Lok Sabha Question No. 2889 (UNSTARRED), answered on 2018-08-03
Subject: Income Tax Notices
Ministry: FINANCE
Asked by: MURALI MOHAN MAGANTI

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED QUESTION NO. 2889

## TO BE ANSWERED ON FRIDAY THE 3rd AUGUST, 2018 12 SHRAVANA, 1940 (SAKA)

## "INCOME TAX NOTICES"

## 2889: SHRI M. MURALI MOHAN:

Will the Minister of FINANCE be pleased to State:

- (a) Whether the Government is aware that the Income Tax Department officials of IT Department have sent notices for individuals small, medium and large scale enterprises, Government employees for the old cases of more than six/seven years and harassing them, if the details thereof; SO,
- (b) Whether any proper mechanism is in place to settle the cases by giving opportunity for one-time settlement and if So,the details thereof; put
- (c) Whether any instructions have been issued to the IT Department to open special counters to settle their cases by imposing minor penalties and prevent their harassment; and
- (d) If so,the details thereof?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE: (SHRI SHIV PRATAP SHUKLA)

- (a) Under the provisions of Income-tax Act, 1961 ('Act'), notices for assessment/reassessment of income of old cases of more than six years from the end of the relevant assessment year can be issued only in the following exceptional situations:
- (i) Under clause (c) of sub-section (1) of section 149 of the Act; in cases where income in relation to any asset  (including financial interest in any  entity) located outside India, chargeable to tax, has escaped assessment; such cases can be reopened up to sixteen years from end of the relevant assessment Information regarding number of cases in which notices were issued under the said   provision six years from the end of the relevant assessment year; as provided by the Directorate of System, is as under:year:
- (ii) In cases where tangible evidences are found during a search or seizure operation revealing that income exceeding rupees lakh has escaped assessment, then assessment can be framed for an assessment year falling between the seventh upto the tenth assessment year: This provision was introduced vide Finance Act; 2017 and where search under section 132 of the Act is initiated or requisition under section 132A4 of the Act is made on or after 1st April, 2017. fifty applies

| During Financial Years   |   No. of cases in which notices were issued beyond six years |
|--------------------------|--------------------------------------------------------------|
| 2014-15                  |                                                           82 |
| 2015-16                  |                                                           17 |
| 2016-17                  |                                                            5 |
| 2017-18                  |                                                            7 |

Further, Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act; 2015, which taxes the undisclosed foreign income and assets of earlier years in the year of issuing notice has been made applicable from 1st April, 2016.

If any specific instance of causing undue harassment to the assessee while invoking the above provisions is detected,the same is dealt with strictly by the Department

(b) The Act contains a specific chapter XIX-A consisting of section 245A to 245M, inserted by this regard, Settlement Commission which is a quasi-judicial body, was set up under section 245B of the Act The objective of setting up of Settlement Commission is to settle tax liabilities in complicated cases avoiding endless and prolonged   litigation and   consequential strain on investigational resources of Income-tax Department, subject to fulfilment of conditions prescribed therein:

Further; in recent years, Government had introduced following laws/schemes to deal with undisclosed income/asset:

- (i) A one-time compliance window between the period 1st July, 2015 to 30th September, 2015, for disclosing any undeclared foreign asset acquired from income chargeable to tax under Income tax Act for any assessment year to 2016-17 was provided; prior
- (ii) The Income Declaration Scheme, 2016 provided an opportunity to any person to make a declaration between the period Ist June, 2016 to 30th September; 2016,in respect of any income chargeable to tax under the Income tax Act for any assessment year to 2017-18; prior
- (iii) Under Pradhan Mantri Garib Kalyan Yojana, 2016, between 17th December; 2016 till 31st March, 2016,a declarant could make a declaration in respect of any income, in the form of cash or deposit in an account maintained by the person with a specified entity, chargeable to tax under the Income tax Act for any assessment year to 2017-18 prior
- (iv) Section 270AA ofthe Act, inserted by the Finance Act; 2016 W.e.f. 1st April, 2017, provides immunity from penalty under section 270A and initiation of prosecution proceedings under section 276C or 276CC,subject to fulfilment of conditions prescribed therein:
- (c) No such instruction has been issued.
- (d) Does not arise in view of reply at para (c):