Income-tax (8th Amendment) Rules, 2020

Income-tax (8th Amendment) Rules, 2020 issued on 6th May 2020 has altered the Form for application and procedure for an assessee, resident in India to invoke mutual agreement procedure provided for in agreements with other countries or specified territories.

The Amendment is brought under rule Rule 44G of Income-tax Rules, 1962 for making an application to invoke the mutual agreement procedure in Form no. 34F.

Where an assesse, being a resident of India, is aggrieved by any action of the tax authorities of any country or specified territory outside India for the a reason that is not in accordance with the terms of agreement with such other country or specified territory, he may make an application to the Competent Authority in India seeking to invoke the mutual agreement procedure, if provided in such agreement, in Form No. 34F.

The Competent Authority in India shall endeavor to arrive at a mutually agreeable resolution of the tax disputes, arising from such actions of the income-tax authorities, in accordance with the agreement between India and the other country or specified territory within an average time period of twenty-four months.

It also states that if a resolution has arrived, the same shall be communicated to the assessee, who shall communicate his acceptance or non-acceptance within 30 days. Upon acceptance of the resolution, the assessee shall withdraw any appeal filed in this regard and pay the tax determined by the assessing officer after giving effect to the resolution.

Click here to read the Notification.