Income Tax - No Demand less than Rs. 100
IT has been reported in some sections of the press that the Central Processing Centre, Bangalore is sending notices for payment of taxes which are as small as Rs. 1/-, 4/-, 6/-, causing unnecessary hardship to assesses.
The Income Tax Department clarifies that it had created a central repository of all demands for better demand management. To achieve this, all officers were asked to collate demand lying at various places viz. IRLA, TMS and manual registers and upload onto CPC portal. This was also part of the annual action plan. Consequently, AOs have uploaded the same. During a meeting with Bangalore Chartered Accountants association, it was suggested that taxpayers should also be informed about the same so as to enable them to take necessary action if the outstanding demands were incorrect. This measure was aimed at providing greater transparency. Therefore, a communication has been sent to taxpayers informing them about existing arrears.
It is clarified that this communication is not a demand notice. This measure is, in fact, an assessee-friendly exercise. The Department has also written to all chief commissioners to amend such entries, if found incorrect, when approached by taxpayers. This would correct the database if a taxpayer has proof of payment etc.
As per the extant procedure, demand of less than Rs. 100 is not enforced but is liable for adjustment against future refunds.