Penalty
Rationalization of existing penalty provisions
- Penalty to be levied in case of ‘under-reporting’ and ‘misreporting’ of income (w.e.f. 1 April 2017)
- Under-reported income: Penalty @ 50% of tax payable
- Misreporting of income: Penalty @ 200% of tax payable
- Under reporting defined objectively to be the difference between assessed income and income as per summary assessment
- ‘Misreported’ income defined to cover:
- Failure to report any international transaction
- Misrepresentation or suppression of facts
- Unsubstantiated claim of expenditure
- AO empowered to grant immunity from penalty / prosecution not arising out of ‘misreporting’ if applicable taxes and interest are paid
Assessment procedures
- Increase in scope of “deemed” cases of income escaping assessment - Now Assessing officer has power to reopen cases on the basis of information or documents received from the prescribed income tax authority after processing, where it is noticed that either a return of income has not been filed or where return has been filed, such income has been understated or excess loss/deduction/allowance has been claimed.Effective from 1 June 2016.
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Summary assessment mandatory before detailed scrutiny assessment
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Reduction in time-limit for assessment/ reassessment by 3 months
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Interest receivable by the taxpayer
- Assessees eligible for interest on refund arising from self- assessment tax
- Additional interest @ 3% if there is delay in giving effect to appellate orders
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Order of DRP not appealable by tax authorities going forward
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Mandatory stay if assessee pays 15% of disputed demand pending appeal
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Application for stay of tax demand to be disposed off within 12 months
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