Compoundable Offences under Direct Tax Laws
- 15 Jun 2019
- 1 min read
The Central Board of Direct Taxes (CBDT) has issued the guidelines for compoundable offences under Direct Tax Laws, 2019.
- Compoundable offences are those which can be conciliated by the parties under dispute, without the requirement of the permission of the court.
Guidelines have classified offences into three categories.
- The first category of offences open to compounding include:
- Defaults under tax deducted or collected at source.
- Failure to file return.
- The second category of offences, for which compounding will not be allowed, deal with:
- Willful evasion of tax.
- Removal or concealment or transfer or delivery of property to thwart tax recovery in a search operation.
- The third category of offences that "shall normally not be compounded" includes:
- Offences committed by a person for which he was convicted by a court of law under direct tax laws.
- Enabling others to evade taxes.
- Money laundering (launder money by generating bogus invoices).
- Offences relating to undisclosed foreign bank account or assets under the Black Money (Undisclosed Foreign Income and Assets).
- Imposition of Tax Act, 2015 or under the Benami Transactions (Prohibition) Act, 1988.