CBDT issues Guidelines on Waiver of Interest in case of TDS Default [Read Circular]

CBDT - Guidelines - TDS - Taxscan

The Central Board of Direct Taxes (CBDT) on Friday issued a circular saying that the tax department will waive interest liability if the principal demand of capital gains tax is paid by companies. The circular specifies waiver of interest in disputed tax demand in different scenarios.

“However, no reduction or waiver of such interest shall be ordered unless the principal demand… stands fully paid or satisfactory arrangements for payment of the principal demand have been made,” CBDT guidelines to Chief Commissioner of Income Tax and Director General of Income Tax said.

The guidelines came seven weeks after the Direct Tax Dispute Resolution Scheme, announced by Finance Minister Arun Jaitley on February 28 last year, closed.

The scheme, which closed on January 31, provided for waiver of interest and penalty if the principal amount involved in retrospective tax cases is paid and all appeals against the government challenging constitutional validity of back-dated amendment to Income Tax laws are withdrawn.

Read the full text of the Circular below.

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