In a circular issued today (January 10), Sebi has allowed its panel of executive directors to waive or reduce interest if the interest amount is lower than Rs 2 crore. In other cases, a panel of full-time directors may reduce or eliminate it.
Article 220(1) 2 of the Income Tax Act, 1961 empowers the Sebi Recovery Officer to get better the outstanding amount together with applicable interest. Prior to the issuance of a circular, the Principal Chief Commissioner, Principal Commissioner, Chief Commissioner or Commissioner shall have the ability to reduce or waive the quantity of interest paid or payable.
Further, the Sebi Board has approved that waiver or reduction of interest won’t be applicable in cases where interest for non-payment of board fees is imposed on intermediaries under the relevant intermediation laws.
This recent rule can even not apply if interest on the quantity to be written off or refunded is collected in accordance with orders issued pursuant to Art. 11, 11B, 11 section 4 of the SEBI Act.
Application procedure
1) An application for waiver or reduction of interest could be sent to the Collection Officer having needed jurisdiction over the matter within the format prescribed by Sebi norms. The applicant shall be required to provide all supporting documents as per the prescribed income tax norms
Act 1961 The applicant shall be required to produce documentary evidence that payment of such amount has caused or would cause actual hardship to the assessee. Documents confirming the rationale for the delay in payment of the quantity. The applicant can even be required to prove that he has cooperated with any valuation investigation or any proceeding to get better any amount due from him. An application for the cancellation or reduction of interest may only be made for the period following the date of delivery of the notice of demand.
Furthermore, an application can only be made if the principal amount due under the notice is paid in full.
The order accepting or rejecting the applying in whole or partly can have to be issued inside twelve months from the top of the month by which the applying, complete in all respects, was received by the regulator.
No order rejecting an application could also be made unless the applicant has been given a possibility to be heard.
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