Tag Archives: CBDT

CBDT’s message to the Businesman: Go Digital; Take a ‘clean’ break from the past

Supplementing the Government’s efforts in promoting a ‘Digital’ economy, the CBDT has issued a Circular [No.40 of 2016] clarifying that businesses need not be worried about impact of ‘increased turnover’ as a result of accepting digital payments, virtually assuring them that such a Turnover spike would not trigger scrutiny of past years’ Tax filing.

In a rather interestingly worded Circular, the Apex administrative body of Tax Department notes:

“By adopting digital mode of payment, no financial transactions would remain undisclosed and consequently an enhanced turnover of business might get reflected in the books of account.”

The Circular goes on to allay apprehensions that increased turnover in the current year on account of digital payments would not lead to reopening of earlier years’ cases  by the Assessing officer. Mere increase in turnover because of use of digital means of payment or otherwise cannot be a “reason to believe” that income has escaped assessment; the Circular clarifies.

Our Comment:

The Circular is welcome inasmuch as it clarifies that increased turnover on account of digital means of payment being introduced would not lead to past scrutiny. The language employed in the Circular however is prone to being interpreted as providing this assurance to Businesses which have not been accounting their sales properly:

“Take a clean break from the past, bring the cash component of your Business into formal mode by accepting digital payments, don’t worry about its consequences on the past devious behavior – we’ll let bygones be”

The move is a pragmatic one no doubt. Morally correct? why waste our thinking faculties debating this- lets just call it one more amnesty!

CBDT cracks the whip on Tax officials “to adhere to schedule of appointments with Taxpayers”

One of the reasons Taxpayer’s dread that visit to Tax office is the inordinate ‘waiting time’ to meet the Tax officials – quite often, the wait being more than at Doctors clinic!

The CBDT has now issued a Office Memorandum (OM) to its officers not to schedule multiple appointments at the same date/time and to respect the  Citizen’s charter which, amongst other things, endeavors to “adhere to the schedule of appointments with the Taxpayers”.

In a sternly worded message, the OM says that such actions cause “great embarrassment to the Government” and ends with the warning that “Instances of disregard to these instructions may be viewed seriously”.

So, the next time you receive a notice to appear at an appointed time, you’d better be on time – who knows, the Tax officer may actually be waiting for you!