Corrigendum to Order under section 119 of the Income-tax Act, 1961 for exercising power of intrusive or coercive action for recovery of tax demand by Assessing Officers or Tax Recovery Officers

Last updated: 20 October 2020

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This document is a corrigendum, meaning it corrects a previous order issued by the Central Board of Direct Taxes (CBDT) regarding intrusive or coercive actions for tax recovery. The correction clarifies that references in paragraph 2 of the original order should be to 'Para I' instead of 'sub-para A & B'. The updated order reiterates that Assessing Officers (AOs) and Tax Recovery Officers (TROs) must follow existing procedures for property attachment, obtain prior approval from the relevant Principal Commissioner or Director, and adhere to specific guidelines for recovery surveys.

F.No.275/29/2020-IT(B)
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
North Block, New Delhi
********

Dated 19th October, 2020

Corrigendum to Order under section 119 of the Income-tax Act, 1961

Subject: Order under section 119 of the Income-tax Act, 1961 for exercising power of intrusive or coercive action for recovery of tax demand by Assessing Officers or Tax Recovery Officers-reg.

With respect to CBDT’s Order under section 119 of the Income-tax Act, 1961, dated 16 October, 2020 on the above-mentioned subject. In the second sentence of Para 2 of the Order, the reference was made to sub-para A & B inadvertently which correctly should have been Para I, therefore, I am directed to state that Para 2 is modified and may be read as below:

“2. With respect to the attachment of movable or immovable property, the extant procedure in the Income-tax Act, Rules, Manuals and guidelines may be followed. TROs should strictly fallow provisions of the Second Schedule of the Income-tax Act, 190 subject to above guidelines mentioned in Para 1 above. Before attachment of movable and immovable property. the AO or TRO shall rake prior approval of Pr, CIT/Pr. DIT/CIT/DIT concerned.”

3. The modified Order after above corrigendum is enclosed herewith and it comes into effect immediately.

4. The Hindi version shall follow.

(Mahesh Kumar)
Director (IT-Budget), CBDT
Tele: 23092641
E Mail: dirbud-cbdt@nic.in

—-

F.No.275/29/2020-IT(B)
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
North Block, New Delhi
********

Dated 19 October, 2020

Order

Subject: Order under section 119 of the Income-tax Act, 1961 for exercising power of intrusive or coercive action for recovery of tax demand by Assessing Officers or Tax Recovery Officers-reg‑

In pursuance of Board’s letter F.No. 275/29/2020-(IT(B) dated 21st September. 2020 wherein at Para 2(ii) it was stated that with respect to any coercive action like attachment or intrusive action like recovery survey etc. by the Assessing Officers (AOs) or Tax Recovery Officers (TROs), separate guidelines arc being issued and in further pursuance of "The Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020", prescribing the “income-tax Authority” for the purpose of power of survey u/s 133A of the Act, the Central Board of Direct Taxes, in exercise of powers under section 119 of the act, hereby directs that‑

1. Any Assessing Officer (AO) or Tax Recovery Officer (TRO), who are authorised under the Income-tax Act, 1961 to carry out the functions related to recovery of arrears or current tax demand, may carry out these functions as per Provisions of Chapter X VII and the Second Schedule of the Income -tax Act, Income Tax Rides, Manuals and Guidelines issued earlier in this regard. However, while taking intrusive and coercive action for recovery of taxes following guidelines should be kept in mind:

(i) Any coercive or intrusive action for recovery of tax demands should be taken only after exhausting alternative means of recovery as mentioned in Para 2((i) of Board’s letter F.No. 275/29/2020-(MB) dated 21 September, 2020.

(ii) Recovery surveys should he resorted to only in cases where the taxpayer/ defaulter is not responding to the notices or notices are not getting served or recovery of taxes is not taking place even after going through the “Profile View” and “Asset Details” in Project Insight.

(iii) It may be noted that as per amended section 133A, the surveys can be conducted only by officers of Investigation or TDS Wing.

(iv) All recovery surveys of the charges other titan Central charges will he conducted by the officers of IDS charge. The recovery survey will be approved by a Collegium. The Collegium will consist of two officers of the level of Pr, CCIT or CM, which will include the CCIT of the concerned jurisdictional charge and CCIT (TDS) or Pr. CCIT of the region where there is CCIT(TDS). In case of International Taxation charges, the Collegium will include Pr. CCIT (International Taxation) / CCIT (International Taxation) as one of the members and CCIT (TDS) or Pr. CIT of the region where there is no CCIT (TDS) as the second member.

(v) There will be no Collegium for IDS charges. MS charges will conduct recovery surveys in their cases after the approval of cm(ms) or where there is no CCIT (TDS) after the approval of Pr. CCIT of the region.

(vi) Recovery surveys of Central charges under jurisdiction of CCIT (Central) will be conducted by the officers of Investigation Wine after taking approval of a Collegium consisting of CCIT(Central) concerned and DGIT (Investigation). Where Central charges are under jurisdiction of DGIT (Investigation), recovery surveys will be conducted after taking approval of DGIT (Investigation) only.

(vii) In the event of any disagreement between the officers in the Collegium, the issue would be resolved by the Pr. COT of the region.

(viii) Officers of TDS or Investigation Wing will involve AO or TRO concerned and the survey will be conducted as per the established survey procedures.

(ix) The Pr. CIT/CIT/Pr. DIT/DIT of the Investigation or TDS Wing should monitor and ensure that the survey does not go beyond the scope as approved by the Collegium CCIT (TDS)/DGIT (Investigation), as the case may be.

(x) TDS or Investigation Wing officer shall prepare the survey report and upload the same on ITBA as per Survey Manual and extant instructions in this regard and will also send a copy of survey report to AO/TRO concerned.

2. With respect to the attachment of movable or immovable property. the extant procedure in the Income-tax Act, Rules, Manuals and guidelines may be followed. TROs should strictly follow provisions of the Second Schedule of the Income-tax Act, 1961 subject to above guidelines mentioned in Para I above. Before attachment of movable and immovable property, the AO or TRO shall take prior approval of Pr. CIT/Pr. DIT/CIT/DIT concerned.

3. This order comes into effect immediately.

4. The Hindi version of the order shall follow.

(Mahesh Kumar)
Director (IT-Budget), CBDT
Tele: 23092641
E Mail: dirbud-cbdt@nic.in

FAQ :

This corrigendum corrects a previous order by the CBDT concerning intrusive or coercive actions for tax recovery. It clarifies specific references within the original order.

The order covers intrusive or coercive actions for the recovery of tax demand by Assessing Officers (AOs) or Tax Recovery Officers (TROs), including property attachment and recovery surveys.

Before attaching any movable or immovable property, the AO or TRO must obtain prior approval from the concerned Pr. CIT/Pr. DIT/CIT/DIT.

Recovery surveys can be conducted by officers of the Investigation or TDS Wing, subject to specific approval processes and guidelines outlined in the order, depending on the jurisdiction.

Recovery surveys should only be used when taxpayers are not responding to notices, notices are not being served, or tax recovery is not occurring despite reviewing taxpayer information in Project Insight.

Yes, the modified order, after the corrigendum, comes into effect immediately.