Section - 241A - Processing of return within the prescribed time and enable withholding of refund in certain cases -


Under the existing provisions of section 143(1D) processing of returns shall not be necessary where a notice has been issued to the assessee under section 143(2). With effect from assessment year 2017-18 however, such processing has been made necessary before passing an assessment order. In order to address the grievance of delay  in issuance of refund in genuine cases routinely selected for a scrutiny it is proposed that the section 143(1D) shall cease to apply in respect of returns for assessment year 2017-18 onwards.


In order to ensure recovery in doubtful cases, a new section 241A is proposed to be inserted to provide that for returns relating to assessment year 2017-18 onwards where refund of any amount becomes due to the assessee under section 143(1) and the assessing officer is of the opinion that grant of refund may adversely affect the recovery, he may after recording reasons and with the previous approval of the Principal Commissioner or Commissioner, he may withhold the refund upto the date of assessment.


The amendment will be effective from 1st April 2017 in relation to assessment year 2017-18 onwards.