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With the Income-Tax Settlement Commission ceasing operations from February 1, the Central Board of Direct Taxes (CBDT) on Tuesday announced it will provide an opportunity for eligible income taxpayers to file application for settlement up to September 30.
“In order to provide relief to the taxpayers who were eligible to file application as on January 31, 2021, but could not file the same due to cessation of ITSC vide Finance Act, 2021, it has been decided that applications for settlement can be filed by the taxpayers by September 30, 2021, before the Interim Board,” CBDT said in a statement.
Conditions for filing application before interim board prescribe the assessee eligible to file application for settlement on January 31, and all the relevant assessment proceedings are pending as on the date of filing the application for settlement. It clarified that taxpayers who have filed such applications will not have the option to withdraw. Further, the taxpayers who have already filed application for settlement on or after February 1, as per the direction of the various High Courts and who are otherwise eligible to file such application will not be required to act again.
Interim Board
In order to dispose of the pending settlement applications as on January 31, the Central government had constituted Interim Board for Settlement on August 10. The taxpayers, in the pending cases, have the option to withdraw their applications within the specified time and intimate the Assessing Officer about such withdrawal.
Many taxpayers represented that they were in advanced stages of filing their application for settlement before the ITSC as on February 1. Further, some taxpayers have approached High Courts requesting that their applications for settlement may be accepted. In some cases, High Courts have given interim relief and directed acceptance of applications of settlement even after February 1. “This has resulted in uncertainty and protracted litigation,” the board said and accordingly new mechanism has been announced.
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