New Delhi, Sept 29: Government has simplified and reduced the compounding fees for tax offences in recent amendments to tax laws. The new guidelines for compounding of offences under direct tax laws have been brought into effect from July 29, 2003, the central board of direct taxes said in a release.

According to the new norms, the compounding fee in respect of the offences related to Section 276b, Section 276dd, Section 276e, Section 276cc, Section 276c(1), has been substantially reduced.
The measure has been taken to encourage assessees to get their offences compounded.

The CBDT has also made procedural amendments in tax laws.

Accordingly, all types of cases relating to technical offences are to be compounded by chief commission or director general of income taxes.
Moreover, distinction between the first offence and subsequent offences has been removed.

Bureau Report