The Income Tax Department has provided relief to taxpayers who recently faced additional tax demands about incorrect 87A rebate. The Central Board of Direct Taxes (CBDT) has stated that if such taxpayers pay their outstanding dues by December 31, 2025, they will not be charged interest on late payments. This order was issued under Section 119 of the Income Tax Act.

“It is noticed that in certain cases, the returns had already been processed and rebate was allowed under Section 87A of the Act on incomes chargeable to tax at special rates. In such cases, rectifications have to be carried out to disallow such rebate, which has been incorrectly allowed. Such rectifications will result in demands getting raised. If the payments of such demands raised are delayed then the same are liable fo

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