Faceless assessment scheme: assessment orders to be processed through national e assessment centre; limited exceptions apply.
The Board directs that all income tax assessment orders shall be passed by the National E Assessment Centre through the Faceless Assessment Scheme, with only Central Charges and International Tax Charges exempted; any assessment not complying with this mandate is to be treated as deemed never passed, and the instruction is effective from 13 August 2020.

Power of survey limited to officers in Investigation Wing and TDS Commissionerates, with specified approval authorities.
The order designates that the Income-tax Authority for exercising the power of survey under section 133A shall be only officers posted in the Directorates of Investigation (Investigation Wing) and in Commissionerates of TDS, and that approval for such surveys rests with DGIT (Investigation) for investigation wing and Pr.CCIT/CCIT (TDS) for TDS charges.

Mutual Agreement Procedure access governs MAP applications, acceptance, negotiation, implementation of MAP outcomes and procedural requirements.
Mutual Agreement Procedure (MAP) under India's DTAAs provides an alternative dispute resolution route for double taxation or taxation not in accordance with treaty terms. Taxpayers apply to the Competent Authority of their residence in Form No. 34F with prescribed facts and documents. The CAs exchange position papers, negotiate bilaterally or multilaterally, and formalise mutual agreements. The guidance defines admissible issues, grounds for denial of access, technical constraints on downward adjustments, treatment of interest/penalties and secondary adjustments, interaction with APAs, and procedures and timelines for implementing MAP outcomes in India.

Controlling person rules clarified: trusts' settlors, trustees and beneficiaries are treated as controlling persons; AML reliance limited.
RFIs may rely on information under the Prevention of Money laundering Act only to the extent those rules conform to the 2012 FATF recommendations. For trusts, the definition of controlling person follows Explanation 2 to Explanation (B) to Rule 114F(6), requiring RFIs to treat settlors, trustees, beneficiaries (regardless of interest size) and any natural person exercising ultimate effective control as controlling persons for due diligence. For new entity accounts of passive non financial entities, RFIs may rely on self certification from the account holder or controlling person to determine reportability, per the CRS commentary.

Sovereign Wealth Fund tax exemption requires notification, application, audited return and quarterly investment reporting for compliance.
The Finance Act, 2020 provides an exemption under section 10(23FE) for dividend, interest and long term capital gains on investments by specified sovereign and pension funds in specified infrastructure businesses held for at least three years. Notified Sovereign Wealth Funds must apply using Form I (certifying government ownership, non commercial status and appropriation of earnings), file income tax returns with an audit report, and submit electronic quarterly investment intimations in Form II within one month of each quarter end, with verification and supporting documentation.

Information sharing through NATGRID: income tax authority authorised to furnish taxpayer data to law enforcement under MoU safeguards.
The Principal Director General of Income tax (Systems) is designated as the specified income tax authority to furnish and receive PAN, TAN, bank account details, return and TDS summary information and other mutually agreed data through the NATGRID platform to listed investigative and intelligence agencies. The authority must form an opinion that sharing is necessary for the recipient agencies' statutory functions and will execute a Memorandum of Understanding with NATGRID covering data transfer mode, confidentiality, secure preservation, weeding out, and timelines, with the MoU forwarded to the CBDT division for record.

Information sharing under section 138(1)(a): map income tax payees to PM KISAN beneficiaries using Aadhaar for verification.
The Principal Director General of Income tax (Systems), New Delhi is directed to furnish information to the PM KISAN Nodal Officer and the Joint Secretary (Farmers Welfare) by providing a mapping of income tax payees for the relevant assessment years from the list of otherwise eligible PM KISAN beneficiaries on the basis of Aadhaar numbers, under the Board's power to require information under section 138(1)(a) of the Income tax Act.

TDS on cash withdrawals: specified pre amendment exemptions remain valid under the amended proviso, subject to conditions.
Three pre-amendment notifications exempted specified entities-cash replenishment agencies and WLATMO franchisees for ATM cash replenishment; APMC commission agents/traders registered under state APMC laws; and authorised dealers/FFMCs and their agents for specified foreign exchange purchases and remittance disbursements-from TDS under section 194N subject to conditions. Following amendment, the proviso became the fourth proviso; the Board clarifies that the three notifications shall be deemed issued under the fourth proviso and the exemptions continue to be subject to their stated conditions.

Information sharing under tax law: designated income-tax authority to provide PAN-linked CTR data to FIU-IND for analysis.
The Principal Director General of Income-tax (Systems), New Delhi is designated as a specified income-tax authority to furnish CTR-related information to FIU-IND: where FIU-IND has PAN, specified fields including PAN, name, parent/spouse name, addresses, PAN creation date, DOB/incorporation date, last return year, income and turnover ranges and other requested information will be shared; where PAN is absent, a PAN database dump will be supplied to enable subsequent sharing of the specified data fields.

Information sharing under section 138(1)(a): tax data to be furnished to the Ministry of MSME under MoU safeguards.
The Principal Director General of Income tax (Systems), New Delhi, is designated under section 138(1)(a) to furnish specified taxpayer information to the Ministry of MSME, limited to Schedule DPM (depreciation on plant and machinery) from ITR 3/5/6, sales/gross receipts from ITR 3/5/6, and gross turnover/gross receipts from ITR 4. A Memorandum of Understanding with the notified Ministry authority will govern mode of transfer, confidentiality, secure preservation, data weeding after use, and timelines, and a copy of the MoU must be sent to the issuing division for record.

One-time verification relaxation allows late ITR-V or EVC/OTP verification to regularize affected electronic returns before consequences apply.
One-time relaxation permits electronically uploaded returns for assessment years 2015-16 to 2019-20 that remained unverified due to non-filing of ITR-V to be verified by sending a signed ITR-V by speed post or by EVC/OTP modes (Aadhaar OTP, net-banking, EVC via bank account, demat account, or ATM) by 30.09.2020; exclusions apply where other statutory measures were taken. Such regularized returns shall be processed and intimation issued by 31.12.2020, with refund interest governed by the applicable interest provision; failure to regularize may attract consequences for non-filing/unverified returns.

Relaxation of processing time limits allows time-barred valid returns with refund claims to be processed subject to administrative approval.
Validly filed returns up to assessment year 2017-18 with refund claims that remained unprocessed under section 143(1) and became time-barred due to reasons not attributable to the assessee may be processed in non-scrutiny cases subject to prior administrative approval of the Principal CCIT/CCIT; following approval the Principal CIT/CIT shall request the Principal DGIT(Systems) to enable the Assessing Officer so that intimation under section 143(1) can be issued and consequent refund procedures can follow.

Mandatory electronic payment requirement exempted for businesses with only B2B transactions when virtually all receipts are non-cash.
Section 269SU mandates that specified persons must offer prescribed electronic payment modes-Debit Card powered by RuPay, UPI and UPI QR Code. The circular exempts a specified person with only B2B transactions (no retail customers) from section 269SU if at least ninety five percent of aggregate receipts in the previous year, including sales, turnover or gross receipts, are received by modes other than cash.

Residency determinations under the Income-tax Act: COVID-related involuntary stays excluded from days-count for status assessment.
Administrative relief excludes specified periods of involuntary stay from the computation of days present in India for assessing residency under section 6 where individuals who arrived before 22 March 2020 were unable to depart due to COVID 19 restrictions: (a) days from 22 March to 31 March if unable to leave by 31 March; (b) quarantine period from its start until departure or 31 March if quarantined on or after 1 March; and (c) days from 22 March to departure if evacuated on or before 31 March.

Vivad se Vishwas Act correction: circular amends wording and extends referenced deadline in specified answers of the circular.
Corrigenda amend Circular No. 9/2020 on the Direct Tax Vivad se Vishwas Act, 2020: replace "Bill" with "Act" in answer to question 1; and in answers to questions 26, 28, 29 and 41 substitute every occurrence of "31st March, 2020" with "30th June, 2020", thereby rectifying wording and revising the specified date references.

Tax audit reporting obligations under Form 3CD clauses 30C and 44 deferred due to COVID-19 disruption.
The Board decided, in view of implementation difficulties caused by the COVID-19 pandemic and following prior extensions, that reporting under clause 30C and clause 44 of Form No. 3CD shall be kept in abeyance until a further date specified by the Board, treating the matter as an administrative deferral of specified tax-audit disclosure obligations introduced by the 2018 amendment to Form 3CD.

Vivad se Vishwas settlement permits final resolution of pending income tax disputes through declaration and prescribed payment.
The Direct Tax Vivad Se Vishwas Act, 2020 enables final settlement of specified pending income tax disputes by filing a declaration and paying an amount determined by the Designated Authority; covered matters include appeals, writs, SLPs, DRP proceedings, revision applications and arbitrations where total income is determined, subject to exclusions for certain AAR matters, search related thresholds and instituted prosecutions. The DA computes disputed tax, credits prior payments, issues a certificate, and upon payment the DA's order waives specified interest and penalties and bars further proceedings in respect of the settled tax arrears.

Option under section 115BAC: employees may notify employers to apply concessional tax rates for TDS.
An employee intending to opt for the concessional regime under section 115BAC may intimate the employer for the previous year; upon such intimation the employer shall compute total income and make TDS in accordance with that regime. If no intimation is made, the employer shall deduct tax without considering the concessional regime. The intimation is only for TDS purposes, cannot be modified during the year, and does not replace the formal option which must be exercised with the return under section 139(1).

Assessee in default relief for short TDS/TCS where pre Bill transactions met withholding, deposit and filing conditions.
A person responsible for deduction/collection will not be treated as an assessee in default for short TDS/TCS caused by enhanced surcharge where the transaction was completed and paid on or before 5th July 2019 with no subsequent transactions in the year; TDS/TCS was made at pre enactment rates; the tax was deposited by the due date; and the TDS/TCS statement was filed by the due date. Failure to meet any condition disqualifies relief. If shortfall is recovered after 5th July 2019 from later transactions, no interest will be levied. Deductee/payee remains liable to pay correct tax including enhanced surcharge.

Lower nil deduction/collection certificates: existing certificates temporarily extended under conditions; new TANs or rate revisions require fresh applications.
Existing lower/nil deduction/collection certificates for F.Y. 2019 20 remain valid for their originally specified period and are additionally valid for the transitional period at the start of the following year subject to original order conditions; threshold limits assigned for 2019 20 apply unchanged for that transitional period. Electronic communications may be used for internal approval and issuance. New/different TAN applications or requests to revise certificate rates are excluded from the relaxation and must be applied for afresh per the annexure procedure.