Penalty Rationalization and Assessment procedures - What Budget says

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..... Penalty Rationalization and Assessment procedures - What Budget says
By: - CSSwati Rawat
Budget - Tax Proposals
Dated:- 1-3-2016

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 @ .....

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..... 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 ou .....

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..... t 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 .....

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..... has been filed, such income has been understated or excess loss/deduction/allowance has been claimed.Effective from 1 June 2016. * Summary assessment mandatory before detailed scrutiny assessment * Reduction in time-limit for assessment/ reassessment by 3 months * Interest receivable by the taxpayer - Assessees eligible for interest on refund arising from self- assessment tax - Add .....

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..... itional interest @ 3% if there is delay in giving effect to appellate orders * Order of DRP not appealable by tax authorities going forward * Mandatory stay if assessee pays 15% of disputed demand pending appeal * Application for stay of tax demand to be disposed off within 12 months
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