The CBDT issued Revised Guidelines for Compounding of Offences under the Income-Tax Act, 1961 on 17 October 2024, which superseded all existing guidelines on the subject and are applicable to all pending as well as new applications from the date of their issuance. 

The revised guidelines have been simplified as compared to the earlier guidelines, inter alia, by eliminating the categorisation of offences, removing the limit on number of occasions for filing applications, allowing fresh applications upon curing of defects, removing the existing time limit for filing applications which was previously set at 36 months from the date of filing of complaint, etc.

Following the issuance of revised guidelines, the CBDT recently issued Circular No. 04/2025 in the form of FAQs and Press Release dated 17 March 2025, which provide necessary clarification to stakeholders on various provisions, such as scope of the guidelines, eligibility for filing applications, mode of filing compounding applications and payment of fees, terms for compounding, compounding charges and procedures for payment, time limits, and other related aspects.

In the attached newsflash, we have provided an overview of the said Circular dated 17 March 2025.  Hope you would find the same useful.

We trust you find the same useful.

RSM India Newsflash CBDT issues FAQs on Revised Guidelines for Compounding of Offences.pdf