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{"id":1443,"date":"2015-05-18T00:00:00","date_gmt":"2015-05-17T18:30:00","guid":{"rendered":""},"modified":"2015-12-29T16:11:05","modified_gmt":"2015-12-29T10:41:05","slug":"procedure-for-response-to-arrear-demand-by-taxpayer-and-verification-and-correction-of-demand-by-aos","status":"publish","type":"post","link":"https:\/\/taxclick.org\/type\/income-tax\/procedure-for-response-to-arrear-demand-by-taxpayer-and-verification-and-correction-of-demand-by-aos\/","title":{"rendered":"Procedure for Response to Arrear Demand By Taxpayer And Verification and Correction of Demand by AOs"},"content":{"rendered":"

Government of India
\nMinistry of Finance
\nDepartment of Revenue
\n<\/strong>Central Board of Direct Taxes <\/strong>North-Block,
\nI TA-11, Division New Delhi the 14. 05. 2015<\/strong><\/p>\n


<\/strong><\/p>\n

Subject:      Procedure for Response to Arrear Demand By Taxpayer And Verification and Correction of Demand by AOs – regarding <\/p>\n

The CBDT vide Instruction No,4 of 2014 dated `T” <\/em>April, 2014, inter-aila, prescribed Standard Operating Procedure for Verification and Correction of Demand available or uploaded by AOs in CPC Demand Portal. Further a
\nfacility has been made available to taxpayers on the E-filing website (www.incometaxindiaefiling.gov.in<\/a>) to<\/strong>provide online responses to such demands. The actions required to be
\nperformed by the taxpayer and<\/strong>the AO
\nare being consolidated in this circular as
\nunder:<\/p>\n

2.                 Action To Be Performed By Taxpayer<\/strong><\/p>\n

i.                 
\nLogin to
\ne-Filing website with User ID, Password, Date of Birth \/Date of Incorporation and Captcha.<\/p>\n

ii.                
\nGo to E-file
\nmenu <\/strong>and click on
\n“Response to Outstanding Tax Demand”    <\/p>\n

iii.              
\nFollowing
\ndetails would be displayed.<\/p>\n

o    Assessment
\nYear<\/p>\n

o  
\nSection
\nCode<\/p>\n

o   
\nDemand
\nIdentification Number (DIN)<\/p>\n

o   
\nDate on
\nwhich demand is raised<\/p>\n

o  
\nOutstanding
\ndemand amount<\/p>\n

o   
\nUploaded
\nBy<\/p>\n

o   
\nRectification
\nRights<\/p>\n

o    Response- Submit and View<\/em><\/p>\n

 <\/em>iv.    Taxpayer must click on \u201cSubmit\u201d link under
\nResponse column for the respective AY in order to submit the response. Taxpayer has to select one of the options<\/p>\n

from the radio button.<\/p>\n

o    
\nDemand <\/strong>is correct<\/strong><\/p>\n

o    
\nDemand <\/strong>is partially correct<\/strong><\/p>\n

o    
\nDisagree with demand<\/strong><\/p>\n

v, If taxpayer selects “Demand is correct”, then a pop up is
\ndisplayed as “If you<\/p>\n

confirm  “Demand <\/strong>is correct’ then you cannot ‘Disagree with
\nthe demand’.  Click on “Submit”.
\n<\/strong>A <\/strong>success message is displayed.<\/p>\n

o   if any refund is due, the outstanding demand along with interest will be adjusted against the refund due.<\/p>\n

o   In any other case taxpayer has <\/strong>to immediately pay the demand.<\/p>\n

vi.          
\nIf
\ntaxpayer selects “Demand is partially correct”, then “Amount
\nwhich is correct” and
\n“Amount which is incorrect” has to entered.<\/p>\n

vii.        
\nIf
\ntaxpayer selects ‘amount which is incorrect’ then he should mandatorily fill one or more reasons for stating so as listed below:<\/p>\n

 <\/p>\n

 o  
\nDemand has been already Paid-<\/p>\n

o  
\nDemand paid and Challan has CIN (Challan
\nIdentification Number)<\/p>\n

o Demand paid and Challan has no CIN<\/p>\n

o  
\nDemand has already been reduced by
\nrectification\/ revision<\/p>\n

o  
\nDemand has already been reduced by Appellate
\nOrder but appeal effect has to be given by Department<\/p>\n

o  
\nAppeal has been filed and<\/p>\n

o  
\nStay petition has been filed with<\/p>\n

o  
\nStay has been granted by<\/p>\n

o  
\nInstallment has been granted by<\/p>\n

o  
\nRectification\/ Revised Return has been filed at
\nCPC<\/p>\n

o  
\nRectification has been filed with Assessing Officer<\/p>\n

o  
\nOthers<\/p>\n

viii.    Based on the
\nreasons selected, the taxpayer needs to provide additional information as
\nper  the table given below.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n
\n

Reason Selected<\/strong><\/p>\n<\/td>\n

\n

Additional Details Required<\/strong><\/p>\n<\/td>\n<\/tr>\n

\n

Demand paid and Challan has CIN<\/p>\n<\/td>\n

\n

BSR Code<\/p>\n

Date of payment<\/p>\n

Serial Number of Challan<\/p>\n

Amount<\/p>\n

Remarks (any comments of taxpayer can be included)<\/p>\n<\/td>\n<\/tr>\n

\n

Demand paid and Challan has no CIN<\/p>\n<\/td>\n

\n

Date of Payment<\/p>\n

Amount<\/p>\n

Remarks (any comments of taxpayer can be included)<\/p>\n

Upload copy of Challan<\/p>\n<\/td>\n<\/tr>\n

\n

Demand already reduced by rectification\/ revision<\/p>\n

 <\/p>\n<\/td>\n

\n

Date of order<\/p>\n

Demand after rectification\/ revision<\/p>\n

Details of AO who has rectified or revised<\/p>\n

Upload Rectification\/ Giving appeal effect order passed by
\n AO<\/p>\n<\/td>\n<\/tr>\n

\n

Demand already reduced by Appellate Order but appeal
\n effect to be given<\/p>\n

 <\/p>\n<\/td>\n

\n

Date of order<\/p>\n

Appellate order passed by (details of CIT (A) etc)<\/p>\n

Stay petition filed with (details of office etc)<\/p>\n<\/td>\n<\/tr>\n

\n

Appeal has been filed: Stay has been granted <\/p>\n<\/td>\n

\n

Date of filing Appeal<\/p>\n

Appeal pending with<\/p>\n

Stay granted by<\/p>\n

Upload copy of Stay Order<\/p>\n<\/td>\n<\/tr>\n

\n

Appeal has been filed : installment has been granted <\/p>\n<\/td>\n

\n

Date of filing Appeal<\/p>\n

Appeal pending with (details of CIT (A) etc)<\/p>\n

Installment granted by (details of office etc)<\/p>\n

Upload copy of stay\/ installment order<\/p>\n<\/td>\n<\/tr>\n

\n

Rectification\/ Revised Return filed at CPC<\/p>\n

 <\/p>\n<\/td>\n

\n

Filing Type<\/p>\n

e-Filed Acknowledgment No.<\/p>\n

Remarks (any comments of taxpayer can be included)<\/p>\n

Upload Challan Copy <\/p>\n

Upload TDS Certificate<\/p>\n

Upload Letter requesting rectification copy<\/p>\n

Upload Indemnity Bond<\/p>\n<\/td>\n<\/tr>\n

\n

Rectification filed with AO<\/p>\n

 <\/p>\n<\/td>\n

\n

Date of application<\/p>\n

Remarks (any comments of taxpayer can be included)<\/p>\n<\/td>\n<\/tr>\n

\n

Other Reasons <\/p>\n<\/td>\n

\n

Others (any comments of taxpayer can be included)<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

ix.   If taxpayer
\nselects \u201cDisagree with the Demand\u201d, then taxpayer must furnish the details of
\ndisagreement along with reasons. Details \/ Reasons are same as provided under
\n\u201cDemand is partially correct.\u201d<\/p>\n

 <\/p>\n

x.     After the
\ntaxpayer submits the response the success screen would be displayed along with
\nthe transaction ID.<\/p>\n

 <\/p>\n

xi.     The taxpayers
\ncan click on \u201cView link under Response column to view the response submitted.
\nThe following details are displayed:<\/p>\n

 <\/p>\n

o  
\nSerial Number<\/p>\n

o  
\nTransaction ID<\/p>\n

o  
\nDate of Response<\/p>\n

o  
\nResponse Type <\/p>\n

(Note 1: Where the taxpayer has not registered on the Income
\nTax department\u2019s e-filing website \u2013 www.incometaxindiaefiling.gov.in<\/a>,
\nhe may do so to get details of outstanding demand and also to submit any
\nresponse.<\/p>\n

 <\/p>\n

Note 2: Whenever the taxpayer finds it difficult to access
\nthe Income Tax Department website, he or she may make necessary application to
\nthe Assessing officer along with above referred details as applicable in this
\ncase.<\/p>\n

 <\/p>\n

Note 3: In case of individual tax payers if CIN is not
\navailable or payment is made prior to the period of introduction of CIN, the
\ntaxpayer may submit the documents as referred in para 4.1 or 4.2)<\/p>\n

 <\/p>\n

3. Action on the Part of Department<\/p>\n

The Assessing officer or CPC Bangalore after verification
\nshould reduce\/remove\/confirm the demand in appropriate cases as per procedure
\noutlined in para 4 below and in accordance with earlier instructions issued by
\nCBDT. However, following cases are verified on priority:<\/p>\n

<\/p>\n\n\n\n
\n

a) <\/p>\n

b)          
\n  <\/p>\n

c)         <\/p>\n

d)          
\n  <\/p>\n<\/td>\n

\n

Taxpayer has furnished information in response to
\n notice u\/s 245 of the Act; or<\/p>\n

Taxpayer has requested for reduction\/removal of demand;
\n or<\/p>\n

 <\/p>\n

Information regarding demand\/removal is avilabe in department record  Records;
\n or<\/p>\n

Details are already available in the system, such as
\n additional TDS credits  reported by Deductor in case of earlier TDS
\n mismatch.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

4.                    Handling Different Scenarios
\nduring verification and confirmation of<\/strong><\/p>\n

Demand:<\/strong><\/p>\n

The Assessing Officer (AO) should handle different
\nscenarios during verification and confirmation of demand in following manner:<\/p>\n

4 . 1                                    <\/strong>Demand or tax has been paid:<\/strong><\/strong><\/p>\n

(a)    If the taxpayer’s reply or Departmental
\nrecords show that demand or tax has<\/p>\n

already been paid and challan (challan identification
\nnumber (CIN)) is available on the system:<\/p>\n

i.           
\nThe AO should reduce the demand by postingthe challan or
\npassing rectification order u\/s 154 on the system.<\/p>\n

ii.         
\nIf
\nthe demand is prior to 01\/04\/2010, the demand has to reduced directly on the
\nthe CPC-FAS system.<\/p>\n

(b) If CIN is
\nnot available or payment is made prior to the period of introduction of<\/p>\n

CIN, the reduction can be made only in case of
\ni<\/strong>ndividuals
\nand HUFs <\/strong>provided outstanding demand does riot exceed Rs.1, 00,000 for that AY. <\/strong>The AO should follow the steps as under:<\/p>\n\n\n\n
\n

i.                    
\n The
\n reduction can be made after obtaining of payment in form of taxpayer counterfoil or bank certifi
\n Department in
\n respect of payment or adjustment of re senior citizen and taxpayer is not able to obtain bank
\n c of tax is different
\n from the current place of taxpayer, the from the bank directly.<\/p>\n<\/td>\n

\n

document showing evidence of cate or any
\n communication from und.
\n In case where taxpayer is a certificate as the place of payment<\/p>\n

AO should obtain the certificate<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n\n\n\n
\n

ii.                  
\n In
\n case the outstanding demand is more than   
\n of the
\n quantum of demand being reduced under should obtain an indemnity bond (in the format given in
\n Annexure A) from the taxpayer<\/p>\n<\/td>\n

\n

.25000\/- for that AY irrespective
\n paragraph
\n 4.1.(b).i. above, the <\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n\n\n\n
\n

iii.                 
\n Additionally,
\n in case the demand being reduced under paragraph 4.1. exceeds Rs.50,000\/- for that AY for the
\n assessee, besides obtaining the bond, approval of Range Head should be taken on file
\n before removing\/ reducing the demand,<\/p>\n<\/td>\n

\n

(b).i. above
\n indemnity.<\/sup><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

iv.                
\nif the payment relates to mismatch of advance tax or
\nself assessment tax, order WS 154 of the Act needs to be passed.<\/p>\n

4.2
\nDemand due to TDS Mismatch:<\/strong><\/p>\n

(a)         If the taxpayer’s reply or Departmental
\nrecords show that the demand is on<\/p>\n

account of TDS
\nmismatch and TDS credits are available in the system, the AO should follow steps as under:<\/p>\n

i.      The AO should reduce the demand by passing
\nrectification order u\/s 15 4 on the<\/p>\n

system after taking into account the TDS
\ncredits available on the system.<\/p>\n

 <\/strong>ii.           If the
\ndemand is prior to 01\/04\/2010, the demand has to be reduced directly on the CPC-FAS system alter rectification u\/s 154.<\/p>\n

(b)    If the credits are not available in 26AS: The
\nreduction can be done only in the<\/p>\n

cases of
\nIndividuals <\/strong>arid
\nHUFs. Further, the amount of reduction should not exceed Rs.1,00,000
\nfor that AY<\/strong> and AO should take following
\nsteps:<\/p>\n

i.     AO should pass order u\/s 154 manually after obtaining the
\nTDS certificate from
\nthe assesses on the basis of which claim has
\nbeen made.<\/p>\n

In case, the outstanding demand is more than Rs.25,000 for
\nthat AY, irrespective of the quantum of demand being
\nreduced, the AO should obtain an indemnity band (in the format given in Annexure
\nA)<\/em><\/p>\n

iii.         
\nAdditionally, in case the demand
\nbeing reduced under paragraph 4.2.(b).i
\nabove, exceeds Rs.50,000\/- for that AY for the assessee, besides obtaining the indemnity bond, approval of Range Head should be taken on
\nfile before removing\/reducing the demand.<\/p>\n

4.3 Demand already reduced or action is pending:<\/strong><\/p>\n\n\n\n
\n

(a) <\/strong>If the
\n taxpayer’s reply or Departmental records show that demand has  <\/strong><\/p>\n

already
\n been reduced by way of an order (rectification order, appeal effect order
\n etc) the demand has to be reduced directly on the CPC-FAS system.<\/p>\n<\/td>\n

\n

 <\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

(b)     
\nIn case where rectification or
\ngiving effect order to reduce demand is pending,
\nthe same should be completed and revised
\ndemand should be reflected.<\/p>\n

(c)     
\nIt is also clarified that after
\ntaking action as per para 4.1 or 4.2, if any refund
\nbecomes due to the taxpayer, the same may
\nalso be I sued.<\/p>\n\n\n\n
\n

Enclosure: as above<\/p>\n<\/td>\n

\n

 <\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

 <\/strong><\/p>\n

 <\/strong><\/p>\n

(F.No.225\/151\/2014\/ITA.II) <\/strong>Copy to:<\/strong><\/p>\n

1.   
\nChairperson and all Members of CBDT<\/p>\n

2.   
\nPr.Director General of Income Tax
\n(Systems)<\/p>\n

3.   
\nAll Officers and Technical Sections
\nof CBDT<\/p>\n

4.   
\nDirector of Income tax (Inv.)\/IT
\n& Audit\/Vigilance\/Inv\/RSP&PR\/Recovery<\/p>\n

5.   
\nDirector of Income tax (O&MS),
\nNew Delhi<\/p>\n

6.   
\nITCC Division of CBDT(3 copies)<\/p>\n

7.   
\nAll
\nPr.CCIT\/Pr.DGIT\/CCIT\/DGIT\/CIT\/DIT<\/p>\n

8.   
\nData Base Cell-for placing it on
\nwww.irsofficersonline.gov.in <\/p>\n

9.   
\nDIT(S)-4
\nfor placing it on www.incometaxindia.gov.in          <\/p>\n

10.  Guard File<\/p>\n

(Rohit <\/strong>Garg)<\/strong><\/strong><\/p>\n

Deputy
\nSecretary to the Government of India<\/strong><\/p>\n

 <\/p>\n

 Annexure A<\/strong><\/p>\n

Format for Indemnity Bond (to be typed on non-judicial Stamp Paper of
\nRs. 100):<\/sub><\/em><\/strong><\/p>\n


\n<\/strong><\/p>\n

INDEMNITY
\nBOND<\/p>\n

This Bond of indemnity is made this
\n                     (Date of Indemnity
\nBond) <\/em>in<\/p>\n

favour of Government of India
\n(Department of Finance) i.e. Income Tax Department by
\nMr.\/                                                                                                                                                                                                                                                           Mrs.\/Ms<\/p>\n

___________________________ (      Name         of the<\/em><\/p>\n

Indemnifier)             <\/em>Son            of            \/            Daughter            of\/                wife            of<\/em><\/p>\n

     on behalf of        self or<\/p>\n

M\/s__ <\/p>\n

PAN_ <\/p>\n

Status<\/p>\n

 <\/p>\n

WHEREAS This is to Undertake:<\/p>\n

1.   That I had filed my Income Tax return for
\nAssessment Year                              <\/p>\n

2.   That TDS claimed in the return of Rs.                              Belongs to me as
\nper <\/p>\n

      Name of Deductor , TAN of Deductor, Date
\nof TDS Certificate, Amount.<\/p>\n

 <\/p>\n

        a.   —————–<\/p>\n\n\n\n\n
<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

\n <\/p>\n

       b.——————-<\/p>\n

OR<\/p>\n

That
\nChallan(s) paid for Rs.                                               belongs to me as given<\/p>\n

below:<\/p>\n

Date of Payment, Bank through which payment made, Amount<\/p>\n

a.   ————————–<\/p>\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/tr>\n
<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

\n <\/p>\n

b.     ———————-<\/p>\n

3.    That in case it is found that the
\nTDS certificates \/ Challan does not belong to me then the executor of this bond
\nindemnify the government of India ( Ministry of Finance) for the loss, claim and excess
\namount of refund, if an , in all respect.<\/p>\n

The executor of this bond
\nindemnifies the government of India (Ministry of Finance)
\nand keep it indemnified against all costs, damages, charges and expenses,
\nexcess <\/p>\n

amount of refund, interest, reduction in demand and also
\nagainst all sum\/ money, whether for damages, costs, charges, expenses or
\notherwise.<\/p>\n

In witness where of this bond is executed today this                                                  (Date)  <\/p>\n

(\u2026\u2026\u2026\u2026\u2026\u2026)<\/p>\n

;<\/p>\n

\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"

Government of India Ministry of Finance Department of Revenue Central Board of Direct Taxes North-Block, I TA-11, Division New Delhi the 14. 05. 2015 The CBDT vide Instruction No,4 of 2014 dated `T” April, 2014, inter-aila, prescribed Standard Operating Procedure for Verification and Correction of Demand available or uploaded by AOs in CPC Demand Portal. Further a … Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","_mi_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[4],"tags":[134],"class_list":["post-1443","post","type-post","status-publish","format-standard","hentry","category-income-tax","tag-demand"],"yoast_head":"\nProcedure for Response to Arrear Demand By Taxpayer And Verification and Correction of Demand by AOs - All About Finance<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/taxclick.org\/type\/income-tax\/procedure-for-response-to-arrear-demand-by-taxpayer-and-verification-and-correction-of-demand-by-aos\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Procedure for Response to Arrear Demand By Taxpayer And Verification and Correction of Demand by AOs - All About Finance\" \/>\n<meta property=\"og:description\" content=\"Government of India Ministry of Finance Department of Revenue Central Board of Direct Taxes North-Block, I TA-11, Division New Delhi the 14. 05. 2015 The CBDT vide Instruction No,4 of 2014 dated `T” April, 2014, inter-aila, prescribed Standard Operating Procedure for Verification and Correction of Demand available or uploaded by AOs in CPC Demand Portal. 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