Prompt issue of Refund-Instruction regarding. - Income Tax - 1952/1998

INSTRUCTION NO. 1952/1998 Dated: August 14, 1998 Subject: Prompt issue of Refund-Instruction regarding. The Board have noted with concern the mounting pendency of refund claims and would like to impress upon the income-tax authorities the need for taking effective steps for elimination of delay in these matters. Instructions have already been issued to the effect that all refund vouchers should invariably be despatched by registered post with acknowledgment due within 15days of the date on which the total income is computed/recomputed and the refund due is determined irrespective of the value of refund. It is now emphasised that such refund amounts should also include the correct amount of interest due to the assessee. Moreover, the officers should take due care to ensure all entries in the refund voucher, advise and on the envelop are correctly made. The Chief Commissioners may take suitable steps to ensure that the correct amount of refund reaches the assessee expeditiously. These steps are necessary to reduce refund related grievances drastically during the current year in view of tile Action Plan emphasis on grievance redressal. 2. While withholding a refund, the provisions of section-241 should be observed meticulously. In all such cases, a conscious and objective decision should be taken at the level of Commissioner Of Chief Commissioner as the case may be and the assessee should invariably be informed or the decision to withhold the refund. 3. No refund may be withheld merely to be adjusted against demand to be created in future, as the same would be against the spirit of Law embodied in section-245, of the Income-Tax Act, which permits set off of refunds only against tax remaining payable under the Act by the person to whom the refund is due and not against any tax demands which may arise in future in case of that person. 4. A fact which is often lost sight of by the field officers is that, section-245 requires them to issue a written intimation to the refundee regarding, the proposal for adjustments of refund. In fulfilment of the statutory, requirement the field officers should invariably issue written intimation in all cases where refund adjustments are proposed. 5. All claims for refund made by senior citizens (65 years or above) may be settled on the spot as far as possible. In the event the same does not become feasible due to some administrative constraints, the Chief Commissioners may take suitable steps to ensure that refund due to senior citizen is settled within a maximum period of 3 months from the date of filing of return or refund claim. F.No.212/16/98-ITA-II R.N. DASH Director to the Govt. of India