| Notification Detail :
It has come to the notice of the Board that due to recent devastation caused by the floods inthe State of Jammu & Kashmir, the income-tax assessees of that State are facing difficulties inensuring compliance either with the requirements under ongoing scrutiny assessment proceedingsor with respect to notices u/s 143(2) of the Income Tax Act, 1961 ('Act') issued recently.
2. In such cases, where an assessee under scrutiny claims that he is unable to make certaincompliances due to destruction of records, documents and books of accounts etc. in the floods, theAssessing Officer may ascertain from the district administration whether the area in which thebusiness premises of the assessee concerned is located and where the books of accounts,documents etc. are claimed to had been kept was affected by the recent floods or not. If thedifficulties conveyed by the assessees are found to be genuine and beyond his control making himunable to produce books of accounts etc., the pending assessments may be completed on the basisof materials available on record. The Assessing Officers are further advised to keep in mind thefollowing points while finalizing assessments in such cases:-
i) In cases of non-production of books of accounts, documents, records etc.requisitioned u/s 143(2) / 142(1) of the Act, the Assessing Officer, even if invokingthe provisions of section 144 of the Act, should avoid framing a high pitchedassessment containing frivolous additions merely on account of non-production ofrelevant books of accounts, documents or records;
ii) Third party verifications, if necessary, should generally be made in cases where suchthird party is located outside the affected areas. Taking recourse to special audit u/s142(2A) and conducting surveys u/s 133A of the Act should only be done in caseswith substantial merit and with prior approval of CIT concerned;
iii) If a particular case has been completed under scrutiny during earlier years, therecords concerned could be perused to understand the trend in business activity. If itis possible to draw any reasonable and convincing inference, the same may beutilized while finalizing the pending scrutiny assessment;
iv) Post-assessment action on recovery of outstanding demand should be decided bythe Assessing Officer on a case to case basis and after taking into consideration theassessee's financial condition in the aftermath of floods;
v) The Income-tax Authorities should expeditiously take all necessary steps withadequate sensitivity to resolve grievances and difficulties faced by the tax payers.
4. The above may be brought to the notice of all concerned for compliance. Affected taxpayers may also be informed suitably through a Press Note to be issued by the CCIT, Amritsar.
Yours faithfully.
(Riche Rastogi)
Under Secretary (ITA,I1)
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