Emails sent for clarity on refunds: CBDT

The Income-Tax (I-T) Department on Tuesday said computer generated emails sent to about 172,000 assesses such as individual taxpayers, corporate and start-ups are “just a request for seeking an update” and “cannot be misconstrued as” a notice of recovery.

The Central Board of Direct Taxes (CBDT), the apex body regulating income-tax matters, dispelled doubts about the allegation that the I-T department was pursuing recovery proceedings and using arm-twisting methods by adjusting outstanding demands of the start-ups.

Mohandas Pai, co-founder of venture fund Aarin Capital, on Monday tweeted about the alleged overreach by the I-T department, tagging finance minister Nirmala Sitharaman: “Startups Left Fuming As Angel Tax Makes I-T Returns Complicated, @nsitharaman Mam pl see … Govt had made a promise, to settle angel tax but this is wrong!” Sitharaman, in August 2019, exempted start-ups registered with the department for promotion of industry and internal trade (DPIIT) from angel tax.

CBDT said the I-T department had sent emails seeking clarification from assesses who were entitled to get tax refund, but also had outstanding tax to pay. “These computer generated emails have been sent to almost 1.72 lakh assessees which includes all classes of taxpayers – from individual to HUF to firms, big or small companies including start-ups and therefore to say that start-ups are being singled out and harassed is total misrepresentation of facts,” the statement said. These emails are part of the faceless communication that protects public money by ensuring that refunds are not released without adjusting outstanding demands of the past, it said.

“These emails are auto-generated u/s 245 of the I-T Act in refund cases where there is any outstanding demand payable by the assessee,” it said.

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