IT - Adjustment of refunds only after assessment - CBDT Clarifies
THE Directorate of Income Tax Systems clarifies that as per a recent judgement of the Delhi High Court, the department is required to follow the procedure prescribed under Sec 245 of the Income Tax Act before making any adjustment of the refund payable by CPC, Bangalore. Therefore the assessee must be given an opportunity to file response or reply which should be considered by the AO before directing any adjustment. The AO should communicate his findings to CPC Bangalore which will adjust the demand if any.
The Directorate wants the Chief Commissioners to issue necessary instructions to the Assessing Officers.