Trust based approach: CBDT accepts over 99% I-T returns

Finance Ministry today said over 99 per cent of the returns filed are "accepted" by the Income Tax Department and only a minuscule number is taken up for scrutiny where the taxman has no discretion.
"CBDT is already following a trust based approach in tax administration. Over 99 per cent of the tax returns filed by the taxpayers are accepted as such.
"Less than 1 per cent of the returns are selected through Computer Aided Scrutiny Selection in a non-discriminatory and non-discretionary manner," it said.
The ministry today listed the accepted and implemented recommendations of the Tax Administration Reforms Commission (TARC) headed by Parthasarathi Shome.

It said CBDT follows a collaborative and solution oriented approach.
Only a minuscule number is taken up for scrutiny based on specific criteria in which the taxman has no discretion. CBDT has also issued specific instructions from time to time to deal with issues that arise during scrutiny process, it added.

Processing of returns not taken up for scrutiny is also done by CPC-ITR in a nondiscriminatory and non-discretionary manner, it added.
TARC in its reports had said there was a lack of trust and mutual suspicion between the taxpayers and the administration, which impedes the promotion of voluntary compliance.

Therefore, the Central Board of Direct Taxes (CBDT) and Central Board of Excise and Customs (CBEC) must strive actively to create a trust-based administration, it said.
On another recommendation of TARC, the ministry said a dedicated vertical for delivery and monitoring of Taxpayer Services has been set up in CBDT, its attached Directorates and at field offices.
In case of CBEC, the TARC had suggested that on disposal of a case by Supreme Court/High Court and if the judgment is accepted by the Department, an instruction should be issued to all authorities to withdraw appeal in any pending case involving the same issue.

On this recommendation, the ministry said departmental instructions has been issued to review the appeals filed in view of the judgment of the Supreme Court in a similar case.
The TARC had given its report in four volumes containing a number of recommendations on tax reforms including on simplification in tax administrations.
TARC had given 254 recommendations for CBDT and 291 for the CBEC.
In case of CBDT, 47 recommendations have not been accepted and 207 have been "accepted/acceptable with modification". Further, 34 recommendations have been implemented while 173 are under implementation.
In case of CBEC, 27 are not acceptable and 246 have been "accepted/acceptable with modification". Seventy-seven recommendations have been implemented and 169 are under implementation.