The Central Board of Direct Taxes (CBDT) has recently amended the monetary limits for condonation of delay in refund claims and loss carry forward claims under Section 119(2)(b) of the Income Tax Act, 1961.
These revised monetary limits, specified in Circular 7/2023, will come into effect on June 1st, 2023 and amend the earlier Circular 9/2015 on the subject accordingly.
The purpose of this revision is to define the acceptance or rejection of Refund/ Loss Carry Forward applications or claims based on the amount involved for each assessment year.
CBDT Income Tax Circular 7/2023 dated 31/05/2023: Revised Monetary Limits (Refund/ Loss Carry Forward Claims Delay Condonation)
New Monetary Limits from June 1, 2023
The CBDT has notified modified/new monetary limits concerning condonation of delay in filing refund claims and claims of carry forward of losses, effective June 1, 2023, in respective of applications or claims made under Section 119(2)(b) of the Income-tax Act, 1961 for any assessment year:
1. Principal Commissioners of Income-tax/ Commissioners of Income-tax (PrCIT/CIT):
The powers to accept or reject applications or claims are vested with the PrCIT/CIT if the claim amount is up to Rs 50 lakhs.
2. Chief Commissioners of Income-tax (CCIT):
The CCIT has the powers to accept or reject applications or claims if the claim amount exceeds Rs 50 lakhs but is not more than Rs 2 crores.
3. Principal Chief Commissioners of Income-tax (PrCCIT):
The PrCCIT has been vestsed with the powers to accept or reject applications or claims if the claim amount exceeds Rs 2 crores but is not more than Rs 3 crores.
4. Central Board of Direct Taxes (CBDT):
The Board (CBDT) has been vestsed with the powers to consider applications or claims if the claim amount exceeds Rs 3 crores.
If the monetary limits for condonation of delay in filing refund claims or claims of carry forward of losses are not met, the above authorities have the right to reject such application or claim. Furthermore, it is important to note that no condonation application for refund or loss claims will be entertained beyond six years from the end of the assessment year for which such application or claim is made. Therefore, it’s essential to adhere to these limits to avoid denial of such application or claim.