Income Tax Archives - CENTRAL GOVERNMENT EMPLOYEES NEWS

Taxability of various components of salary – Income from Different Sources AY 2023-2024 (FY 2022-2023)

admin — Mon, 27 Jun 2022 14:22:45 +0000

Income from Different Sources AY 2023-24 (FY 2022-23) under Income Tax as amended by Finance Act, 2022

Any income which is not chargeable to tax under any other heads of income and which is not to be excluded from the total income shall be chargeable to tax as residuary income under the head “Income from Other Sources”.

Treatment of Income from Different Sources

I. Income under the head Salaries

1.1 Salary is defined to include:

a) Wages
b) Annuity
c) Pension
d) Gratuity
e) Fees, Commission, Perquisites, Profits in lieu of or in addition to Salary or Wages
f) Advance of Salary
g) Leave Encashment
h) Annual accretion to the balance of Recognized Provident Fund
i) Transferred balance in Recognized Provident Fund
j) Contribution by Central Government or any other employer to Employees Pension Account as referred in 80CCD

1.2 Points to consider:

a) Salary income is chargeable to tax on “due basis” or “receipt basis” whichever is earlier.
b) Existence of relationship of employer and employee is must between the payer and payee to tax the income under this head.
c) Income from salary taxable during the year shall consists of following:
- Salary due from employer (including former employer) to taxpayer during the previous year, whether paid or not;
- Salary paid by employer (including former employer) to taxpayer during the previous year before it became due;

iii. Arrear of salary paid by the employer (including former employer) to taxpayer during the previous year, if not charged to tax in any earlier year;

Exceptions – Remuneration, bonus or commission received by a partner from the firm is not taxable under the head Salaries rather it would be taxable under the head business or profession.

1.3 Place of accrual of salary:

a) Salary accrues where the services are rendered even if it is paid outside India;
b) Salary paid by the Foreign Government to his employee serving in India is taxable under the head Salaries;
c) Leave salary paid abroad in respect of leave earned in India shall be deemed to accrue or arise in India.

Exceptions – If a Citizen of India render services outside India, and receives salary from Government of India, it would be taxable as salary deemed to have accrued in India.

1.4 Taxability of various components of salary:

S.No.	Section	Particulars	Taxability/Exemption
1.	17	Basic salary	Fully taxable
2.	17	Dearness Allowance (referred to as ‘DA’)	Fully taxable
3.	17	Bonus, fees or commission	Fully taxable

A. Allowances

4.	10(13A) read with Rule 2A	House rent allowance	Least of the following is exempt: a) Actual HRA Received b) 40% of Salary (50%, if house situated in Mumbai, Calcutta, Delhi or Chennai) c) Rent paid minus 10% of salary * Salary = Basic + DA (if part of retirement benefit) + Turnover based Commission Note: i. Fully taxable, if HRA is received by an employee who is living in his own house or if he does not pay any rentii. It is mandatory for employee to report PAN of the landlord to the employer if rent paid is more than Rs. 1,00,000 [Circular No. 08 /2013 dated 10-10-2013].
5.	10(14)	Children education allowance	Up to Rs. 100 per month per child up to a maximum of 2 children is exempt
6.	10(14)	Hostel expenditure allowance	Up to Rs. 300 per month per child up to a maximum of 2 children is exempt
7.	10(14)	Transport Allowance granted to an employee to meet expenditure for the purpose of commuting between place of residence and place of duty	Rs. 3,200 per month granted to an employee, who is blind or deaf and dumb or orthopedically handicapped with disability of lower extremities
8.	Sec. 10(14)	Allowance granted to an employee working in any transport business to meet his personal expenditure during his duty performed in the course of running of such transport from one place to another place provided employee is not in receipt of daily allowance.	Amount of exemption shall be lower of following: a) 70% of such allowance; orb) Rs. 10,000 per month.
9.	10(14)	Conveyance allowance granted to meet the expenditure on conveyance in performance of duties of an office	Exempt to the extent of expenditure incurred for official purposes
10.	10(14)	Travelling allowance to meet the cost of travel on tour or on transfer	Exempt to the extent of expenditure incurred for official purposes
11.	10(14)	Daily allowance to meet the ordinary daily charges incurred by an employee on account of absence from his normal place of duty	Exempt to the extent of expenditure incurred for official purposes
12.	10(14)	Helper/Assistant allowance	Exempt to the extent of expenditure incurred for official purposes
13.	10(14)	Research allowance granted for encouraging the academic research and other professional pursuits	Exempt to the extent of expenditure incurred for official purposes
14.	10(14)	Uniform allowance	Exempt to the extent of expenditure incurred for official purposes
15.	10(7)	Any allowance or perquisite paid or allowed by Government to its employees (an Indian citizen) posted outside India	Fully Exempt
16.	–	Allowances to Judges of High Court/Supreme Court (Subject to certain conditions)	Fully Exempt.
17.	10(45)	Following allowances and perquisites given to serving Chairman/Member of UPSC is exempt from tax: a) Value of rent free official residence b) Value of conveyance facilities including transport allowance c) Sumptuary allowanced) Leave travel concession	Fully Exempt
18.	–	Allowances paid by the UNO to its employees	Fully Exempt
19.	Sec. 10(14) read with Rule 2BB	Special compensatory Allowance (Hilly Areas) (Subject to certain conditions and locations)	Amount exempt from tax varies from Rs. 300 to Rs. 7,000 per month.
20.	Sec. 10(14) read with Rule 2BB	Border area, Remote Locality or Disturbed Area or Difficult Area Allowance (Subject to certain conditions and locations)	Amount exempt from tax varies from Rs. 200 to Rs. 1,300 per month.
21.	Sec. 10(14) read with Rule 2BB	Tribal area allowance in (a) Madhya Pradesh (b) Tamil Nadu (c) Uttar Pradesh (d) Karnataka (e) Tripura (f) Assam (g) West Bengal (h) Bihar (i) Orissa	Up to Rs. 200 per month is exempt
22.	Sec. 10(14) read with Rule 2BB	Compensatory Field Area Allowance. If this exemption is taken, employee cannot claim any exemption in respect of border area allowance (Subject to certain conditions and locations)	Up to Rs. 2,600 per month is exempt
23.	Sec. 10(14) read with Rule 2BB	Compensatory Modified Area Allowance. If this exemption is taken, employee cannot claim any exemption in respect of border area allowance (Subject to certain conditions and locations)	Up to Rs. 1,000 per month is exempt
24.	Sec. 10(14) read with Rule 2BB	Counter Insurgency Allowance granted to members of Armed Forces operating in areas away from their permanent locations. If this exemption is taken, employee cannot claim any exemption in respect of border area allowance (Subject to certain conditions and locations)	Up to Rs. 3,900 per month is exempt
25.	Sec. 10(14) read with Rule 2BB	Underground Allowance to employees working in uncongenial, unnatural climate in underground mines	Up to Rs. 800 per month is exempt
26.	Sec. 10(14) read with Rule 2BB	High Altitude Allowance granted to armed forces operating in high altitude areas (Subject to certain conditions and locations)	a) Up to Rs. 1,060 per month (for altitude of 9,000 to 15,000 feet) is exemptb) Up to Rs. 1,600 per month (for altitude above 15,000 feet) is exempt
27.	Sec. 10(14) read with Rule 2BB	Highly active field area allowance granted to members of armed forces (Subject to certain conditions and locations)	Up to Rs. 4,200 per month is exempt
28.	Sec. 10(14) read with Rule 2BB	Island Duty Allowance granted to members of armed forces in Andaman and Nicobar and Lakshadweep group of Island (Subject to certain conditions and locations)	Up to Rs. 3,250 per month is exempt
29.	10(14)	City Compensatory Allowance	Fully Taxable
30.	10(14)	Fixed Medical Allowance	Fully Taxable
31.	10(14)	Tiffin, Lunch, Dinner or Refreshment Allowance	Fully Taxable
32.	10(14)	Servant Allowance	Fully Taxable
33.	10(14)	Project Allowance	Fully Taxable
34.	10(14)	Overtime Allowance	Fully Taxable
35.	10(14)	Telephone Allowance	Fully Taxable
36.	10(14)	Holiday Allowance	Fully Taxable
37.	10(14)	Any Other Cash Allowance	Fully Taxable
38.	10(5)	Leave Travel Concession or Assistance (LTC/LTA), extended by an employer to an employee for going anywhere in India along with his family **Family includes spouse, children and dependent brother/ sister/parents. However, family doesn’t include more than 2 children of an Individual born on or after 01-10-1998. (Subject to certain conditions)	The exemption shall be limited to fare for going anywhere in India along with family twice in a block of four years: • Where journey is performed by Air – Exemption up to Air fare of economy class in the National Carrier by the shortest route • Where journey is performed by Rail – Exemption up to air-conditioned first class rail fare by the shortest route • If places of origin of journey and destination are connected by rail but the journey is performed by any other mode of transport – Exemption up to air-conditioned first class rail fare by the shortest route. • Where the places of origin of journey and destination are not connected by rail: * Where a recognized public transport system exists – Exemption up to first Class or deluxe class fare by the shortest route * Where no recognized public transport system exists – Exemption up to air conditioned first class rail fare by shortest route. Notes: i. Two journeys in a block of 4 calendar years is exempt ii. Taxable only in case of Specified Employees [See note 4]

B. Perquisites

39.	17(2)(i)/(ii) read withRule 3(1)	Rent free unfurnished accommodation provided to Central and State Government employees	License fees determined in accordance with rules framed by Government for allotment of houses shall be deemed to be the taxable value of perquisites.
40.	17(2)(i)/(ii)read withRule 3(1)	Unfurnished rent free accommodation provided to other employees	Taxable value of perquisites i. If house property is owned by the employer, the taxable value of perquisite shall be: A. 15% of salary, if population of city where accommodation is provided exceeds 25 lakhs B. 10% of salary, if population of city where accommodation is provided exceeds 10 lakhs but does not exceed 25 lakhs C. 7.5% of salary, if accommodation is provided in any other city ii. If house property is taken on lease or rent by the employer, the taxable value of perquisite shall be: i. Lease rent paid or payable by the employer or 15% of the salary, whichever is lower Salary includes: a) Basic Pay b) Dearness Allowance (only to the extent it forms part of retirement benefit salary) c) Bonus d) Commission e) All other allowances (only taxable portion) f) Any monetary payment which is chargeable to tax But does not include i. Value of any prerequisite ii. Employer’s contribution to PF iii. Benefits received at the time of retirement like gratuity, pension etc. Note:* 1) Rent free accommodation is not chargeable to tax if provided in remote area. 2) Rent free accommodation provided to High Court or Supreme Court Judges, Union Ministers, Leader of Opposition in Parliament, an official in Parliament and Serving Chairman and members of UPSC is tax free prerequisite. 3) The value so determined shall be reduced by the amount of rent, if any, recovered from the employee. 4) If employee is transferred and retain property at both the places, the taxable value of perquisites for initial period of 90 days shall be determined with reference to only one accommodation (at the option of the assessee). The other one will be tax free. However after 90 days, taxable value of perquisites shall be charged with reference to both the accommodations.
41.	17(2)(i)/(ii) read withRule 3(1)	Rent free furnished accommodation	Taxable value of perquisites shall be computed in following manner: a) Taxable value of perquisite assuming accommodation to be provided to the employee is unfurnished b) Add: 10% of original cost of furniture and fixtures (if these are owned by the employer) or actual higher charges paid or payable (if these are taken on rent by the employer). c) Less: The value so determined shall be reduced by the amount of rent, if any, recovered from the employee
42.	17(2)(i)/(ii) read withRule 3(1)	Accommodation provided in a hotel Hotel accommodation will not be chargeable to tax if : a) It is provided for a total period not exceeding in aggregate 15 days in the financial year; and b) Such accommodation in hotel is provided on employee’s transfer from one place to another place.	Taxable value of perquisite shall be lower of following: a) Actual charges paid or payable by the employer to such hotel; or b) 24% of salary
43.	17(2)(viii)read with Rule 3(2)	Motor Car / Other Conveyance	Taxable value of perquisites (See Note 1 below)
43A.	17(2)(iv)	Any sum paid by employer in respect of any obligation of an employee	Fully Taxable
44.	17(2)(viii)read with Rule 3(3)	Services of a domestic servant including sweeper, gardener, watchmen or personal attendant (taxable only in case of specified employee [See Note 4])	Taxable value of perquisite shall be salary paid or payable by the employer for such services less any amount recovered from the employee.
45.	17(2)(viii)read with Rule 3(4)	Supply of gas, electricity or water for household purposes	Taxable value of perquisites: ➢ Manufacturing cost per unit incurred by the employer., if provided from resources owned by the employer; ➢ Amount paid by the employer, if purchased by the employer from outside agency Note: 1. Any amount recovered from the employee shall be deducted from the taxable value of prerequisite. 2. Taxable in case of specified employees only [See note 4]
46.	17(2)(viii)read with Rule 3(5)	Education Facilities	Taxable value of perquisites (See Note 2 below)
47.	17(2)(viii)read with Rule 3(6)	Transport facilities provided by the employer engaged in carriage of passenger or goods (except Airlines or Railways)	Value at which services are offered by the employer to the public less amount recovered from the employee shall be a taxable perquisite
48.	17(2)(v)	Amount payable by the employer to effect an insurance on life of employee or to effect a contract for an annuity	Fully Taxable
49.	17(2)(vi) read with Rule 3(8)/3(9)	ESOP/ Sweat Equity Shares	Fair Market value of shares or securities on the date of exercise of option by the assessee less amount recovered from the employee in respect of such shares shall be the taxable value of perquisites. Fair Market Value shall be determined as follows: a) In case of listed Shares: Average of opening and closing price as on date of exercise of option (Subject to certain conditions and circumstances) b) In case of unlisted shares/ security other than equity shares: Value determined by a Merchant Banker as on date of exercise of option or an earlier date, not being a date which is more than 180 days earlier than the date of exercise of the option. Note:The Finance Act, 2020 has deferred the taxation of perquisite in case of start-ups from date of allotment to the earliest of the following three dates: 1. Expiry of 48 months from the end of the relevant assessment year; 2. Sale of such shares by the employees; 3. Date on which employee ceases to be employee of the start-up. The eligible start-up shall accordingly, be required to deposit tax with the government within 14 days of the happening of any of the above events (whichever is earlier). However, Section 17(2)(vi) has not been amended, thus the income shall be computed in the year in which shares are allotted but tax shall be paid in subsequent year.
50.	17(2)(vii)	Employer’s contribution towards superannuation fund	Taxable in the hands of employee to the extent such contribution exceeds Rs.1,50,000
51.	17(2)(viii) read with Rule 3(7)(i)	Interest free loan or Loan at concessional rate of interest	Interest free loan or loan at concessional rate of interest given by an employer to the employee (or any member of his household) is a perquisite chargeable to tax in the hands of all employees on following basis: 1) Find out the “maximum outstanding monthly balance” (i.e. the aggregate outstanding balance for each loan as on the last day of each month); 2) Find out rate of interest charged by the SBI as on the first day of relevant previous year in respect of loan for the same purpose advanced by it; 3) Calculate interest for each month of the previous year on the outstanding amount (mentioned in Step 1) at the rate of interest given in Step 24) From the total interest calculated for the entire previous year (step 3), deduct interest actually recovered, if any, from employee5) The balance amount (Step 3-Step 4) is taxable value of perquisiteNothing is taxable if: a) Loan in aggregate does not exceed Rs. 20,000; or b) Loan is provided for treatment of specified diseases ( Rule 3A) like neurological diseases, Cancer, AIDS, Chronic renal failure, Hemophilia (specified diseases). However, exemption is not applicable to so much of the loan as has been reimbursed to the employee under any medical insurance scheme.
52.	17(2)(viii) read with Rule 3(7)(ii)	Facility of travelling, touring and accommodation availed of by the employee or any member of his household for any holiday	a) Taxable value of perquisite shall be expenditure incurred by the employer less amount recovered from employee. b) Where such facility is maintained by the employer, and is not available uniformly to all employees, the value of benefit shall be taken to be the value at which such facilities are offered by other agencies to the public.
53.	17(2)(viii) read with Rule 3(7)(iii)	Free food and beverages provided to the employee	1) Fully Taxable: Free meals in excess of Rs. 50 per meal less amount paid by the employee shall be a taxable prerequisite 2) Exempt from tax: Following free meals shall be exempt from tax: a) Food and non-alcoholic beverages provided during working hours in remote area or in an offshore installation; b) Tea, Coffee or Non-Alcoholic beverages and Snacks during working hours are tax free perquisites; c) Food in office premises or through non-transferable paid vouchers usable only at eating joints provided by an employer is not taxable, if cost to the employer is Rs. 50(or less) per meal.
54.	17(2)(viii) read with Rule 3(7)(iv)	Gift or Voucher or Coupon on ceremonial occasions or otherwise provided to the employee	a) Gifts in cash or convertible into money (like gift cheque) are fully taxable b) Gift in kind up to Rs.5,000 in aggregate per annum would be exempt, beyond which it would be taxable.
55.	17(2)(viii) read with Rule 3(7)(v)	Credit Card	a) Expenditure incurred by the employer in respect of credit card used by the employee or any member of his household less amount recovered from the employee is a taxable prerequisite b) Expenses incurred for official purposes shall not be a taxable perquisite provided complete details in respect of such expenditure are maintained by the employer
56.	17(2)(viii) read with Rule 3(7)(vi)	Free Recreation/ Club Facilities	a) Expenditure incurred by the employer towards annual or periodical fee etc. (excluding initial fee to acquire corporate membership) less amount recovered from the employee is a taxable prerequisite b) Expenses incurred on club facilities for the official purposes are exempt from tax. c) Use of health club, sports and similar facilities provided uniformly to all employees shall be exempt from tax.
57.	17(2)(viii) read with Rule 3(7)(vii)	Use of movable assets of the employer by the employee is a taxable perquisite	Taxable value of perquisites a) Use of Laptops and Computers: Nil b) Movable asset other than Laptops, computers and Motor Car: 10% of original cost of the asset (if asset is owned by the employer) or actual higher charges incurred by the employer (if asset is taken on rent) less* amount recovered from employee.See Note 1* for computation of perquisite value in case of use of the Motor Car
58.	17(2)(viii) read with Rule 3(7)(viii)	Transfer of movable assets by an employer to its employee	Taxable value of perquisites a) Computers, Laptop and Electronics items: Actual cost of asset less depreciation at 50% (using reducing balance method) for each completed year of usage by employer less amount recovered from the employee b) Motor Car: Actual cost of asset less depreciation at 20% (using reducing balance method) for each completed year of usage by employer less amount recovered from the employee c) Other movable assets: Actual cost of asset less depreciation at 10% (on SLM basis) for each completed year of usage by employer less amount recovered from the employee.
59.	17(2)(viii) read with Rule 3(7)(ix)	Any other benefit or amenity extended by employer to employee	Taxable value of perquisite shall be computed on the basis of cost to the employer (under an arm’s length transaction) less amount recovered from the employee. However, expenses on telephones including a mobile phone incurred by the employer on behalf of employee shall not be treated as taxable perquisite.
60.	10(10CC)	Tax paid by the employer on perquisites (not provided for by way of monetary payments) given to employee	Fully exempt
61.	Proviso to section 17(2)	Medical facilities in India	a) Expense incurred or reimbursed by the employer for the medical treatment of the employee or his family (spouse and children, dependent – parents, brothers and sisters) in any of the following hospital is not chargeable to tax in the hands of the employee:i. Hospital maintained by the employer.ii. Hospital maintained by the Government or Local Authority or any other hospital approved by Central Governmentiii. Hospital approved by the Chief Commissioner having regard to the prescribed guidelines for treatment of the prescribed diseases.b) Medical insurance premium paid or reimbursed by the employer is not chargeable to tax.However, the medical facility is taxable only in case of Specified Employees [See note 4]
62.	Proviso to section 17(2)	Medical facilities outside India	Any expenditure incurred or reimbursed by the employer for medical treatment of the employee or his family member outside India is exempt to the extent of following (subject to certain condition): a. Expenses on medical treatment – exempt to the extent permitted by RBI. b. Expenses on stay abroad for patient and one attendant – exempt to the extent permitted by RBI. c. Expenditure incurred on travelling of patient and one attendant- exempt, if Gross Total Income (before including the travel expenditure) of the employee, does not exceed Rs. 2,00,000.
63.	Proviso to section 17(2)	Medical facility or reimbursement for COVID-19 treatment	Any sum paid by the employer in respect of any expenditure actually incurred by the employee on his medical treatment or treatment of any member of his family in respect of any illness relating to Covid-19, shall not be taxable as perquisite in the hands of the employee. However, this benefit shall be allowed subject to certain conditions as may be notified by the Government in this behalf. [applicable w.e.f. Assessment Year 2020-21]

C. Deduction from salary

1.	16(ia)	Standard Deduction	Rs. 50,000 or the amount of salary, whichever is lower (Any salaried person & pensioners)
2.	16 (ii)	Entertainment Allowance received by the Government employees (Fully taxable in case of other employees)	Least of the following is exempt from tax: a) Rs 5,000 b) 1/5th of salary (excluding any allowance, benefits or other prerequisite) c) Actual entertainment allowance received
3.	16(iii)	Employment Tax/ Professional Tax.	Amount actually paid during the year. However, if professional tax is paid by the employer on behalf of its employee than it is first included in the salary of the employee as a perquisite and then same amount is allowed as deduction.

D. Retirement Benefits

Leave Encashment

1.	10(10AA)	Encashment of unutilized earned leave at the time of retirement of Government employees	Fully Exempt
2.	10(10AA)	Encashment of unutilized earned leave at the time of retirement of other employees (not being a Government employee)	Least of the following shall be exempt from tax: a) Amount actually received b) Unutilized earned leave* X Average monthly salary c) 10 months Average Salary** d) Rs. 3,00,000 * While computing unutilized earned leave, earned leave entitlements cannot exceed 30 days for each completed year of service rendered to the current employer Average salary = Average Salary* of last 10 months immediately preceding the retirement ***Salary = Basic Pay + DA (to the extent it forms part of retirement benefits)+ turnover based commission

Retrenchment Compensation

10(10B)

Retrenchment Compensation received by a workman under the Industrial Dispute Act, 1947 (Subject to certain conditions).

Least of the following shall be exempt from tax:
a) Amount calculated as per section 25F(b)of the Industrial Disputes Act, 1947;
b) Rs. 5,00,000; or
c) Amount actually received
Note:
i. Relief under Section 89(1) is available
ii. 15 days average pay for each completed year of continuous service or any part thereof in excess of 6 months is to be adopted under section 25F(b) of the Industrial Disputes Act,1947

Gratuity

4.	10(10)(i)	Gratuity received by Government Employees (Other than employees of statutory corporations)	Fully Exempt
5.	10(10)(ii)	Death -cum-Retirement Gratuity received by other employees who are covered under Gratuity Act, 1972 (other than Government employee) (Subject to certain conditions).	Least of following amount is exempt from tax: 1. (15/26) X Last drawn salary* X completed year of service or part thereof in excess of 6 months. 2. Rs. 20,00,000 3. Gratuity actually received. 7 days in case of employee of seasonal establishment. * Salary = Last drawn salary including DA but excluding any bonus, commission, HRA, overtime and any other allowance, benefits or perquisite
6.	10(10)(iii)	Death -cum-Retirement Gratuity received by other employees who are not covered under Gratuity Act, 1972 (other than Government employee) (Subject to certain conditions).	Least of following amount is exempt from tax: 1. Half month’s Average Salary* X Completed years of service 2. Rs. 20,00,000 3. Gratuity actually received. Average salary = Average Salary of last 10 months immediately preceding the month of retirement * Salary = Basic Pay + DA (to the extent it forms part of retirement benefits)+ turnover based commission

Pension

7.	–	Pension received from United Nation Organization by the employee of his family members	Fully Exempt
8.	10(10A)(i)	Commuted Pension received by an employee of Central Government, State Government, Local Authority Employees and Statutory Corporation	Fully Exempt
9.	10(10A)(ii)	Commuted Pension received by other employees who also receive gratuity	1/3 of full value of commuted pension will be exempt from tax
10.	10(10A)(iii)	Commuted Pension received by other employees who do not receive any gratuity	1/2 of full value of commuted pension will be exempt from tax
11.	10(19)	Family Pension received by the family members of Armed Forces	Fully Exempt
12.	57(iia)	Family pension received by family members in any other case	33.33% of Family Pension subject to maximum of Rs. 15,000 shall be exempt from tax

Voluntary Retirement

13.

10(10C)

Amount received on Voluntary Retirement or Voluntary Separation (Subject to certain conditions)

Least of the following is exempt from tax:
1) Actual amount received as per the guidelines i.e. least of the following
a) 3 months salary for each completed year of services
b) Salary at the time of retirement X No. of months of services left for retirement; or
2) Rs. 5,00,000

Provident Fund

14.

–

Employee’s Provident Fund

For taxability of contribution made to various employee’s provident fund and interest arising thereon see Note 3.

National Pension System (NPS)

15.

10(12A)/10(12B)

National Pension System

Any payment from the National Pension System Trust to an assessee on closure of his account or on his opting out of the pension scheme referred to in section 80CCD, to the extent it does not exceed 60% of the total amount payable to him at the time of such closure or his opting out of the scheme.

Note: Partial withdrawal from NPS shall be exempt to the extent of 25% of amount of contributions made by the employee.

E. Arrear of Salary and relief under section 89(1)

1.	15	Arrear of salary and advance salary	Taxable in the year of receipt. However relief under section 89 is available
2.	89	Relief under Section 89	If an individual receives any portion of his salary in arrears or in advance or receives profits in lieu of salary, he can claim relief as per provisions of section 89 read with rule 21A
3.	89A	Relief under 89A	Relief from taxation in income from retirement benefit account maintained in a notified country in accordance with Rule 21AAA.

F. Other Benefits

1.	–	Lump-sum payment made gratuitously or by way of compensation or otherwise to widow or other legal heirs of an employee who dies while still in active service [Circular No. 573, dated 21-08-1990]	Fully exempt in the hands of widow or other legal heirs of employee
2.	–	Ex-gratia payment to a person (or legal heirs) by Central or State Government, Local Authority or Public Sector Undertaking consequent upon injury to the person or death of family member while on duty [Circular No. 776, dated 08-06-1999]	Fully exempt in the hands of individual or legal heirs
3.	–	Salary received from United Nation Organization [Circular No. 293, dated 10-02-1981]	Fully exempt
4.	10(6)(ii)	Salary received by foreign national as an officials of an embassy, high commission, legation, consulate or trade representation of a foreign state	Fully exempt if corresponding official in that foreign country enjoys a similar exemption
5.	10(6)(vi)	Remuneration received by non-resident foreign citizen as an employee of a foreign enterprise for services rendered in India, if: a) Foreign enterprise is not engaged in any trade or business in India b) His stay in India does not exceed in aggregate a period of 90 days in such previous year c) Such remuneration is not liable to deducted from the income of employer chargeable under this Act	Fully exempt
6.	10(6)(viii)	Salary received by a non-resident foreign national for services rendered in connection with his employment on a foreign ship if his total stay in India does not exceed 90 days in the previous year.	Fully exempt
7.	–	Salary and allowances received by a teacher /professor from SAARC member state (Subject to certain conditions).	Fully exempt

The post Taxability of various components of salary – Income from Different Sources AY 2023-2024 (FY 2022-2023) appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

Guidelines for compulsory selection of returns for Complete Scrutiny during the Financial Year 2022-2023 CBDT Procedure for compulsory selection

admin — Tue, 07 Jun 2022 08:09:54 +0000

CBDT Complete Scrutiny

F.No.225/ 81/2022/ITA-II
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes (ITA-II division)

North Block, New Delhi, the 03rd June, 2022

All Pr. Chief Commissioners of Income-tax/ Chief Commissioners of Income-tax
All Pr. Director Generals of Income-tax/ Director Generals of Income-tax.

Madam/Sir

Subject: Guidelines for compulsory selection of returns for Complete Scrutiny during the Financial Year 2022-23 – procedure for compulsory selection in such cases -regarding.

Kindly refer to CBDT’s Guidelines dated 11.05.2022 on the above-mentioned subject (copy enclosed).

2. With reference to the above, I am directed to state that Sl.No.2 of para no.2 of CBDT’s Guidelines dated 11.05.2022 shall be substituted as under:

2. Cases pertaining to search & seizure/requisition

Sl. No.	Parameter	Procedure for compulsory selection
2.1	Search & seizure/ requisition prior to 01.04.2021: Assessments in search & seizure cases to be made under Section(s) 153A, 153C read with section 143(3) of the Act and also for return filed for assessment year relevant to previous year in which the search was conducted u/s 132 or requisition was made u/s 132A of the Act.	The cases shall be selected for scrutiny with prior administrative approval of Pr. CIT/Pr. DIT/CIT/DIT concerned, who shall ensure that such cases are transferred to Central Charges u/s 127 of the Act within 15 days of service of notice u/s 143(2)/ 142(1) of the Act by the Assessing Officer concerned. Where such cases are not centralized and Return of Income is filed in response to notice u/s l 53C, the Assessing Officer concerned shall serve notice u/s 143(2) of the Act. Where such cases are not centralized and no Return of Income is filed in response to notice u/s l53C, the Assessing Officer concerned shall serve notice u/s 142(1) of the Act calling for information.
2.2	Search & seizure/requisition on or after 01.04.2021: Assessments in cases arising from search & seizure actions/requisitions u/s 132/ 132A conducted on or after 01.04.2021, for returns pertaining to A.Y. 2021-22.	The cases shall be selected for scrutiny with prior administrative approval of Pr. CIT/Pr. DIT/CIT/DIT concerned, who shall ensure that such cases are transferred to Central Charges u/s 127 of the Act within 15 days of service of notice u/s 143(2)/142(1) of the Act by the Assessing Officer concerned.

3. All other contents of the said Guidelines will remain unchanged.

4. The above may be brought to the notice of all concerned for necessary compliance.

Enclosure: As above

(Ravinder Maini)
Director (ITA-II), CBDT

CBDT Complete Scrutiny

The post Guidelines for compulsory selection of returns for Complete Scrutiny during the Financial Year 2022-2023 CBDT Procedure for compulsory selection appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

Deduction of Income Tax on interest of GPF subscription over Rs. 5 Lakhs

admin — Fri, 18 Feb 2022 17:12:17 +0000

GPF interest rate income tax

Defence Accounts Department (DAD) Headquarters
Ulan Batar Road, Palam, Delhi Cantt – 110010

AT/Army/BR/ FC/4462/E-1754

Dt 18/02/2022

To,
The CDA(Fund) Meerut
PCDA(O) Pune
All Regional PCsDA/CsDA
CDA(IT&SDC)
PCDA Navy
PCDA(AF)

Subject: Calculation of Income Tax on Interest of GPF – Regarding.

Please refer MoF Department of Revenue(CBDT)’s notification No.95/2021/File No. 370142/36/2021-TPL dated 31-08-2021(Copy enclosed) regarding deduction of Income Tax on interest of GPF subscription over Rs. 5 Lakhs during the financial year 2021-22.

2. The provisions of notification and action there of:

(i) Exercising the powers conferred by the first proviso to clause(11) of section 10 and first proviso to clause(12) of section 10 read with section 295 of the Income-Tax Act, 1961(43 of 1961), the CBDT has inserted a Rule 9D namely Income-tax (25th Amendment) Rule 2021 after Rule 9C of Income-tax Rule 1962 which stipulates Calculation of taxable interest relating to contribution in a provident fund or recognized provided fund, exceeding specified limit of Rs. 5 Lakhs.,
(ii) The interest earned on contribution above Rs. 5 Lakhs during FY 2021-22 should be treated as income from other sources for the FY 2021-22(AY 2022-23) and income tax should be deducted from salary paid during the FY 2021-22 itself. Same should be reflected in Form-16 of Fy 2021-22(AY 2022-23) accordingly.
(iii) Action on the part of DDO & Fund manager: Deduction of tax will be done by DDO in consultation with fund manager and where Fund manager and DDO are separate bodies the Fund manager will calculate the interest earned on contribution as per ibid rules and inform the DDO for adjustment of tax deduction from the salary of concerned individual

The CBDT notification mentioned above may be implemented wef 01 April 2022.

This issues with the approval of Addl. CGDA.

Encl: As above

AO (Pay & Allowances)

The post Deduction of Income Tax on interest of GPF subscription over Rs. 5 Lakhs appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

Paying tribute to the retired Senior Officers

admin — Mon, 20 Sep 2021 06:33:11 +0000

Departed Senior Retired Officers – We frequently hear about the passing of numerous Senior Retired Officers from the department around the country. These department’s Senior Retired Officers have spent their lives serving the department and the country.

Office of the Pr. Chief Commissioner of Income Tax,
Andhra Pradesh & Telangana, Hyderabad,
10th Floor, Income Tax Towers, A C Guards, Hyderabad – 500 004.
Tel. No. 040 – 23425474, 23241427 Fax: 040 23240403

E No. Pr.CCIT/Circulation/2021-22

Date:15.09.2021

The Chief Commissioner of Income Tax(ReFAC), Vijayawada,
The Chief Commissioner of Income Tax, Hyderabad,
The Director General of Income Tax(Inv), Hyderabad,
The Chief Commissioner of Income Tax (ReFAC), Visakhapatnam,

Sir/ Madam,

Sub: Paying respect to the departed Senior Officers of the department – reg.

Ref: Letter received from Pr.DGIT(HRD), New Delhi dated 03.09.2021.

In relation to the captioned subject, 1 am directed to forward herewith the above referred letter of Pr.DGIT(HRD), New Delhi, for your information and necessary action.

I am further directed to communicate that, in recognition of the lifetime contribution of the departed Officer, the office of the Pr.CCIT/CCsIT posted in the home station of the departed officer may place a wreath alongwith a message during the condolence meeting for the officer, as a mark of respect and to pay tribute to the departed soul, on behalf of the entire Income Tax fraternity.

Yours faithfully,

(B. SRINIVASA RAO)
Joint Commissioner of Income Tax(OSD),
(HQrs)(Admin),
O/o.Pr.CCIT, AP&TS, Hyd.

Encl: As above.

PRINCIPAL DIRECTOR GENERAL
OF INCOME TAX (HRD) NEW DELHI
No. 114, 2nd Floor, Jawahar Lal Nehra Stadium
Pragati Vihar, New Delhi -110001

Date: 03.09.2021

Sub: Paying respect to the departed Senior Retired Officers of the department- reg.

Very often, we come across the news of the demise of several Senior Retired Officers of the department across the country. These Senior Retired Officers of the department have dedicated their lifetime to the service to the department & the nation. They have also left memories and indelible imprints upon the Income Tax Family. It is felt that as service members, the Income tax Fraternity should show its support to the bereaved family in their hour of grief.

Hence, it is desired that in recognition of the lifetime contribution of the departed Officer, the office of the Pr.CCIT/ CCsIT posted in the home station of the departed officer, may place a wreath alongwith a message during the condolence meeting for the officer, as a mark of respect and to pay tribute to the departed sow, on behalf of the entire Income Tax fraternity. It is desired that the Income Tax fraternity stands together in these unprecedented times as one family to help tide over the loss while keeping the legacy of the departed Officer intact.

With regards

Yours sincerely

Sd/-
(Smita Jhingran)

The post Paying tribute to the retired Senior Officers appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

CBDT grants further relaxation in electronic filing of Income Tax Forms 15CA/15CB – PIB

admin — Mon, 05 Jul 2021 16:12:45 +0000

Ministry of Finance
CBDT grants further relaxation in electronic filing of Income Tax Forms 15CA/15CB

05 JULY 202

As per the Income-tax Act, 1961, there is a requirement to furnish Form 15CA/15CB electronically. Presently, taxpayers upload the Form 15CA, along with the Chartered Accountant Certificate in Form 15CB, wherever applicable, on the e-filing portal, before submitting the copy to the authorised dealer for any foreign remittance.

In view of the difficulties reported by taxpayers in electronic filing of Income Tax Forms 15CA/15CB on the portal www.incometax.gov.in, it had earlier been decided by CBDT that taxpayers could submit Forms 15CA/15CB in manual format to the authorized dealer till 30th June 2021.

It has now been decided to extend the aforesaid date to 15th July, 2021. In view thereof, taxpayers can now submit the said Forms in manual format to the authorized dealers till 15th July, 2021. Authorized dealers are advised to accept such Forms till 15th July, 2021 for the purpose of foreign remittances. A facility will be provided on the new e-filing portal to upload these forms at a later date for the purpose of generation of the Document Identification Number.

PIB

The post CBDT grants further relaxation in electronic filing of Income Tax Forms 15CA/15CB – PIB appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

If interest on a housing loan is claimed under Section 24(b) of the Income Tax Act for FY2020-21, the lender’s (bank’s) PAN is required.

admin — Sat, 01 May 2021 08:07:24 +0000

If interest on a housing loan is claimed under Section 24(b) of the Income Tax Act for FY2020-21, the lender’s (bank’s) PAN is required.

PAN of lender (PAN of Bank) required, if interest on housing loan is claimed under Section 24(b) of Income Tax for FY 2020-21

Principal Controller of Defence Accounts
(Central Command)
Cariappa Road, Lucknow Cantt.-226002

No ANAV/Pay/Circular/2021-22/1

Date- 28/04/2021

The Officer-in-charge
All Sections Main Office
All Sub Offices under the PCDA (CC) Lucknow

Sub: PAN of lender (PAN of Bank), if interest on housing loan is claimed under section 24(b) FY 2020-21.

***

Please find list in Annexure-A of officers and staff who have claimed rebate under Section 24(B) in FY 2020-21.

As per provisions in Income Tax act, PAN of lender (PAN of Bank) is to be uploaded at TIN NSDL and it has been made mandatory, if interest on housing loan is claimed under section 24(b).

Hence, it is requested to obtain the details from concerned officer and staff and furnish PAN of lender in following format so that yearly data (Quartery Q4 FY 2020-21) can be uploaded to Income Tax department.

S.No.	Name of employee	Designation & AC No.	Name of sender (Name of Bank)	PAN of lender (PAN of Bank)

In this regards, it is requested that same may be received by 05/05/2021 positively to the email ID of AN-IV Section.

Jt. CDA has seen.

Accounts Officers (AN-IV)

Source: http://pcdacc.gov.in/download/circularsnew/an4_2904.pdf

The post If interest on a housing loan is claimed under Section 24(b) of the Income Tax Act for FY2020-21, the lender’s (bank’s) PAN is required. appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

ITR -Extension of time limits for income tax returns – PIB News

admin — Wed, 30 Dec 2020 13:37:39 +0000

Extension of time limits for income tax returns

Ministry of Finance

Extension of time limits for income tax returns

Posted On: 30 DEC 2020

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.

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 were 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) was also extended to 31st October, 2020.

In order to provide more time to taxpayers for furnishing of Income Tax Returns, the due date was further extended vide notification No 88/2020/F. No. 370142/35/2020-TPL dated 29th October, 2020:

(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 said extension) as per the Act was 31st October, 2020] was 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 said extension) as per the Act was 30th November, 2020] was 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 said extension) as per the Act was 31st July, 2020] was extended to 31st December, 2020.
(D) 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 was also extended to 31st December, 2020.

Considering the problems being faced by the taxpayers, it has been decided to provide further time to the taxpayers for furnishing of Income Tax Returns, tax audit reports and declaration under Vivad Se Vishwas Scheme. Further, in order to provide more time to taxpayers to comply under various ongoing proceedings, the dates of completion of proceedings under various Direct Taxes & Benami Acts have also been extended. These extensions are as under:

a. The due date for furnishing of Income Tax Returns for the Assessment Year 2020-21 for the taxpayers (including their partners) who are required to get their accounts audited and companies [for whom the due date, as per the provisions of section 139(1) of the Income-tax Act,1961, was 31st October, 2020 and which was extended to 30th November, 2020 and then to 31st January, 2021] has been further extended to 15th February, 2021.
b. The due date for furnishing of Income Tax Returns for the Assessment Year 2020-21 for the taxpayers who are required to furnish report in respect of international/specified domestic transactions [for whom the due date, as per the provisions of section 139(1) of the Income-tax Act,1961, was 30th November, 2020 and which was extended to 31st January, 2021] has been further extended to 15th February, 2021.
c. The due date for furnishing of Income Tax Returns for the Assessment Year 2020-21 for the other taxpayers [for whom the due date, as per the provisions of section 139(1) of the Income-tax Act, 1961, was 31st July, 2020 and which was extended to 30th November, 2020 and then to 31st December, 2020] has been further extended to 10th January, 2021.
d. The date for furnishing of various audit reports under the Act including tax audit report and report in respect of international/specified domestic transaction for the Assessment Year 2020-21 has been further extended to 15th January, 2021.
e. The last date for making a declaration under Vivad Se Vishwas Scheme has been extended to 31st January, 2021 from 31st December, 2020.
f. The date for passing of orders under Vivad Se Vishwas Scheme, which are required to be passed by 30th January, 2021 has been extended to 31st January, 2021.
g. The date for passing of order or issuance of notice by the authorities under the Direct Taxes & Benami Acts which are required to be passed/ issued/ made by 30th March, 2021 has also been extended to 31st March, 2021.

Further, in order to provide relief for the third 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 15th February, 2021 for the taxpayers mentioned in para 4(a) and para 4(b) and to 10th January, 2021 for the taxpayers mentioned in para 4(c).

The Government has also extended the due date of furnishing of annual return under section 44 of the Central Goods and Services Tax Act, 2017 for the financial year 2019-20 from 31st December, 2020 to 28th February, 2021.

The necessary notifications in this regard shall be issued in due course

PIB

The post ITR -Extension of time limits for income tax returns – PIB News appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

Last date for submitting Income Tax Returns has been extended to 31st January, 2021 – PIB News

admin — Mon, 26 Oct 2020 03:31:37 +0000

Last date for submitting Income Tax Returns has been extended to 31st January, 2021

PIB News

Extension of due date of furnishing of Income Tax Returns and Audit Reports

The Government issued a Notification on 24thJune, 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.

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:

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.
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.
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.

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.

Check: 30 days bonus for Central Government Employees -Non-Productivity Linked Bonus (ad-hoc bonus) for the year 2019-2020 – FinMin Order

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.

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).

The necessary notification in this regard shall be issued in due course.

PIB

The post Last date for submitting Income Tax Returns has been extended to 31st January, 2021 – PIB News appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

CBDT – Compulsory selection of returns for Complete Scrutiny during the Financial Year 2020-21

admin — Sun, 20 Sep 2020 15:57:57 +0000

CBDT

F.No.225/126/ 2020/ITA-II
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes (ITA-II division)

North Block, New Delhi,
the 11September, 2020

All Pr. Chief-Commissioners of Income-tax/ Chief-Commissioners of Income-Tax All Pr. Director-Generals of Income tax/ Director-Generals of Income-tax.

Subject: Guidelines for compulsory selection of returns for Complete Scrutiny during the Financial Year 2020-21 – conduct of assessment proceedings in such cases – regarding.

Madam/ Sir

Kindly refer to the above.

2. Keeping in view of the Faceless Assessment Scheme, 2020 implemented by the Department and the difficulties being faced amid COVID-19 pandemic, the parameters for compulsory selection of returns for Complete Scrutiny during Financial Year 2020-21 and conduct of assessment proceedings in such cases are prescribed as under:

S No.	The Parameter	Assessment Proceedings to be conducted by
1	Cases pertaining to survey u/s 133A of the Income-tax Act,1961(‘Act’)
	Cases pertaining to survey u/s 133A of the Act, excluding those cases where books of accounts, documents, etc. were not impounded and returned income (excluding any disclosure made during the Survey) is not less than returned income of preceding assessment year . However, where assessee has retracted from disclosure made during the Survey, such cases will be considered for scrutiny.(i) In respect of such cases selected for compulsory scrutiny and where there is impounded material(ii) In respect of such cases selected for compulsory scrutiny and where there is no impounded material	(i) After the issue of notice u/s 143(2) of the Act by the Jurisdictional Assessing Officer for compulsory selection, such cases shall be transferred to Central Charges u/s 127 of the Act within 15 days of issue of notice u/s 143( 2) of the Act.(ii) After the issue of notice u/s 143(2) of the Act by the Jurisdictional Assessing Officer for compulsory selection, assessment proceedings in such cases will be conducted by NeAC. The Assessing Officer shall upload the Survey Report in the ITBA at the time of issue of notice u/s 143(2) of the Act.

2	Cases pertaining to Search and Seizure
	Assessments in Search and Seizure cases to be made under section(s) 153A, 153C read with section 143(3) of the Act and also for return filed for assessment year relevant to previous year in which authorization for Search and Seizure was executed under section 132 or 132A of the Act .	The cases falling u/s 153C, if lying outside Central Charges, shall be trans ferred to Central Charges u/s 127 of the Act within 15 days of issue of notice u/s 143(2) for compulsory selection .
3.	Cases in which notices u/s 142(1) of the Act, calling for return, have been issued
	Cases where no return has been furnished in response to a notice u/s 142(1) of the Act.	These cases will be taken up for compulsory scrutiny by NeAC.
	Cases where return has been furnished in response to notice u/s 142(1) of the Act and where notice u/s 142{1) of the Act was issued due to the information contained in NMS Cycle/ AIR information/ information received from Directorate of IC&I.	These cases will not be taken up for compulsory scrutiny and the selection of such cases for scrutiny will be through CASS cycle.
	Cases where return has been furnished in response to notice u/s 142{1) of the Act and where notice u/s 142(1) of the the Act was issued due to the specific information received from Law Enforcement Agencies , including the Investigation Wing; Intelligence/ Regulatory Authority/ Agency ; Audit Objection; etc.	After the issue of notice u/s 143{ 2) of the Act by Jurisdictional Assessing officer for compulsory selection, assessment proceedings in such cases will be conducted by NeAC

4.	Cases in which notices u/s 148 of the Act have been issued
	Cases where no return has been furnished in response to notice u/s 148 of the Act	In such cases, Jurisdictional Assessing shall issue notice u/s 142{1) of the Act, calling for information regarding the issues on the basis of which notice u/s 148 was issued, subsequent to which, assessment proceedings in such cases will be conducted by NeAC.
	Cases where return has been furnished in response to notice u/s 148 of the Act and where notice u/s 148 of the Act was issued due to the information contained in NMS Cycle/ AIR information/ information received from Directorate of IC&I.	These cases will not be taken up for compulsory scrutiny and the selection of such cases for scrutiny will be through CASS cycle.
	Cases where return has been furnished in response to notice u/s 148 of the Act and where notice u/s 148 of the Act was issued due to the specific information received from Law Enforcement Agencies, including the Investigation Wing; Intelligence/ Regulatory Authority/ Agency; Audit Objection;	After the issue of notice u/s 143(2) of the Act by the Jurisdictional Assessing Officer for compulsory selection, assessment proceedings in such cases will be conducted by NeAC.
5.	Cases related to registration/ approval under various sections of the Act, such as 12A, 35(1){ii)/ (iia)/(iii), 10{23C), etc.
	Cases related to registration/ approval under various sections of the Act, such as 12A, 35(1){ii)/(iia) /(iii), 10{23C), etc have not been granted or have been cancelled/withdrawn by the Competent Authority, yet the assessee has been found to be claiming tax-exemption/ deduction in the return. However, where such orders of withdrawal of registration/ approval have been reversed/ set-aside in appellate proceedings, those cases will not be selected under this clause.	After the issue of notice u/s 143{ 2) of the Act by the Jurisdictional Assessing Officer for the Jurisdictional Assessing Officer for compulsory selection, assessment proceedings in such cases will be conducted by NeAC.

3. Without prejudice to the above, the cases which are selected for compulsory scrutiny by the International Taxation and Central Circle charges following the above prescribed guidelines, shall, as earlier, continue to be handled by these charges.

Also check: CBDT clarifies the TDS provisions on Mutual Fund dividend

4. . The exercise of selection of cases for compulsory scrutiny on the basis of the above parameters shall be completed by 30th September 2020.

5. These instructions may be brought to the notice of all concerned for necessary compliance .

-sd-

(Rajarajeswari R.)
Under Secretary-ITA.II, CBDT

The post CBDT – Compulsory selection of returns for Complete Scrutiny during the Financial Year 2020-21 appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.

CBDT – Adherence of delegated Financial Powers & Time-lines by HoDs

admin — Mon, 06 Jul 2020 04:38:12 +0000

CBDT

F.No.DIT (Inf)/ U-I/Misc.-1/ 2020-21/148
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
CENTRAL BOARD OF DIRECT TAXES
DIRECTORATE OF INCOME TAX (INFRA.)

Dated: 30.06.2020

To
All HoDs (Pr. CCsIT/Pr. DGsIT/CCsIT/ DGsIT/Pr. CsIT/Pr. DsIT/ CsIT/ADGs)

Madam /Sir,

Kind attention is invited to the O.M. issued by IFU vide F. No. 15/6/2008-IFU-III (EC) dated 15.09.2011 (Copy enclosed as Annexure-I) regarding delegated Financial Powers to the Head of Departments (HoDs). The partial modification of the OM F. No. 15/6/2008-IFU.III dtd.15.09.2011 was made vide OM under F. No. 14/11/2017-IFU (B&A) DT dated 16.08.2017 (Copy enclosed as Annexure-II).

2. As per the said OM, the financial powers upto Rs.60/90 lakhs per annum have been delegated to the Head of Departments of CBDT for ‘Outsourcing of Services” and all HoDs have to follow above OMs. However, several instances have come to the notice of CBDT wherein it has been noted that these OMs are not being followed and HODs are sanctioning expenditure on outsourcing of services beyond their delegated financial powers either by way of entering into fresh contracts or by extending the existing contracts. Subsequently when the ZAOs refuse to clear the bills for want of sanction of the competent authority, proposals are sent to the DIT(Infra) for seeking ex-post facto approval of the competent authority.

Further, in matter of sanctioning of works also, it has come to notice of CBDT that many times field authorities alter/add to the scope of originally sanctioned works beyond their delegated financial powers without prior approval of the competent authority. This has, at times, led to litigation between the contractor and the Department due to delayed payments for want of sanction of the competent authority resulting in levy of interest and cost by the courts.

Therefore, it is hereby reiterated that field authorities should not sanction expenditure pertaining to ‘Outsourcing of Services” or should not sanction works or add to the sanctioned works beyond their delegated financial powers without taking prior approval of the competent authority.

3. Moreover, it has been observed that proposals seeking ex-post facto approval of the competent authority in cases of renewal/revision of rent agreements, execution of works and outsourcing of services are being sent to this Directorate in a routine manner without any detailed reasons and valid justification for the delay in submitting such proposals. Such ex post facto approval cases are viewed very adversely by the higher authorities and the IFU.

4. Therefore, I am directed to hereby reiterate that field authorities should not award contracts for outsourcing of services or sanction works beyond the delegated financial powers and also submit the proposals well in time.

5. This is issued with the prior approval of Pr.DGIT (Admin. & TPS).

Encl: As above.

(H.Pradeep Rao)
Joint Secretary & Financial Adviser (Finance)

The post CBDT – Adherence of delegated Financial Powers & Time-lines by HoDs appeared first on CENTRAL GOVERNMENT EMPLOYEES NEWS.