New Delhi: The high-level Justice Shah committee on levy of MAT on FIIs today met for the first time as it looked to expeditiously give its recommendations to resolve the contentious issue that has riled investors.
The panel, headed by Law Commission Chairman A P Shah, was formally constituted last week with former Chief Economic Advisor Ashok Lahiri and Chartered accountant Girish Ahuja as other two members.
Sources said the three-member panel met today and is believed to have discussed its terms of reference and the methodology it is going to adopt for deliberating the vexed issue.
Although the panel has one-year term, sources said the committee would submit its report on the MAT issue much earlier as the Finance Ministry is keen that it gives its recommendations "expeditiously".
The Shah committee has been entrusted with the task of examining Minimum Alternate Tax (MAT) notices to the Foreign Institutional Investors (FIIs) for the period prior to April 1, 2015.
The Income Tax Department had sent notices to 68 foreign institutional investors (FIIs) demanding Rs 602.83 crore as MAT dues of previous years. This has raked up a big controversy, with FIIs moving higher court challenging the MAT demand.
Sources said the other legacy tax issues may be referred to the Shah Committee in due course.
The committee will examine all the related legal provisions, judicial/quasi judicial pronouncements.
Finance Minister Arun Jaitley in Budget 2015-16 has exempted FIIs from paying MAT with effect from April 1, 2015.
The Finance Ministry in a statement had said that the committee may interact with various stakeholders and may also invite officers from Department of Revenue for consultations/ discussions.
Following the announcement of setting up of the panel earlier this month, the tax department has directed its field officers to put on hold issuance of fresh notices and any further assessments on levy of this tax on such entities.
"Issue of fresh notice for reopening of cases as also completion of assessment should also be put on hold unless the case is getting barred by limitation," said a CBDT circular earlier this month.
