The Central Board of Direct Taxes (CBDT) issued Circular No. 15/2024 on November 4, 2024, establishing monetary limits for income-tax authorities concerning the reduction or waiver of interest under Section 220(2) of the Income Tax Act, 1961. This section imposes interest on taxpayers for delayed payment of tax as per demand notices issued under Section 156, at a rate of 1% per month. However, under Section 220(2A), certain authorities are empowered to reduce or waive this interest if specific conditions are met. According to the circular, the Principal Commissioner of Income Tax (Pr.CIT) or Commissioner of Income Tax (CIT) can waive interest for amounts up to ₹50 lakh, while the Chief Commissioner of Income Tax (CCIT) or Director General of Income Tax (DGIT) can handle amounts exceeding ₹50 lakh but not exceeding ₹1.5 crore. The Principal Chief Commissioner of Income Tax (Pr.CCIT) has authority for amounts above ₹1.5 crore.
To qualify for a waiver or reduction, taxpayers must demonstrate genuine hardship, circumstances beyond their control that led to the delay, and cooperation with any inquiries or recovery proceedings. These guidelines aim to streamline the administration of interest waivers for taxpayers facing exceptional difficulties. The circular is effective immediately upon issuance, and the relevant provisions are accessible on official income tax websites for taxpayers and stakeholders.
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F.No. 400/08/2024-IT(B)
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
Circular No. 15/2024-Income Tax | dated: 4th November, 2024
Subject: Order under section 119(1) of the Income-tax Act, 1961 fixing monetary limits of the income-tax authorities in respect of reduction or waiver of interest paid or payable under section 220(2) of the Income-tax Act- reg.
Section 220(2) of the Income-tax Act (`the Act’) deals with the consequences of non-payment of income tax by a taxpayer. As per Section 220(2) of the Act, if a taxpayer fails to pay the amount specified in any notice of demand under section 156 of the Act, she shall be liable to pay simple interest at the rate of 1% per month or part of the month for the period of delay in making the payment. Further, section 220(2A) of the Act empowers the Principal Chief Commissioner (Pr.CCIT) or Chief Commissioner (CCIT) or Principal Commissioner (Pr.CIT) or Commissioner (CIT) for reduction or waiver of the amount paid or payable under section 220(2) of the Act in the circumstances specified therein.
2. In accordance with the powers vested with the income-tax authorities specified in section 220(2A) of the Act in respect of reduction or waiver of the interest paid or payable under section 220(2) of the Act, the Central Board of Direct Taxes, for the proper administration of the Act, hereby specifies the following monetary limits as under:
| S. No | Income-tax Authority | Monetary Limits for reduction or waiver of interest |
| 1. | Pr.CIT/ CIT | Upto Rs.50 lacs |
| 1. , | CCIT/ DGIT | Above Rs. 50 lacs to Rs. 1.5 crore |
| 2. | Pr.CCIT | Above Rs. 1.5 crore |
3. The powers of reduction or waiver of the interest paid or payable under section 220(2) of the Act in respect of any income-tax authority shall continue to be subject to satisfaction of all the following conditions specified under section 220(2A) of the Act-
“(i) payment of such amount has caused or would cause genuine hardship to the assessee ;
ii. default in the payment of the amount on which interest has been paid or was payable under the said sub-section was due to circumstances beyond the control of the assessee ; and
iii. the assessee has co-operated in any inquiry relating to the assessment or any proceeding for the recovery of any amount due from him.
4. The above shall come into effect from the date of issue of this Circular. Hindi version shall follow.
(Rubal Singh)
Deputy Secretary (IT-Budget),
CBDT, New Delhi
Copy to:-
1. The Chairman & Members, CBDT
2. All Pr.CCsIT, CCsIT/ DGsIT.
3. All Joint Secretaries/CsIT, CBDT.
4. Commissioner of Income-tax (Media & TP) and official Spokesperson, CBDT, New Delhi.
5. ADG (PR,P&P) for necessary action.
6. JCIT, Database Cell, with a request to upload the order on the website irsofficersonline.gov.in.
7. Web Manager, 0/o DGIT(Systems) with request to upload on the departmental website of incometaxindia.gov.in.
8. The Institute of Chartered Accountants of India, IP Estate, New Delhi
9. All Chambers of Commerce.
10. Hindi Cell for translation.
11. The Guard File.
(Rubal Singh)
Deputy Secretary (IT-Budget),
CBDT, New Delhi
very useful to updste