Compounding of Offences - CBDT Issues Guidelines - No Compounding for Foreign Black Money
SECTION 279(2) of the Income Tax Act provides that any offence under chapter XXII of the Act may, either before or after the institution of proceedings, be compounded by the CCIT/DGIT. The CBDT vide letter in F.No. (Inv.V)/108 , dated 23.12.2014 issued detailed guidelines on compounding of offences.
Now, a doubt has been expressed whether offences relating to undisclosed foreign bank accounts/assets could be compounded as per the guidelines of the Board dated 23.12.2014.
Board has consulted with the Special Investigation Team (SIT) and clarifies:
(i) Such cases can be compounded only after filing the Prosecution complaint(s) and shall not be compounded at the stage of show cause notice and/or without filing the complaint in the court.
(ii) The cases in which the assessee has not admitted the foreign bank account(s)/assets and/or has not cooperated with the Department in the assessment, penalty & recovery proceedings shall not be compounded.
(iii) The cases in which the assessee has admitted accounts/assets either fully (all accounts with which he is associated) or partially (only a few accounts out of all accounts with which he is associated), paid taxes and penalty and cooperated with the Department may be considered for compounding as per the guidelines dated 23.12.2014, only after filing the complaints.
Board has specifically clarified that there is no provision for compounding of offences under the newly enacted Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015. Consequently, the above clarifications will not apply to cases coming under the purview of this Act.
CBDT Letter in F.No. 285/90/2013 IT(Inv.V)/212., Dated September 04, 2015