I need your advice on a notification I received from CPC yesterday titled "Communication of Arrear Demand". It is a demand note for an amount of INR 49k. The AY is mentioned as 2008 and Section as 143(1). The letter is dated 19-10-2011 and there is an interest calculation in the demand amount till 13-01-2011.
1. Does AY here stand for Assessment Year? If so, does this mean that the demand is pertaining to the IT return of FY 2007-08?
2. To the best of my knowledge, I had paid taxes on all my income for 2007-08 and all years after that. How do I know what this amount is pertaining to? There are no details provided in the letter from CPC.
3. If this is indeed pertaining to AY 2008-09, why did this notice come to me after 3 years?
I am thoroughly confused. Can you please advise me on what I should do now?
Feeling relieved after seeing so many people receiving similar notifications. So what do we do now? Shall we simply ignore the letter or respond (Regd Post A/D) to the Assessment Office asking for detailed explanation? Can we also CC the response to some central office, like that of the Finance Minister?
Communication recd with Subject line "Communication on Arrear Demand" is in response to recent move by the CA fraternity against adjustment of very old demands agst refund due of Asst Yr 09-10 / 10-11.
Various associations had raised their voices agst such kind of wrong adj. by CPC without knowing genuineness / existance of such demands. CPC Authorities incl. Commr. (CPC) has replied in defence that they have provided training to the Jurisdictional ITOs to upload data relating to Old Outstanding Demands from their DC Register. ITOs have uploaded the data but without taking into account any pending rectification application & its processing. So CPC had no choice then to adjust said outstanding demands against refund dues eventhough wrong demands.
When any assessee receives Intimation u/s 143(1) as per which Refund receivable is adjusted against any old outstanding demand, pls check the records pertaining to that asst yr. to verify whether demand raised/adjusted is correct or not. As per Intimation if they say AY 2008 that means Demand adj pertains to Asst Yr. 2008-09 (i.e. yr end 31.03.2008).
If as per the record of the assessee demand is correct but said demand has already been paid then one can write letter for rectification to the Jursidictional ITOs (not to CPC, Banglore) & claim refund for that Asst Yr (i.e. for Asst Yr 2008-09).
In most cases, old demands relates to pending rectifications. In that case, give reminder to rectify & request refund of demand wrongly adjusted. Local Assessing Officer have issued refunds in many cases of the similar nature & they are bound to do it.
Communication recd from CPC with this subject line is just to clarify their stand as who will rectify the wrong adjustment of demand so that no confusion regarding procedure to be followed in such cases.