Tuesday, October 15, 2013

ELECTRONIC TAX ADMINISTRATION - NEEDS FOR "HUMAN TOUCH"

The Central Board of Direct Taxes has rightly initiated and implemented electronic administration of tax department including filing of Income Tax Returns, assessments, refunds. The tax deduction at source, issuance of certificates, availability of data on the website in form 26 AS are some very significant achievements. The electronic filing of returns has brought some very serious teething problems, which are required to be addressed immediately including:


  1. Issuance of large number of notices for non-payment of tax deduction at source and creating demand, in spite of full compliance due to technical errors in the system or in typing.
  2. MAT credit not being adjusted in next year processing in a number of cases.
  3. Carry forward losses, assessed in previous years, not being carried forward for future assessment.
  4. Tax Deduction at Source by the deduct or not being reflected in form 26 AS. This is not being corrected for several months even after rectification procedure.
  5. In number of cases even though TDS credit is available in form 26 AS, the demands are still created, without giving full credit of TDS and in a number of cases even tax paid credit is not given.
  6. All larger refunds of more than Rs 50, 000 are not being remitted to the tax payers, who are entitled to refund. In certain cases, in spite of written communications with Central Processing Cell as well as the concerned assessing officers, refunds are still not being credited. Refunds are pending for years.
  7. The I T department site is showing a number of unpaid taxes or demands due, although no basis is ever communicated for several years.

The government need to initiate a help line including a proper procedure for resolving the
aforesaid issues in a simplified manner. Some senior officers need to be deputed to bring solutions to the problems tele phonically or electronically,in a time bound manner. In addition to guidelines, simple FAQ, it is mandatory that a personal guidance or assistance is available from the tax administration.

Tax Assessment:

We have been taking up to the Government that even scrutiny assessment should be undertaken
electronically through video or audio conferencing along with electronic communication of queries, to completely eradicate the chances of corruption in assessment, refund and rectification application.The personal hearing should be by a committee in camera, in case assesse still need justice. The corruption has to be eradicated from the system. We sincerely hope that the leadership will take up such important issues more effectively and efficiently.

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