining the cost of acquisition and the same can be taken as the fair market value only where it is higher than the price that the property shall ordinarily fetch if sold in the open market as on 1st June, 2016.

 Question No.8: In case a declaration relating to investment in undisclosed asset is made under the Scheme, whether any investigation will be initiated against the seller in respect of such declaration? Answer: No.

Question No.9: What are the advantages of the Scheme as against declaring the past undisclosed income as current income in the return of income to be filed for Assessment Year 2017-18? How will the Department identify the year in which the undisclosed income was earned.
Answer: In this regard, the following points may be noted:  Declaration of past undisclosed income in the current year amounts to false verification of return of income which shall attract prosecution under the Income-tax Act.  If anyone attempts to disclose past undisclosed income in the current year, he will have to explain the source of income and substantiate the manner of earning the said income. In case of disclosure under the Scheme, there is no need to explain the source of income. Page 4 of 5  Declaration of past undisclosed income in the current year cannot explain assets acquired in the past or provide any immunity in respect of the same.  The Income-tax Department is in receipt of large volume of information from various sources such as registrars of property, banks, financial institutions, stock exchanges, tax deductors etc. The Department has launched a comprehensive data-mining and compliance management programme in the form of ‘Project Insight’ which will generate a large volume of reliable information about financial transactions undertaken by taxpayers and the relevant year in which the transaction was undertaken.

Question No.10: In a case the declarant earned undisclosed income of Rs. 90 lakh in previous year 2010-11. Out of the same, he acquired an immovable property in the previous year 2011-12 for Rs.50 lakh, made personal expenditure to the extent of Rs.20 lakh and balance Rs.20 lakh is left with him as cash in hand on 01.06.2016. The fair market value of the immovable property as on 01.06.2016 is Rs.80 lakh. What is the amount to be declared under the Scheme?
Answer: The declarant in this case has to declare the following: (i) Rs. 80 lakh being fair market value of the immovable property as on 01.06.2016 (ii) Rs. 20 lakh being the cash in hand as on 01.06.2016 (iii) Rs. 20 lakh being the balance of undisclosed income [Rs. 90 lakh – (Rs.50 lakh + Rs. 20 lakh)] which is not represented in the form of investment in any asset. Thus the total undisclosed income to be declared in this case will be Rs. 1.20 crore.


Question No.11: A person invested his undisclosed income in a house property in the previous year 2010-11 which has not been let out. The person also owned another house property from disclosed sources, which has been claimed as self-occupied property for the purposes of computation of income under the head income from house property. In case the person declares the undisclosed house property at its fair market value on 01.06.2016, whether any action will be taken for bringing the annual value of the undisclosed property to tax as income from house property by deeming it to be let property as Page 5 of 5 provided under section 23(4)(b) of the Income-tax Act for the earlier previous years?
Answer: No. However, where the house property was let-out during the relevant period, the actual rent received or receivable will be required to be declared under the Scheme in addition to the fair market value of the house property as on 01.06.2016.

(Dr. T.S. Mapwal) Under Secretary to the Government of India Copy to:-
1. PS to FM/ OSD to FM/ OSD to MoS(R).
2. PS to Secretary (Revenue).
3. The Chairperson, Members and all other officers in CBDT of the rank of Under Secretary and above.
 4. All Pr. Chief Commissioners/ Pr. Director General of Income-tax – with a request to circulate amongst all officers in their regions/ charges.
5. Pr. DGIT (Systems)/ Pr. DGIT (Vigilance)/ Pr. DGIT (Admn.)/ Pr. DG (NADT)/ Pr. DGIT (L&R). 6. CIT (M&TP), CBDT.
7. Web manager for posting on the departmental website.

(Source IT Deptt. Website)

I-T Dept Clears Air on Income Declaration Scheme

The Income Tax Department has issued another set of clarifications to remove lingering doubts about the ongoing Income Declaration Scheme, 2016, which allows people who have not paid full taxes in the past to come clean and reveal their undisclosed income and assets.
The scheme opened on June 1 for a four-month period ending September 30. The Central Board of Direct Taxes has issued clarifications in the form of 11 frequently-asked questions.
“The circular inter alia provides clarifications on issues such as confidentiality of information disclosed in the declaration, allowability of TDS (tax deducted at source) credit against declared income, enquiry in respect of source of income and payment of tax and initiation of enquiry against third parties on the basis of information furnished in the declaration, “the board said in a statement. The disclosures will be levied 30% tax and another 15% as surcharge and penalty, adding up to 45%. The total amount has to be paid by November 30.In case of part payment, the entire declaration will be treated as invalid. The scheme is available to both residents and non-residents. The permanent account number has to be quoted in the declaration. The department also said that declaring such income as current income for the assessment year 2017-18 would attract prosecution.
The department said through comprehensive data-mining, it has pinpointed information about transactions undertaken by taxpayers and the year in which they were done.

(Economic Times)