tax department has sent
assessees, including start-ups, companies and individuals, who have
tax demands as well as
tax refunds asking them
to provide as update on the payment.
Since April 8, the Central Board of Direct Taxes (CBDT) has been fast-tracking refund payments
to help taxpayers in the COVID-19 pandemic situation and has till date issued nearly 14
lakh refunds involving an amount of
over Rs 9,000 crore
to various taxpayers including individuals, Hindu Undivided Families (HUFs), proprietors, firms, corporate, start-ups, and micro, small and medium enterprises (MSMEs).
The CBDT in a statement said its e-mail seeking clarification from all those who are entitled
tax refund but also have
to pay cannot be misconstrued as harassment.
“An opportunity is provided by the department
to the assessee
to either clear the demand or intimate the status of said demand
T department. Invariably, such communication is made by the department by sending an e-mail
to the assessee informing it of the quantum of
outstanding demand and providing an opportunity
to pay the demand or respond with evidence regarding payment of the same if already made, or update the status of any other action on it,” it said.
The CBDT said that the
assessees are required
to furnish details of the pending demand, whether it has been paid or has been stayed by any appellate/competent authority so that the department could keep the same in abeyance and do not deduct this amount from refund.
“Thus, following the existing procedure of recuperation of
outstanding demand, similar mails have also been sent
assessees including start-ups
T department, the status of the demand
outstanding and whether it has been stayed by the competent authority so that appropriate action can be taken for release of refunds without delay
to the start-up,” it added.
The CBDT said these
mails are part of the faceless communication and are auto-generated under Section 245 of the
T Act in refund cases where there is any
outstanding demand payable by the assessee. “In case the
outstanding demand has already been paid by the taxpayer or it has been stayed by the higher
tax authorities, the taxpayers are requested through these mails
to provide the status update so that while issuing the refund, these amounts are not held back and their refunds are released forthwith,” it said.
With reports in certain sections of social media, the CBDT said that such communications are just a request for seeking an update response from the assessee for the proposed adjustment of refund with the
outstanding demand and cannot be misconstrued as a notice of recovery or be perceived as so-called arm-twisting by the
T department because the department is duty bound
to protect public money by adjusting the
outstanding demand before releasing the refund.
“Many refunds are pending for the want of response from the taxpayers and will be issued at the earliest possible once the information is updated,” the CBDT added.