Income Tax

Centralised Processing of Equalisation Levy Statement Scheme, 2023

The CBDT has notified ‘the Centralised Processing of Equalisation Levy Statement Scheme, 2023’  vide  Notification No. 03/2023-Income Tax dated  07.02.23 regarding the processing of the Equalisation Levy Statements furnished by the assessee or E-Commerce Operator (“ECO”) under Section 167 of the IT  Act, 1961^[1], i.e. furnishing of statement. The present article shall discuss the key aspects covered in the notification.

Furnishing of Equalisation Levy Statement

• The Equalisation Levy Statement, as provided under sub-section (1) of section 167 of the Act, must be furnished by every assessee or E-Commerce Operator within the time stipulated under 5 (2) of the rules.
• Such Equalisation Levy Statement, either fresh or revised, can be submitted at any time before the expiration of 2 yrs from the end of the FY in which the specified services were provided, or e-commerce supply or services were made or provided or facilitated.
• The assessee or ECO may furnish an Equalisation Levy Statement responding to the notice sent by the AO under sub-section (3) of section 167 of the Act as per rule 6 of the rules.

Invalid Equalisation Levy Statement

The Equalisation Levy Statement can be declared invalid by the Commissioner due to the following reasons.

(i) For non-compliance with the procedure regarding the use of  any software not validated and approved by the DG; or

(ii)  Furnishing incomplete information in the Equalisation Levy Statement

Processing of Equalisation Levy Statement

• The valid equalization statement shall be processed by the Centre in the following manner
• The computation of the equalisation levy shall be done upon making the adjustment for arithmetical error, if any, in the Equalisation Levy Statement
• The computation of the interest shall be based on the sum deductible or payable, depending upon the case as computed in the Equalisation Levy Statement
• The determination of the  payable sum by, or the amt.  of the refund due to, the assessee or e-commerce  shall be done after  adjusting the  value  computed under clause (b) against any amount  being paid under  166(2)  or sec-  166A or sec-  170 of the Act and any amount paid otherwise  through  tax or interest
• No intimation  must  be prepared or generated and sent after the  expiration of 1  yr  from the end of the FY  wherein  the assessee  or ECO  furnishes  the Equalisation Levy Statement or revised Equalisation Levy Statement  and has specified  the  payable sum by or the amount of refund due to, him under clause (c);
• The refund amount to the assessee or ECO, as per the determination under clause (c), would be granted to him.
• Only the revised equalisation levy statement shall be processed by the centre, and no further action will be taken on the original Equalisation Levy Statement if it hasn’t already been processed.
• The Commissioner may –

(a) Adopt an appropriate procedure for processing Equalisation Levy Statements; or

(b) Make a decision with regard to the order of priority related to the processing of Equalisation Levy Statements on the basis of administrative requirements.

• The assessee or ECO may make an application to the  AO for amending any intimation issued u/s 168 of the Act within one year from the end of the FY in which the intimation is required to be amended was issued.
• Wherever such Statement cant be processed in the Centre for any reason, the Commissioner would arrange to transmit such return to the AO  who has the jurisdiction in respect of the assessee or ECO for the purposes of Chapter VIII of the Act.
• In the event of an error in the processing of the Equalisation Levy Statement owing to a software error or an error in data entry or otherwise, resulting in an excess refund being computed or a reduction in demand of tax,  it shall be corrected by the Centre by way of passing a rectification order, and the excess amount would be recovered in accordance with the provisions of sections 220 to 227, 229 and 232 of the ITA  1961.
•  If there is any sum payable by the assessee or e-commerce operator as per Chapter VIII of the  IT Act, the refund, if any, arising from the processing of such shall be set off against such sum payable.

No Personal Appearance in the Centre

• There isn’t any need for the assessee or e-commerce operator to appear personally or through an AR  before the Centre in connection with any proceedings.
• Electronic or written communication from such person or AR in the format specified by the Centre regarding the same would be sufficient compliance with the query or clarification that has been received from the Centre.
• The Centre may ask for such clarification,  document, or evidence as may be required to enable the processing of Equalisation Levy Statements and other evidence, clarification, or document furnished electronically.

Service of notice or communication

For the purposes of this Scheme, –

 (a)  Every notice, intimation or any other communication under this Scheme from the Centre to the taxpayer or ECO or its authorised representative shall be made by–

(i) Delivering or transmitting its copy to the person  electronically sent by the  email id of the centre

(ii) Placing its copy in the regd. electronic account of the person on the designated portal ;

 (iii) Any of the modes mentioned 282 (1)  of the ITA,1961.

(b) The intimation, orders and notices must be computer generated and must not carry the physical signature of the person signing it.

Power to specify procedures and Processes

The Director General shall, by specifying the  procedures and processes from time to time for effectively implementing and proper  functioning this Scheme in an automated and mechanised environment,  inclusive of providing  the procedure and processes  with regard to the following after the approval of the Board 

• Processing of Equalisation Levy Statement;
• Validating any  of the software used for e-filing the statement;
• Call centres for answering queries and providing  taxpayer services  that  may include outbound calls to assessee or e-commerce operators requesting clarification to assist in the processing of their statements;
• Managing equalisation levy administration functions such as the issue of refunds, scanning, receipt, processing, data entry,  storage and retrieval of statements and documents in a centralised manner.

Conclusion

CBDT has introduced this scheme in the exercise of the powers mentioned in 168 (2) of the Finance Act 2016 (28 of 2016). The scheme can stream the procedure of processing equalization levy statements which can be beneficial for both the assessee and ECO.

Also Read: A Complete Overview of Equalization Levy (EL)

notification-3-2023-458930