All banks have received RBI guidelines by virtue of which Banks are supposed to prohibit alterations / corrections on the cheque leaf.

As per RBI Circular – DPSS.CO.CHD.No. 1832/01.07.05/2009-10 dated 22nd February 2010.

Prohibiting alterations / corrections on cheques :

No changes / corrections should be carried out on the cheques (other than for date validation purposes, if required). For any change in the payee’s name, courtesy amount (amount in figures) or legal amount (amount in words), etc., fresh cheque forms should be used by customers. This would help banks to identify and control fraudulent alterations.

Basis the above guidelines branch / clearing teams can return cheques which have any alteration in the

• Payee Name
• Amount in numbers
• Amount in words

The only alteration which is allowed is the alteration in the date.

Bank branches will start returning the cheques for cash payments across the counter and Fund Transfer and clearing cheques effective 1st July 2010.

Good news for the assesses filing their Income Tax Return electronically (without digital signature) on or after 1^st April 2009. Central Board of Direct Taxes has extended the time limit for filing ITR-V to Centralised Processing Cell from 60 days to 120 days from the date of uploading of the electronic return data or till 31^st March 2010 which ever is later. This extension is applicable for all the assesses who have e-filed their income tax return after 1^st April 2009. So as per this circular if an assessee has e-filed his income tax return without digital signature on any date after 1^st April 2009 but the copy of ITR-V was not filed to Bangalore office- CPC by any reason then that assessee can again send the copy of ITR-V to CPC- Bangalore before 31^st March 2010 or 120 days from the date of filing return electronically which ever is earlier.

 However, in cases where email acknowledgement for ITR-V form is not received by the taxpayer from the CPC Bangalore the taxpayer may send another duly signed ITR-V form by speed post to Centralized Processing Centre, Electronic City Post Office, Bengalore, Karnataka – 560100. This means that if in case your ITR-V is not received by the Bangalore office by ordinary post then an assessee can send another copy of ITR-V by speed post.

The relaxation has been made following requests from taxpayers that, as a one-time measure, the time limit for filing of ITR-V form may be extended to 31st March 2010 and that alternative modes of submission of ITR-V form may also be provided in cases where an ITR-V form has not been received at CPC, Bangalore by ordinary post.

The Finance (No. 2) Act, 2009 was produced and passed by the houses of Parliament in mid of the year 2009-10. In the Finance Bill a new section Section 115WM was inserted in the Income Tax Act, 1961 to abolish the FBT with effect from Assessment Year (A.Y.) 2010-11. Till that date many of the assessee had paid advance tax in respect of value of fringe benefits provided by employer to its employees. Hence, CBDT vide its Circular No. 2/2010, dated 29-1-2010 has decided that any assessee who has paid advance tax in respect of fringe benefits for A.Y. 2010-11 shall be treated as Advance Tax paid by assessee concerned for A.Y. 2010-11. The assessee can adjust such sum against its advance tax obligation in respect of income for A.Y. 2010-11 or in case of loss to claim such payment as refund as advance tax paid in A.Y. 2010-11.

There are different penalties leviable under the Indian Income Tax Act for defaults under the various provisions of the act committed by an assessee. There are many provisions under which the penalties are leviable under the act. There are some penalties that are mandatory in nature while in most of the cases penalty is leviable at the discretion of the Assessing Officer (AO). The major penalties that are imposed under the act along with their nature of defaults are given as under:

1.  Default: Concealment of Income or furnishing inaccurate particulars of income.

     Minimum Penalty: 100% of tax sought to be evaded.

     Maximum Penalty: 300% of tax sought to be evaded.

 2. Default: Failure to keep or maintain books as required u/s 44AA.

      Minimum Penalty: Rs. 25,000/-

 3. Default: Failure to get accounts audited or furnish report u/s 44AB.

      Minimum Penalty: ½% of the total sales, turnover or gross receipts.

      Maximum Penalty: Rs. 100,000/-

 4.  Default: Taking/Repaying or accepting any loan or deposit in contravention of the provisions of section  269SS /269T  (Loan taken or repaid above Rs. 20,000 in cash).

      Minimum Penalty: Amount of loan/deposit so taken or accepted or repaid. 

5. Default: Failure to furnish Return of Income.

     Minimum Penalty: Rs. 5000/-