No coercion to recover MAT dues, says CBDT
In a breather for investors, CBDT on Tuesday said taxmen won’t resort to coercive methods to recover dues towards Minimum Alternate Tax (MAT) on capital gains made by FIIs and will wait for the Supreme Court order on the issue.
“Assessing Officers (AO) can not redo their order (on levying of MAT on FIIs), but if order is in appeal, then we can certainly tell our assessing officer please don’t take it further, don’t agitate it in further and this is exactly what we did in Shell and Vodafone tax case,” Central Board of Direct Taxes (CBDT) Chairperson Anita Kapur told reporters here.
“I cannot anticipate what <g data-gr-id="31">A P</g> Shah panel will do. Shell and Vodafone case went against us and once we accepted that judgment, we told our officers please don’t do future assessments and please don’t further agitate these in appeals,” she added.
Kapur further said the merit of levying MAT on capital gains will be decided by <g data-gr-id="30">A P</g> Shah Committee and the Supreme Court. “I am only saying I am certain on the process (on the levy of MAT on FIIs)... <g data-gr-id="37">Merit</g> of the issue can also be decided by the Supreme Court,” CBDT Chairperson Anita Kapur told reporters here. “Sometimes taxpayers pay MAT and they go and file an appeal. This is an issue which is controversial... There will always be a process of refund in this...”
Asked what the government would do if the Shah panel and the Supreme Court give conflicting views, Kapur said, “We will cross the bridge when we come to it... The Commission has fixed a schedule for hearing out all the <g data-gr-id="27">stakeholders,</g> and let’s see how things proceed.”
She made it clear that the government has asked AOs to offer Double Taxation Avoidance Agreements (DTAA) relief to MAT-hit foreign investors.