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INTRODUCTION:

The Central Board of Direct Taxes ('CBDT') on 31st March 2020 provided relief to many taxpayers vide the Notification bearing reference no. F.No. 275/25/2020- IT(B).

The Department taking a note of the ongoing crises due to the COVID-19 Pandemic stated that, the numerous applications filed for F.Y. 2020-21 under the following sections of the Income Tax Act,1961 ('Act') could not be attended by the Assessing Officers in a timely manner thus leading to hardship faced by the taxpayers -

  • 195 [Other Sums] & 197 [Certificate for Deduction at Lower Rate] respectively for lower or nil rate of deduction of TDS; and
  • 206C (9) [Profits and Gains from the Business of Trading in Alcoholic Liquor, forest produce, scrap etc.]

Therefore, while the offices across India are observing a Lockdown, the CBDT considering the current crisis situation has provided for the following 'Relief Extensions' to the concerned taxpayers:

SCENARIO 1:

For assesses who have already made applications for lower or nil deductions of TDS/TCS on the Traces Portal for F.Y. 2020-21, and are still pending at the Department, but the assesses have been issued certifications for the same F.Y. 2020-21:

Such issued certificates would automatically become applicable till 30th June 2020 of F.Y. 2020-21 OR disposal of their applications by the Assessing Officers, whichever is earlier.

SCENARIO 2:

CBDT Extension of validity of lower/nil TDS: A sigh of relief

For assesses who have been issued certificates, but could not apply for issue of lower or nil deduction of TDS/TCS on the Traces Portal for F.Y. 2020-21:

Such issued certificates will also become applicable till 30th June 2020 for F.Y. 2020-21.  

However, such assesses shall be required to furnish details of the transactions to the TDS/TCS Assessing Officer at the earliest as per the procedure established by law, as soon as the normalcy is restored or latest by 30th June 2020, whichever is earlier.

SCENARIO 3:

For assesses who have neither made an application on TRACES Portal, nor have received the certificate for F.Y. 2020-21:

They shall abide by the procedure for application as laid down in the Annexure to this 31st March 2020 Notification.

 

Procedure as laid down in the Annexure:

1. Application to be made under Section 197/206C (9) of the Act vide an email addressed to the concerned Assessing Officer.

2. The Email to provide the following details:

  • Duly Filled in Form 13 (Annexure I and/or Annexure III);
  • Documents/information as required to be uploaded on TDS-CPC website, while filling of Form 13;
  • Projected Balance Sheet and P&L account of FY 2020-21;
  • Provisional Balance Sheet and P&L account of FY 2019-20;
  • Form 26AS for FY 2019-20 & 2018-19;
  • ITR pertaining to FY 2018-19.
 

CONCLUSION:

The Department taking a note of the hardship faced by taxpayers and business during the current time of Pandemic has provided a wave of relief.

This step shall be considered as a positive move by the Department in the interest of the taxpayers to avoid payments of any form of penalty or interest.

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