Template Description

This abeyance request template is designed for taxpayers who have received a penalty notice under Section 271AAC(1) of the Income Tax Act, 1961, and have filed an appeal before the Commissioner of Income Tax (Appeals) (CIT(A)). The template is a 2-page MS Word document mandatory for managing tax disputes and wish to ensure that penalty proceedings are put on hold until the appeal is resolved. The intended audience for this template includes taxpayers, their authorized representatives, tax professionals, and legal advisors.

Understanding Abeyance Letter - Penalty Proceedings under Section 271AAC(1) of I.T. Act

Benefits of this letter for intended users:

Taxpayers: By using this template to request an abeyance, taxpayers can prevent the enforcement of penalty proceedings while their appeal is under consideration, thereby avoiding immediate financial strain.

Chartered Accountants (CAs): The template streamlines the process of drafting abeyance requests, saving time and ensuring that all relevant details are included, which is crucial for managing multiple client cases effectively.

Tax Consultants and Advisors: The template offers a consistent and reliable format for submitting requests, which is essential for maintaining standardization in handling tax disputes.

Legal Representatives: The template provides a formal structure for requesting the suspension of penalty proceedings, which is critical for legal professionals handling tax-related cases.

Corporate Tax Departments: The template helps corporate tax departments to ensure compliance with tax regulations when requesting the suspension of penalties, reducing the risk of non-compliance.

Procedure for Requesting Penalty Abeyance:

Draft the Request Letter:

Date and Addressing: Start by including the date and address the letter to the Income Tax Officer at the National Faceless Assessment Centre

Subject and Reference: Clearly state the subject as the penalty proceedings under Section 271AAC(1) and reference the specific notice received.

Include Essential Information:

Taxpayer Details: Provide details of the taxpayer, including their name and PAN.

Details of Appeal: Mention the date when the appeal was filed with the CIT(A) and reference the assessment order against which the appeal has been lodged.

Request for Abeyance: Formally request the suspension of penalty proceedings until the appeal is decided by the CIT(A).

Attach Supporting Documents:

Proof of Appeal Filing: Attach proof of the appeal's filing with the CIT(A) to substantiate the request.

Closing the Request:

Sign Off: Sign the letter on behalf of the firm, including the authorized representative's name and designation.

 Enclosures: Mention that relevant enclosures, such as the proof of appeal filing, are included.

Conclusion:

This abeyance request template serves as a crucial document for managing penalty proceedings while an appeal is pending. It helps in formally requesting the suspension of penalty actions until the appellate authority has resolved the dispute. This process is essential for taxpayers and their representatives to ensure that penalty enforcement does not proceed concurrently with ongoing appeals, thereby offering a fair opportunity to resolve tax disputes.