No Compulsory Scrutiny when Income Tax Return Furnished u/ s 142(1) based on Departmental Information: CBDT issues Guidelines [Read Circular]

The Central Board Of Direct Taxes (CBDT), ITA –II division, Dept. of Revenue, Ministry Of Finance, New Delhi, has recently issued guidelines clarifying that when a return has been furnished in response to a notice u/s 142(1) of the Act, where such notice was issued due to the information contained in NMS Cycle/ SFT information or information received from the Directorate Of I &CI, the such return will not be taken up for compulsory scrutiny but instead that the scrutiny for the same will be done through CASS cycle.

The guidelines further read that in case of compulsory scrutiny, the same shall be done by the International Taxation and Central Circle Charges, following the prescribed parameters and procedures as mentioned in the guidelines, with prior administrative approval of the Pr. CIT/ Pr. DIT/CIT/DIT concerned, and that the same shall, as earlier, continue to be handled by these charges.

In addition to this, it was also mentioned in the guidelines that in accordance with the amendments brought by the Finance Act, 2021, reducing the time limit for service of notice u/s 143(2) to three months from the end of the financial year in which the return is filed, the selection and transfer of cases involving the completion of the assessment in a faceless manner, to NaFAC, shall also to completed positively by 31^. 05. 2022.

Also, the guidelines further stated that with regard to the cases selected for compulsory scrutiny, the service of notice u/s 143(2) of the act shall be completed by 30.6.2022.

To Read the full text of the Circular CLICK HERE

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