Amendment in 73(3) by Explanation 2 - Issuance of SCN when full tax deposited with interest

[JainPal Jain]

Please ref. to prepossed amendment in 73(3) by way of explanation 2. Does it mean that no show-cause notice can be issued,if full tax along with interest has been deposited before the issue of show cause notice.

AI Summary

Proposed Amendment to Section 73(3): No Show-Cause Notices if Tax and Interest Paid Within One Year. A discussion on a proposed amendment to section 73(3) by Explanation 2 addresses whether a show-cause notice (SCN) can be issued if full tax and interest are paid before the SCN is issued. One participant confirms the amendment allows no SCN for payments made within the normal one-year period, typically during audits or anti-evasion actions. Another participant adds that while previously SCNs could be issued even if tax and interest were paid, now no penalty will be levied if paid within the period. However, payments beyond the one-year limit may still invite SCNs.