Lok Sabha Question No. 196 (UNSTARRED), answered on 2021-07-19
Subject: Tax Exemption on Covid-19 Treatment
Ministry: FINANCE
Asked by: C.N. Annadurai, Dhanush M Kumar, Gajanan Chandrakant Kirtikar, Gautham Sigamani Pon

- (a) Yes Sir.
- (b) Income-tax  exemption  shall  be  provided  to  the  amount  received  by  a  taxpayer  for  medical treatment from an employer or from any person for treatment of COVID-19 during financial year 2019-20 and subsequent years. The aim of this exemption is to provide relief to taxpayers who suffered on account of COVID-19 and had to incur sum for medical treatment of COVID19 after taking help from employer or any person. It is the stated policy of the Government to discourage cash transactions and move  towards less cash economy. Hence, there is no proposal to increase the limit of cash transactions permissible under various provisions of the Incometax Act, 1961.
- (c) Yes Sir, in order to provide relief to the family members of taxpayers who have lost their lives due to Covid-19, the Government has decided that income-tax exemption shall be provided to ex-gratia payment received by family members of a person from the employer of such person or from other person on the death of the person on account of Covid-19 during FY 2019-20 and subsequent years.

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED  QUESTION NO. 196

TO BE ANSWERED ON MONDAY 19 TH  JULY, 2021 ASHADHA 28, 1943 (SAKA)

## TAX EXEMPTION ON COVID-19 TREATMENT

196. SHRI C.N. ANNADURAI: SHRI DHANUSH M. KUMAR: SHRI GAJANAN KIRTIKAR: SHRI GAUTHAM SIGAMANI PON:

Will the Minister of FINANCE be pleased to state:

- (a) whether  the  Government  has  decided  to  provide  income  tax  exemption  to  the  amount received by a taxpayer for medical treatment from an employer or from any person for treatment of Covid-19 during the financial year 2019-20 and subsequent years;
- (b) if so, the details thereof along with the aims and objective behind this move;
- (c) whether  the  Government  has  also  decided  that  ex-gratia  received  by  family  members  of individuals who died due to Covid-19 will be exempt from income tax and if so, the details thereof and if there is any ceiling on the amount received;
- (d) whether  the  Government  has  also  extended  some  key  tax  compliance  deadlines  due  to impact of Covid-19 pandemic and if so, the details thereof; and
- (e) the success achieved by the Government after implementing Vivad se Viswas scheme?

## ANSWER

## THE MINISTER OF STATE IN MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

The exemption shall be allowed without any limit for the amount received from the employer and the exemption shall be limited to Rs. 10 lakh in aggregate for the amount received from any other persons.

- (d) Yes Sir , the Government has extended various key tax compliance deadlines due to impact of COVID-19 pandemic. The detail of these extended timelines is provided in the Annexure.
- (e) The government has resolved significant number of pending direct tax disputes amicably with the taxpayers under Vivad se  Vishwas Scheme, 2020. This was the primary objective of the Scheme as provided in the short title therein 'An Act to provide for resolution of tax and for matters connected therewith or incidental thereto'. The total number of pending tax disputes as on the eligibility date was 5,10,491. Total 1,32,353 declarations have been received under the  scheme,  entailing  disputed  tax  amounting  to  Rs  99,765  crore.  These  declarations relate  to  1,46,701  pending  disputes  (including  cross  appeals). Thus,  the  declarations received under the Scheme cover around 28.73% of pending tax disputes.
- ------

## 1. Extension of various key tax compliance under Direct Taxes:

The Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (hereinafter referred to as "TOLA") was enacted to ease the compliance requirement of taxpayers under  the  specified  Acts  mentioned  in  the  TOLA.  Further,  vide  various  notifications,  the  time period  of  compliance  was  further  extended.  Time  limit  has  also  been  extended  through  various circulars. The combined effect of TOLA and the said notifications/circulars are as under:

- (i) Various time limits for compliances and statutory actions under the taxation laws, other related  legislations  and  the  rules  or  notifications  prescribed/  issued  under  these  Acts were extended;
- (ii) Due  date  for  filing  of  ITR  for  Financial  Year  2019-20  (relevant  to  Assessment  Year 2020-21) was extended to 10th January, 2021 for non-auditable cases and non-company cases.  For  auditable  cases,  company  cases  and  cases  having  international  transactions, the due date was extended to 15th February, 2021. Due date for furnishing of tax audit report was also extended from 30th September, 2020 to 15th January, 2021.
- (iii) The  time  for filing income-tax  returns  for Financial Year  2018-19  (relevant  to Assessment Year 2019-20) was extended to 30th November, 2020;
- (iv) Date of assessments getting barred on 30th September, has been extended to 30th Sept 2021.
- (v) Extension  of  date  for  filing  declaration  under  the  Direct  Tax  Vivad  se  Vishwas  Act, 2020 [enacted for resolution of pending disputes related to the Act] was extended to 31 March 2021. Further, the due date of payment without any additional amount has been extended to 30th August 2021.
- (vi) The date for payment of self-assessment tax in case of taxpayers whose self-assessment tax liability is up to Rs. 1 Lakh was extended to 10th January,2021 (for non-auditable cases and non-company cases) and to 15th February, 2021 (for cases where tax audit is mandatory and company/international transaction cases).
- (vii) The date for making various investment/payment for claiming deduction under Chapter VIA-B of the Income-tax Act (hereinafter referred to as "the Act") was extended to 31st July, 2020.
- (viii) The  date  for  making  investment/construction/purchase/deduction  in  respect  of  capital gains under section 54 to 54GB of the Act for period between 20th March 2020 and 29th September was extended to 30th September, 2020.
- (ix) The date for commencement of operation for the SEZ units for claiming deduction under section 10AA of the Act was extended to 30th September, 2020 for the units which have received necessary approval by 31st March, 2020.
- (x) The  time  limit  for  furnishing  of  TDS/TCS  statements  and  issuance  of  TDS/TCS certificates in relation to FY 2019-20 was extended to 31st July, 2020 and 15th August, 2020 respectively.
- (xi) The  date  for  passing  of  order  or  issuance  of  notice  by  the  authorities  and  various compliances under various direct taxes and Benami Law was extended to 31st March, 2021.
- (xii) The date for linking of Aadhaar with PAN has been extended to 30th September, 2021.
- (xiii) Implementation  of  new  procedure  for  approval/  registration/  notification  of  certain entities  u/s  10(23C),  12AA,  35  and  80G  of  the  Act  was  deferred  from  01.06.2020  to 01.04.2021 and the last date of filing application has been extended to 31st August 2021.
- (xiv) Applicability of clause 30C and clause 44 in respect to reporting of GAAR compliance and GST in Form 3CD of the Income-tax Rules, 1962 (hereinafter referred to as "the Rules") has been extended till 31.03.2022.
- (xv) The time limit for filing appeal before the Commissioner (Appeals) under Chapter XX of the Act which was required to be filed by 01.04.2021 or thereafter was extended to 31.05.2021 or within the time provided under the relevant section, whichever is later.
- (xvi) The  time  limit  for  filing  objection  to  Dispute  Resolution  Panel  (DRP)  under  Section 144C of the Act, for which the last date of filing under that section was 1" April 2021 or thereafter,  was  extended  to  31st  May  2021  or  within  the  time  provided  under  that section, whichever is later.
- (xvii) The time limit for furnishing Income-tax return in response to notice under section 148 of the Act, for which the last date under the said notice is 01.04.2021 or thereafter, was extended to 31st May 2021 or within the time allowed under that notice, whichever is later.
- (xviii) The due date for furnishing belated/ revised returns for AY 2020-21 which was required to be furnished by 31.03.2021 under sub-section (4)/sub-section (5) of section 139 of the Act, was extended to 31.05.2021.
- (xix) The time limit for payment of TDS under section 194-IA (consideration for immovable property), section 194-IB (rental income)  and section 194M (payment to contractors) of the Act  and filing of challan-cum-statement for such tax deducted, which were required to be paid and furnished by 30.04.2021 under rule 30 of the Income-tax Rules, 1962 (the Rules) , was extended to 31st May 2021.
- (xx) The  time  limit  for  furnishing  statement  in  form  No.  61,  containing  particulars  of declarations  received  in  form  No.60  (person  not  having  PAN  who  enters  into  a transaction requiring  quoting  of  PAN),  which  was  required  to  be  furnished  by 30.04.2021 was extended to 31.05.2021.
- (xxi) The time limit for furnishing of Statement of Financial Transactions (SFT) for the FY 2020-21,  which  was  required  to  be  furnished  by  31.05  2021  under  rule  114E  of  the Rules and various notifications issued thereunder, was extended to 30.06.2021.
- (xxii) The time limit for furnishing  the Statement of Reportable Account for the calendar year 2020, which was required to be furnished by 31.05.2021 under rule 114G of the Rules, was extended to 30.06.2021.
- (xxiii) The TDS/TCS Book Adjustment Statement in form No 24G for the month of May 2021, which was required to be furnished by 15.06.20221 under rule 30 and rule 37CA of the Rules, was extended to 30.06.2021.
- (xxiv) The time limit for sending the statement of TDS from contributions paid by the trustees of an approved superannuation fund for the FY 2020-21, which was required to be sent by 31.05.2021 under rule 33 of the Rules, was extended to 30.06.2021.
- (xxv) The  due  date  of  furnishing  the  ITRs  for  the  Financial  Year  2020-21  (relevant  to  the Assessment Year 2021-22) which were required to be furnished under sub-section (1) of section 139 of the Act by:
-  31.07.2021 has been extended to 30.09.2021
-  31.10.2021 has been extended to 30.11.2021
-  30.11.2021 has been extended to 31.12.2021

Consequential relief also provided in payment of self-assessment tax by the extended date, if the amount payable is one lakh rupees or less.

- (xxvi) The  due  date  for  furnishing  belated/  revised  returns  for  the  Financial  Year  2020-21 (relevant  to  the  Assessment  Year  2021-22)  which  were  required  to  be  furnished  by 31.12.2021  under  sub-section  (4)/sub-section  (5)  of  section  139  of  the  Act,  has  been extended to 31.03.2022.
- (xxvii) The due date of furnishing of Report of Audit under  any provision of the Act for the Financial  Year  2020-21,  and  which  was  required  to  be  done  by  30.09.2021  has  been extended to 31.10.2021.
- (xxviii)The  due  date  of  furnishing  Report  from  an  Accountant  by  persons  entering  into international transaction or specified domestic transaction under section 92E of the Act for the Financial Year 2020-21, which was  required to be done by 31.10. 2021, has been extended to 30.11. 2021.
- (xxix) The time period for filing objections to DRP and Assessing Officer under section 144C of the Act,  the last date for which was 01.06.2021 or thereafter,  has been extended to 31.08.2021 or the date provided under the said section whichever is later.
- (xxx) The  time  limit  for  furnishing  the  TDS  Statement  for  the  last  quarter  of  the  Financial Year 2020-21, which was required to be furnished by 31.05.2021 under rule 31A of the Rules, was extended to 15.07.2021
- (xxxi) The time limit for furnishing the TDS certificate in form No.16 to the employee under rule 31 of the Rules which is required to be done by 15.06.2021, has been extended to 31.07.2021.
- (xxxii) The time limit for furnishing the statement of income paid or credited by an investment fund to its unit holder, in form No. 64D for the FY 2020-21, which was required to be furnished by 15.06.2021 under Rule 12CB of the Rules, was extended to 15.07.2021.
- (xxxiii)The time limit for furnishing the statement of income paid or credited by an investment fund  to  its  unit  holder  in  form  No.  64C  for  the  Financial  Year  2020-21,  which  was required to be furnished by 30.06.2021 under rule 12CB of the Rules, has been extended to 31.07.2021.
- (xxxiv) The date for compliances to be made by the taxpayers for investment, deposit, payment, acquisition,  purchase,  construction  etc  ,  for  the  purpose  of  claiming    exemption    on capital  gains  under section 54 to 54GB of the Act, for which the last date is between 01.04.2021 to 29.09.2021 (both days inclusive), has been extended to 30.09.2021.
- (xxxv) The time limit of furnishing the Quarterly Statement in form No. 15CC by authorized dealer in respect of remittances made for the quarter ending on 30.06.2021, which was required to be furnished by 15.07.2021 under rule 37 BB of the Rules, has been extended to 31st July, 2021.
- (xxxvi) The  time  limit  for  furnishing  the  Equalization  Levy  Statement  in  form  No.  1  for  the Financial Year 2020- 21, which was required to be filed on or before 30.06.2021, has been extended to 31.07.2021.
- (xxxvii) The time limit for furnishing the annual statement under sub-section (5) of section 9A of the Act by the eligible investment fund in form No. 3CEK for the Financial Year 2020-21,  which  was  required  to  be  filed  by  29.06.2021,  has  been  extended  to 31.07.2021.
- (xxxviii) The time limit for uploading of the declarations for non-deduction of TDS received from recipients in form No. 15G/15H  during the quarter ending 30.06.2021, which was required to be uploaded by 15.07.2021 has been extended to  31.08.2021.
- (xxxix) The time limit for exercising of option to withdraw pending application filed before the erstwhile Income Tax Settlement Commission under sub-section (1) of section 245M of the Act in form No. 34BB, which was required to be exercised by 27.06.2021 has been extended to 31.07.2021.
- (xl) Time Limit for passing penalty order has been extended to 30.09.2021.
- (xli) Time limit for issuance of notice under section 148 of the Act which was required to be issued by 31.03.2021 was extended to 30.06.2021.
- (xlii) Time limit for passing of orders by assessing officer consequent to receipt of directions from DRP which were required to be passed by 31.03.2021 was extended to 30.06.2021.
- (xliii) Time Limit for processing Equalisation Levy returns has been extended to 30.09.2021.
- (xliv) Time limit for passing or orders and issuance of notice by the Adjudicating Authority under the Prohibition of Benami Property Transaction Act, 1988 which was required to be passed/issued by 30.06.2021 has been extended to 30.09.2021.
- (xlv) Circular was issued to the effect that in case if a person has submitted valid Forms 15G and 15H to the banks or other institutions for FY 2019-20, then these form 15G and 15H will be valid up to June 30, 2020, for FY 2020-21 also.

## 2. Extension of various key tax compliance under indirect taxes:

## (I) Following measures have been taken in view of COVID-19 pandemic in the year 2020: -

- (i) In regard to composition scheme, -
- a) Due  date for  furnishing  FORM  GSTR-4  for  FY  2019-20  was  extended  till 31.10.2020.);
- b) Due date for payment of tax in FORM CMP-08 for last quarter of FY 2019-20 was extended till 07.07.2020;
- c) Composition scheme for FY 2020-21 could be opted till 30.06.2020.
- (ii) 10% cap on availment of Input Tax Credit in FORM GSTR-3B in terms of the provision of Rule 36(4) of CGST Rules, 2017 to be made applicable on cumulative basis for period of February to August, 2020 instead of on monthly basis.
- (iii) Conditional waiver of late fees for delayed furnishing of FORM GSTR-3B for the taxpayers if  return  furnished  till  the  specified  dates  for  the  tax  periods  Feb  2020  to  April  2020  for taxpayers with turnover of more than 5 crores (Feb 2020 to July 2020- for taxpayers with turnover up to 5 crores).
- (iv) Further, the amount of late fee payable has been capped at Rs. 500/- for each return for the tax  period  from  February,  2020  to  July,  2020,  if  such  returns  are  furnished  by  30 th September, 2020. The late fee is NIL if the tax liability is zero.
- (v) Measures related to Interest on delayed payment of tax:
- (a) For  taxpayers  with  turnover  above  Rs.  5  crores  in  the  preceding  FY,  for  FORM GSTR-3B  for  the  months  from  February,  2020  to  April,  2020,  there  would  be  no interest for first fifteen days after the due date and thereafter at 9% p.a. till 24.06.2020.
- (b) For  taxpayers  with  turnover  of  up  to  Rs.  5  crores  in  the  preceding  FY,  for  FORM GSTR-3B  for  the  months  from  February,  2020  to  July,  2020,  there  would  be  no interest till specified dates and thereafter at 9% p.a. till 30.09.2020.
- (vi) Late fees for FORM GSTR-1 were waived for tax periods March 2020 to June 2020 and Quarter Jan to Mar 2020 and Apr to Jun 2020, if such statement is furnished by specified dates.

(vii) Extension of due date for FORM GSTR-3B :

- (a) For month of May, 2020 to specified date for all taxpayers.
- (b) For month of August, 2020 for taxpayers having turnover of up to Rs. 5 crores.
- (viii) An  enabling  section  168A  was  inserted  in  the  CGST  Act,  2017  to  empower  the government to extend the due date in case of force-majeure event. Notifications have been issued  using  the  said  power,  to  extend  the  due  date  for  compliance  for  almost  all  the provisions of Act. For almost all the provisions of Act, any time limit for completion or compliance of any action, by any authority or by any person, under the CGST Act, which falls  during  the  period  from  the  20.03.2020  to  the  30.08.2020,  was  extended  up  to  the 31.08.2020.
- (ix) Validity  of  e-way  bills  was  extended  till  30.04.2020  for  those  expiring  between  period 20.03.2020 to 15.04.2020. Further, validity of e-way bills was extended till 30.06.2020 for those expiring on or after 20.03.2020 and generated on or before 24.03.2020. Provision for blocking  of  e-way  bill  for  non-filing  of  two  or  more  GSTR-3B  was  suspended  from 20.03.2020 to 15.10.2020.
- (x) Time limit for completion or compliance of any action in respect of goods being sent or taken out of India on approval for sale or return for which such compliance falls during the period from the 20.03.2020 to the 30.10.2020 was extended till 31.10.2020.
- (xi) Time limit for completion or compliance of any action in respect of Section 171 (NAPA provisions) for which such compliance falls during the period from the 20.03.2020 to the 30.03.2021 was extended till 31.03.2021.
- (xii) The facility of verifying returns (FORM GSTR-3B) through Electronic Verification Code , instead  of  Digital  Signature  Certificate,  was  provided  during  the  period  21.04.2020  to 30.09.2020 in respect of the companies registered under Companies Act, 2013. Similarly, they could file the statement of outward supplies (FORM GSTR-1) during the period from the 27.05.2020 to 30.09.2020 verified through electronic verification code (EVC).

## (II)  Following  measures  have  been  taken  in  view  of  the  outbreak  of  the  second  wave  of COVID-19 pandemic in the year 2021: -

- (i) Concessional rates of interest in lieu of the normal rate of interest of 18% per annum for delayed tax payments have been prescribed as follows:
- a. For registered persons having aggregate turnover above Rs. 5 Crore: A lower rate of interest of 9 per cent for the first 15 days from the due date of payment of tax and 18 per cent thereafter, for the tax payable for tax periods March 2021, April 2021 and May 2021 payable in April 2021, May 2021 and June 2021 respectively, has been notified.
- b. For registered persons having aggregate turnover upto Rs. 5 Crore (for both normal taxpayers and those under QRMP scheme) :
- i. Nil rate of interest for the first 15 days from the due date of payment of tax, 9  per  cent  for  the  next  45  days,  and  18  per  cent  thereafter,  for  the  tax payable for the period March 2021 has been notified.
- ii. Nil rate of interest for the first 15 days from the due date of payment of tax, 9  per  cent  for  the  next  30  days,  and  18  per  cent  thereafter,  for  the  tax payable for the period April 2021 has been notified.
- iii. Nil rate of interest for the first 15 days from the due date of payment of tax, 9  per  cent  for  the  next  15  days,  and  18  per  cent  thereafter,  for  the  tax payable for the period May 2021 has been notified.
- c. For registered persons  who have opted to pay tax under the  Composition scheme: NIL rate of interest for first 15 days from the due date of payment of tax and 9 per cent  for  the  next  45  days  thereafter  has  been  notified  for  the  tax  payable  for  the quarter ending 31 st March, 2021.
- (ii) Waiver of late fee for specified period after due date for the returns has been provided as follows:
- a. For registered persons having aggregate turnover above Rs.  5 Crore: Late fee  waived for 15  days in  respect  of returns  in  FORM  GSTR-3B furnished beyond the due date for tax periods March, 2021, April, 2021 and May 2021, due in the April 2021, May 2021 and June 2021 respectively;
- b. For registered persons having aggregate turnover upto Rs. 5 Crore:
- i. Late fee waived for 60 days in respect of the returns in FORM GSTR-3B furnished beyond  the  due  date  for  tax  periods  March,  2021  (for  taxpayers  filing  monthly returns) due in April 2021.
- ii. Late fee waived for 45 days in respect of the returns in FORM GSTR-3B furnished beyond the due date for tax period April, 2021 (for taxpayers filing monthly returns) due in May 2021.
- iii. Late fee waived for 30 days in respect of the returns in FORM GSTR-3B furnished beyond the due date for tax period May, 2021 (for taxpayers filing monthly returns) due in June, 2021.
- c. For registered persons filing FORM GSTR-3B on quarterly basis , Late fee waived for 60 days beyond the due date for period Jan-March, 2021.

(iii)Extension of due date of filing GSTR-1, IFF, GSTR-4 and ITC-04:

- a. Due date of filing FORM GSTR-1 and IFF for the month of April 2021 and May 2021 has been extended by 15 days.
- b. Due date of filing FORM GSTR-4 for FY 2020-21 has been extended from 30 th  April, 2021 to 31 st July, 2021 .
- c. Due date of furnishing FORM ITC-04 for Jan-March, 2021 quarter has been extended from 25 th April, 2021 to 30 th June, 2021.
4. (iv) 5% cap on availment of Input Tax Credit in FORM GSTR-3B in terms of the provision of Rule 36(4) of CGST Rules, 2017 to be made applicable on cumulative basis for period of April, May and June, 2021 in the return for tax period June, 2021 or the quarter ending in June, 2021.
5. (v) The filing of GSTR-3B and GSTR-1/ IFF by companies using electronic verification code has been enabled for the period from the 27.04.2021 to 31.08.2021.
6. (vi) Extension  in  statutory  time  limits  under  section  168A  of  the  CGST  Act: Time  limit  for completion of various actions, by any authority or by any person, under the GST Act, which falls during the period from 15 th April, 2021 to 29 th June, 2021, has been extended up to 30 th June, 2021, subject to some exceptions as specified in the notification.

***************