IT - Compounding of Offences - CBDT Guidelines
CBDT has issued guidelines on compounding of offences effective 1st of January 2015. Some salient features:
1. Any offence under chapter XXII of the Act may, either before or after the institution of proceedings, be compounded by the CCIT/DGIT.
2. Compounding of offences is not a matter of right. However, offences may be compounded by the competent authority on his satisfaction of the eligibility conditions.
3. Prosecution instituted under Indian Penal Code, if any, cannot be compounded as per these guidelines. However, section 321 of Criminal Procedure Code, 1973 provides for withdrawal of such prosecutions.
The following conditions should be satisfied for considering compounding of an offence:-
i. The person makes an application to the CCIT/DGIT having jurisdiction over the case for compounding of the offence(s) in the prescribed format
ii. The person has paid the outstanding tax, interest, penalty and any other sum due, relating to the offence for which compounding has been sought
iii. The person undertakes to pay the compounding charges including the compounding fee, the prosecution establishment expenses and the litigation expenses including counsel's fee, if any, determined and communicated by the CCIT/DGIT concerned.
iv. The person undertakes to withdraw appeal filed by him, if any, in case the same has a bearing on the offence sought to be compounded.
The application for compounding in the cases of co-accused shall be considered along with the main case or immediately after a decision has been taken in the main case.
CBDT Instruction in F.No. 285/35/2013 IT(Inv.V)/108., Dated: December 23, 2014