I-T not to reopen cases before April 1, 2012: FM
Foreign investors worried over retrospective tax on merger and acquisition (M&A) deals like that of Vodafone, which were done overseas but involved domestic assets, can now breathe easy. HT reports.business Updated: May 30, 2012 23:36 IST
Foreign investors worried over retrospective tax on merger and acquisition (M&A) deals like that of Vodafone, which were done overseas but involved domestic assets, can now breathe easy.
Finance minister Pranab Mukherjee on Wednesday said that the Income-Tax separtment will not re-open cases where assessment proceedings had been finalised before April 1, 2012.
“I gave a commitment in Parliament with regard to retrospective amendments that the Central Board of Direct Taxes (CBDT) will issue a policy circular to clarify that in cases, where assessment proceedings have become final before the first day of April 2012, such cases shall not be reopened,” Mukherjee said after inaugurating the new direct taxes building (Pratyaksh Kar Bhawan) in the Capital on Wednesday.
“Now CBDT has issued a circular in this regard,” he added.
In Budget 2012-13, the finance minister had proposed to amend the I-T Act 1961, with retrospective effect.
“Case like that of Vodafone, which is not closed won’t come under this clause,” an I-T official told HT.
Mukherjee said that he has constituted an advisory group to resolve issues pertaining to transfer pricing and international taxation.
Worried over mounting tax litigations, Mukherjee also asked tax officials to avoid moving high courts in case the question of law is not involved in disputes.
“Normally my advise would be, with the two appeals at the commissioner’s level, the department need not rush to the high court, if there is no point of law concerned,” the finance minister said.