Compounding of offence u/s 279(2) of I.T. Act- exercise of power - Income Tax - F.No.285/93/94-IT(Inv.)/867

F.No. 285/93/94-IT(Inv.)/867 Ministry of Finance Department of Revenue Central Board of Direct Taxes 4th Floor, Super Bazar New Delhi dated 1st March, 1995 To All Chief Commissioners of Income-Tax, All Directors General of Income Tax (Inv.) Sir, Sub : Compounding of offence u/s 279(2) of I.T. Act- exercise of power Please refer to the above. Recently, an instance has come to the notice of the Board where an order u/s 279(2) of I.T. Act compounding an offence punishable under the I.T. Act was passed by a Commissioner of Income Tax. In the past also one or two such instances have come to the notice of the Board. 2. Section 279(2) which provides for compounding of offences punishable under the Income Tax Act was amended w.e.f. 01/04/1989. The amended provisions provided that only the Board, CCIT or the DGIT could compound an offence. The sub-section (2) of Section 279 was further amended by Finance (No.2) Act, 1991. The amended provisions which are in operation w.e.f. 01/10/1991 provide that an offence can be compounded by the Chief Commissioner or the Director General. Thus, w.e.f. 01/04/1989 the Commissioner of Income-tax is no longer empowered to pass order u/s 279(2). 3. This legal position may be kept in mind by all the Chief Commissioners and Commissioners of Income-tax while dealing with requests for compounding of offences. Needless to say that the guidelines issued by the Board vide F.No. 285/161/90-lT(Inv.) dated 30/09/1994 for compounding of the offences may also be followed in all cases. 4. These instructions may be brought to the notice of the Commissioners of Income-tax working under your jurisdiction. Yours faithfully (NISHI SINGH) OSD(Legal) C.B.D.T.