Adjustment of FBT to Excess tax deposited

[BHASKER MURALI]

Hi, I have a small doubt that we paid excess amount as self assessment tax, so please advoice that can we adjusted to FBT for the same financial year please advoice.We have a liability in FBT

[BHASKER MURALI]

Dear sir, please advoice whether we can set off the self assessment income tax to FBT? we appreciate your earlier reply

[TUSHAR SHARMA]

No. Excess Self Assessment Tax can not be adjusted against FBT payable.

[DEV KUMAR KOTHARI]

Section 115 WL is about application of other provisions in relation to FBT. Section 237 (claim for refund) is common for IT and FBT. If there is a demand fopr FBT and refund for IT, the A.O. can adjust FBT demand agaisnt IT refund and vice versa. Therefore, you can take a chance adjust FBT liability and claim refund of lesser amount. Besides claim in retrun, send a request and clarificatory letter to the A.O. stating that mistakenly tax dues for IT and FBT were paid in combned manner or due to mistake IT paymetn was excessive so treat a part of IT paid towards FBT payable and refund lesser amount. As the issue is new, I think it will be considered in a purpose seeking manner. However, due to difference in rate of interestr payable by govenrment and by assessee, the departmetn may claim interest on FBT separately and grant interest on IT refund separately.

AI Summary

Adjustment of self-assessment tax: offset against FBT possible only through authority's adjustment of refund and demand.
Excess self-assessment income tax cannot be directly adjusted against FBT payable; however, the assessing officer may adjust an income-tax refund against an outstanding FBT demand under the claim-for-refund and set-off mechanism. Taxpayers should file a refund claim and request the assessing officer in writing to treat part of an excessive income-tax payment as payment towards FBT, bearing in mind that interest on the refund and on the FBT demand may be computed separately.