Circular No. 290 | TaxSphere

What this is

Circular No. 290 was issued by the Central Board of Direct Taxes on 31 March 1981. Its subject is 290 dated 31 03 1981.

This grants an exemption or a relief under a provision that allows one. Read the conditions attached: an exemption notification is construed strictly, and a condition missed is the exemption lost.

What it does

Tells officers to get refunds out quickly after the wealth-tax exemption limit was raised. The Finance (No. 2) Act, 1980 amended the First Schedule to the Wealth-tax Act, 1957 to raise the maximum amount not chargeable to wealth-tax from Rs. 1,00,000 to Rs. 1,50,000, with effect from 1 April 1980 under section 1(2) of that Act, so the higher limit is available from assessment year 1980-81. A good number of taxpayers had already paid wealth-tax on self-assessment on net wealth between Rs. 1,00,000 and Rs. 1,50,000 before the Bill was enacted, and become entitled to a refund. The Board directs that as soon as such a taxpayer makes a request, the assessment be taken up forthwith and the refund, if due, issued without delay, and that this be brought to the notice of all officers.

Why it was issued

Taxpayers had paid on self-assessment at the old limit before enactment and were left holding a refund claim that could not be settled until the assessment was made.

Who it reaches

Wealth-tax assessees with net wealth between Rs. 1,00,000 and Rs. 1,50,000 for assessment year 1980-81
Assessees who paid wealth-tax on self-assessment before the Bill was passed
Wealth-tax Officers holding such returns

The provisions it speaks to

Left, the provision of the Income-tax Act, 1961 as the instrument itself names it. Right, the section of the Income-tax Act, 2025 that the department’s own concordance maps it to — which is where the same ground is now covered.

Under the 1961 Act	Now
s.1	s.1
s.34A	no counterpart recorded

The instrument, as the Board published it

The words below are the department’s own, reproduced from its published text. Where the department’s copy carried a publisher’s notes after the instrument, those are not reproduced.

SECTION 34A
Refunds
SECTION 34A l REFUND OF TAX
1424. Assessee becoming entitled to refund of tax paid as a result of exemption limit being raised from Rs. 1 lakh to Rs. 1.50 lakh by Finance (No. 2) Act, 1980 - Instructions for issue of refund without delay
1. The Finance (No. 2) Act, 1980 has amended the First Schedule to the Wealth-tax Act, 1957, raising the limit of maximum amount not liable to wealth-tax from Rs. 1,00,000 to Rs. 1,50,000. The new provision has come into force from April 1, 1980 in terms of section 1(2) of the Finance (No. 2) Act, 1980. Accordingly, the benefit of higher wealth-tax exemption limit is available to taxpayers from the current assessment year, viz., 1980-81.
2. It has been brought to the notice of the Board that a sizeable number of taxpayers have paid wealth-tax on self-assessment while filing returns of net wealth, ranging between Rs. 1,00,000 to Rs. 1,50,000 prior to the enactment of the Finance (No. 2) Bill, 1980. Such assessees may become entitled to refund of tax paid in view of the fact that the exemption limit has been raised from Rs. 1,00,000 to Rs. 1,50,000.
3. The Board desire that as soon as a request is made in the type of cases mentioned in para 2, the assessments should be taken up forthwith and refund, if due, issued without any delay.
4. The above should be brought to the notice of all the officers in your charge.

Circular : No. 290 [F. No. 328/66/80-WT], dated 31-3-1981

What to watch

This is a Wealth-tax circular; the refund provision referred to is section 34A of the Wealth-tax Act, and the exemption limit is that Act's own.
The refund follows an assessment; the direction is to take up the assessment at once on a request being made, not to refund without one.
The relief runs from assessment year 1980-81, the year the higher limit first applied.
It is an instruction on despatch and priority, and creates no entitlement beyond what the amended Schedule gives.

Where you meet it

In an old wealth-tax file where self-assessment tax paid for assessment year 1980-81 was lying unrefunded.

On the same provision

Other instruments in this library that name the same provision of the 1961 Act. They are not necessarily still operative, and a later one may have replaced an earlier one without saying so.

Notification No. 70/2026 [F. No. 500/Misc./S10(23FE)/FT&TR-II] / SO 2768(E) : Infrastructure Sub-sector Businesses Notified under Schedule V — 2 the Gazette of INDIA : Extraordinary [Part Ii—sec. 3(ii)] 1 June 2026
Notification No. 17/2023 [F. No. 500/05/2018-FT&TR-III] — Ministry of Finance 6 April 2023
Circular No. 22/2022 — Condonation of delay under section 119 2 b of the income tax act 1961 in filing of form no.10a 1 November 2022
Circular No. 41/2016 — Circular No.41 of 2016 21 December 2016
Notification No. 98/2016 [F. No. 149/144/2015-TPL (Part-II)] / S.O. 3289(E) — [To BE Published in the Gazette of INDIA, Extraordinary, Part-ii, section 3, Sub-section (ii)] 25 October 2016
Notification No. 7/2016 [F.No.173/394/2015-ITA-I] / SO 529(E) — 2 the Gazette of INDIA : Extraordinary [Part Ii—sec. 3(ii)] 19 February 2016

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A circular binds the department, not you and not a court. The Board issues a circular to its own officers. An assessee may hold the department to a circular that helps him; the department cannot hold an assessee to one that hurts him, and the Tribunal and the courts decide the law for themselves.

Source: the Income Tax Department’s own published text — its page for this instrument.