After being pulled up by Prime Minister Narendra Modi for undue harassment of taxpayers, the income tax department has decided to deal with the issue of aggressive tax assessments by its officials.
The income tax department will set up local committees in every region to deal with taxpayer grievances arising out of high-pitched assessments, the central board of direct taxes (CBDT) said in an internal communication dated 9 November. Mint has reviewed a copy of the communication.
The tax department pointed out that such assessment orders lead to harassment of taxpayers besides wasting the time of the department and appellate tribunals.
At a review meeting in March this year, Modi had expressed dissatisfaction about delays in responding to public grievances by income tax officers, as well as the harassment of taxpayers.
“A need has been felt to lay down an institutional mechanism to quickly resolve the taxpayers’ grievances arising on account of high-pitched and unreasonable additions made by the assessing officers,” CBDT wrote to its officers.
“Local committees to deal with taxpayer grievances from high-pitched scrutiny assessments are required to be constituted to in each Pr CCIT (principal chief commissioner of income tax) region across the country,” it said, adding that such committees should be set up within the next one month.
These committees have been asked to dispose of all grievance petitions within two months. They have been asked to flag instances of any high-pitched assessments to the Pr CCIT, who will take action on them.
“The committee would ascertain whether the addition made in assessment order are not backed by any sound reason or logic, the provisions of law have grossly been misinterpreted or obvious and well established facts on record have been outrightly ignored. The committee would also take into consideration whether the principles of natural justice have been followed by the assessing officer,” the order said.
A fair, simple and stable tax regime has been one of the key promises of the National Democratic Alliance (NDA) government.
The government is hopeful that some of the steps it has taken over the last few months including making tax return filing and refund process more simple will help improve its rankings in the World Bank’s ease of doing business index.
In the sub-category of paying taxes, India is ranked 157 among 189 countries in the World Bank’s latest doing business report.
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