Jurisdiction-free income tax assessment system and e-scrutiny of taxpayers

The Central Board of Direct Taxes (CBDT) has constituted a special task force to chart the road map for its ambitious proposal of a jurisdiction-free income tax assessment system and e-scrutiny of taxpayers.

The 13-member task force has been asked to submit its report on the new tax assessment process, which is aimed at reducing corruption and harassment of taxpayers, to the CBDT by July 31.

The CBDT, which frames policies for theincome tax (I-T) department, said it formed the task force after it had “agreed” with the recommendations of an earlier committee that suggested changes in the age-old methods of assessment and scrutiny done by the taxman.
The committee had suggested to the CBDT that departmental databases such as PANshould be used to better the tax assessment system in the favour of the tax-paying public.

The Board said it feels that different category of taxpayers should be “segmented” and a “new ecosystem” should be created for conducting scrutiny assessments.
The 13-member task force is headed by a principal chief commissioner of income tax-rank officer. The other members have been drawn from various regions and streams of the I-T department set-up.

The board added it had also agreed for having a “flexible function-specific jurisdiction for certain actions and pre- verification of information mismatch before full-fledged scrutiny”.
“While e-assessment is being implemented in phases, in respect of other recommendations, a task force is hereby constituted by the board to examine the feasibility of these recommendations and also to suggest how best to implement the recommendations found feasible, in medium and long terms,” the CBDT order said.

Under the proposed jurisdiction-free assessment, which PTI had reported earlier this week, it is being mooted that a taxpayer could be assessed by an assessing officer (AO) of the department based in any part of the country.

This proposal is aimed at reducing instances of corruption and harassment of the taxpayers.

For example, the Income Tax Return (ITR) and scrutiny case papers of a taxpayer living in Delhi could be assessed by an AO based in Mumbai or Kochi, an official had explained earlier.

Similarly, the task force will also suggest ways to make easy the system of scrutiny where a taxpayer is required to provide a number of documents and testimonials to the AO after his or her case is picked up for a threadbare examination.

The department has said that it only picks less than one per cent of total I-T Returns (ITRs) filed for examination under the long-drawn scrutiny process but this has still been a issue of grievance for many.

The CBDT order said while giving its recommendations, the task force would also suggest possible changes in law, adequacy of infrastructure additional funds for implementing the proposed changes, modification in business processes as well as training and other capacity building measures which may be required to be taken by it.

It added the task force should also prepare a blueprint for implementation of the suggested recommendations.

The CBDT is also set to soon implement the system of conducting limited scrutiny cases via the ‘e-proceeding’ system that had been notified recently under the ambitious Internet-based paperless communication system of tax dealings.

The new e-proceeding procedure, the CBDT has said, is a part of e-governance initiative to facilitate a simple way of communication between the department and the taxpayer, through electronic means, without the necessity of the taxpayer to visit the I-T office.

About Nitika Bansal 116 Articles
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