CBDT Updates (January 2021 to March 2021) – Applicable for FY 2021-22 – SK Patodia

CBDT Updates (January 2021 to March 2021) – Applicable for FY 2021-22

1. Introduction of Faceless Penalty Scheme, 2021:

Likewise, Faceless Assessments and Faceless Appeals launched in the year 2020, the government has now introduced Faceless Penalty Proceedings effective from 12 January 2021 with the aim of establishing a transparent economy.

[Notification 03/2021 – dated 12 January 2021]

2. Re-registration of Charitable Trusts:

Finance Act, 2020 completely revamped the provisions applicable to a Charitable Trust under the Act that are related to re-registration of all the existing registered trusts, renewal of registration, approval for deduction u/s 80G of the Act and furnishing statement of donations received to the Income Tax Authorities. The only aim is to weed out all the inactive and defunct charitable institutions. Accordingly, w.e.f. 01 April 2021, every charitable trust that has a certificate under section 12AA of the Act should apply for renewal of its registration certificate, which shall be valid only for 5 years. Likewise, the Finance Bill 2020 also provides to obtain re-approval of all the existing section 80G status and the application for the same should be submitted within three months from the effective date, on or before 30 June 2021. This should be noted that such 80G status shall be again available only for 5 years, post which it would require re-approval.

[Notification 19/2021 – dated 26 March 2021]

3. Vivad-se-Vishwas Scheme (VsV Scheme):

Clarification issued by Income tax Department w.r.t cases to be considered as Search Cases for obtaining benefit under the VsV Scheme. For this, CBDT issued a circular confirming that, where a search has been conducted on an assessee / any related person, then the assessments made u/s 143(3) – regular assessment/ section 144 – Best judgement assessment/ section 147 – income escaping assessment/ section 153A/ 153C/ 158BC – search assessments would be treated as Search assessments only.

[Circular 04/2021 – dated 23 March 2021]

Last date for payment of taxes under VsV Scheme to avoid paying 110% of the amount determined under the said scheme is 30 April 2021.

4. Pre-filled ITR Forms – FY 2020-21:

To further ease filing of returns, details of capital gains from listed securities, dividend income, and interest from banks, post office, etc. will also be pre-filled in the ITR forms.

[Notification 16/2021 dated 12 March 2021]

5. Higher TDS/ TCS rates for non-filers of ITRs:

Any taxpayer, who has not filed income tax returns for the last 2 years, will be subject to higher TDS/ TCS rates, where the TDS/ TCS liability is INR 50,000 or more.

[Finance Bill 2021- w.e.f 01 July 2021]

6. Launching of e-portal for filing complaints of tax evasion/ benami properties/ foreign undisclosed assets:

Yet another initiative of the Income Tax Department of easing the reach of public to the Department – Public can now blow whistle against any tax evader by filing a ‘Tax Evasion Petition’ on the CBDT’s e-filing portal.

[Press Release dated 12 January 2021]

7. Extension of time limit for intimation of Aadhar details to Income Tax Department:

The timeline to link Aadhaar with PAN card is extended from 31 March 2021 to 30 June 2021.

[Notification 20/2021 – dated 31 March 2021]

8. Extension of time limits related to assessments:

The time limit to pass order u/s 144C (Best judgement assessment); or issuance of notice for income escaping assessment u/s 148/ 151, whose time limit was expiring on 31 March 2021 shall stand extended to 30 April 2021.

[Notification 20/2021 – dated 31 March 2021]

9. Extension of time limit to impose penalties and to complete search proceedings:

Last date to impose a penalty shall be 30-06-2021 for the timelines falling during the period between 20-03-2020 to 29-06-2021. Further, in respect of the issue of notice the time limit for completion of such action would be 30-09-2021 for the timelines falling during the period between 20-03-2020 to 30-06-2021.

[Notification 10/2021 – dated 27 February 2021]

10. Online application for lower withholding certificates by tax deductors in case of Non-resident payees:

W.e.f 01 April 2021, tax deductors, who are required to deduct taxes from payments made to non-resident payees, will now be able to make an online application to income-tax authorities, on behalf of its non-resident payees, to provide lower/Nil withholding certificates.

[Notification 18/2021 – dated 16 March 2021]