In case of ambiguity, assessee must prove eligibility for tax exemption: SC

In a judgment that will benefit the revenue department, a Constitution bench of the Supreme Court on Monday said tax assessees will have to show clear proof to the Revenue Department that they are eligible for availing a tax exemption and the benefit of any ambiguity in exemption provision/notification would fall in the favour of the tax man.

The five-member bench, comprising Justices Ranjan Gogoi, NV Ramana, R Banumathi, Mohan M Shantanagoudar and S Abdul Nazeer, was constituted to look into what is the rule to be applied while interpreting a tax exemption provision or notification when there is an ambiguity.

The bench put responsibility on the assessee to prove a tax exemption where the guidelines aren’t clear and said he cannot claim the benefit of any such ambiguity in provisions.

While overruling a judgment in the Sun Export case that had held a contrary view, the bench, in an 83-pages judgement, said “exemption notification should be interpreted strictly; the burden of proving applicability would be on the assessee to show that his case comes within the parameters of the exemption clause or exemption notification”.

Operation clean money: 1 cr accounts scanned; 18 lakh clarifications sought

Latest News - In a bid to clamp down on unaccounted money funnelled into bank accounts post demonetisation, the tax department has scrutinised and matched as many as one crore accounts and asked 18 lakh people to explain the source of their funds.

The tax department has run big data analytics through more than one crore accounts in its data bank and done matching with the taxpayer profile of the holder, a top source said.

As per I-T records, there are 3.65 crore individuals who filed income tax returns. Besides, there are over seven lakh companies, 9.40 lakh Hindu Undivided Families and 9.18 lakh firms who filed ITRs during Assessment Year 2014-15.

Also, over 25 crore zero-balance Jan Dhan accounts were opened as part of the (Read More)