The Central Board of Direct Taxes (CBDT) on March 17, 2025, issued a circular regarding Frequently Asked Questions (FAQs) on Guidelines for Compounding of Offences under the Income-Tax Act, 1961.
The following has been stated: -
•The CBDT issued revised guidelines for the compounding of offenses under the Income-tax Act, 1961 on October 17, 2024, simplifying the process by eliminating offense categorization and limits on applications. It allows fresh applications if defects are cured, and includes compounding for offences under sections 275A and 276B.
•A circular with clarifications has been issued to enhance understanding. Compounding does not equate to an admission of guilt by the applicant.
The detailed circular is given in the document below.
[Circular No. 04/2025]
