Commissioners of Income-tax should pass comprehensive orders and also obtain from the assessees comprehensive letters of agreement covering all points penalties u/s. 271(1)(a), u/s. 273 interests u/s. 139, 215 and 217. - Income Tax - 404/CBDT

INSTRUCTION NO. 404/CBDT Dated: April 6, 1972 A scrutiny of some of the petitions addressed to the Board on the settlements finalized by the Commissioners in the last few months has revealed that the formal orders passed by the Commissioners at the conclusion of a settlement are not comprehensive. More often than not the Commissioners have been confining themselves to the quantum of settlement the spread over, and the penalty for concealment. The orders passed by the Commissioners and the agreement letters obtained from the assessees in this connection are silent about other issues like penalties u/s. 271(1)(a), penalties u/s. 273 interests u/s. 139, 215 and 217 etc. The assessees make a grievance of this omission on the part of the Commissioners later on and plead that it was their understanding that all other penalties and interests etc., would be dropped. Some times a reference is even made to certain oral discussions with the Commissioners in which they were assured that these matters would be considered sympathetically. The assessees naturally interpret such assurances as amounting to virtual dropping of proceedings on all other points. 2. This is a very unsatisfactory state of affairs. The Board therefore desires that Commissioners of Income-tax should pass comprehensive orders and also obtain from the assessees comprehensive letters of agreement covering all points such as prosecutions the various penalties imposable under the Act, the various interests leviable under the Act and finally the time in which the taxes are to be paid the security to be offered by the assessees in payments of taxes etc. 3. These instructions may kindly be noted for strict compliance.