Revised Constitution of Committees Dealing with Taxpayer Grievances Following Exaggerated Assessments – Income Tax

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The Central Board of Direct Taxes (CBDT) had set up a committee to deal with taxpayers’ grievances over high assessments in 2015. With the introduction of the faceless assessment regime, many features of the committee required changes. In light of the same, CBDT has now proposed revised instructions for the constitution of the Committee and its functionality to ensure an effective and efficient approach to dealing with taxpayer grievances.

Local committees will be formed across the country, which will consist of three members of the rank of Chief Commissioner of Income Tax (Pr.CIT) / Commissioner of Income Tax (CIT). The constituted committees are not only to deal with complaints from ratepayers regarding the high assessments made under the faceless and faceless regime, but also to deal with grievances relating to central charges under territorial jurisdiction.

Functioning of Local Committees

Reception of grievances under the faceless regime

Receiving grievances under a faceless regime

  • Complaints are received by the Pr.CCIT concerned either in physical form or by e-mail.

Actions taken

  • Acknowledge receipt of the grievance and keep a separate file from it;

  • Committee to consider whether case lends itself to acute assessments, failure to consider principles of natural justice, failure to apply spirit/gross negligence, misinterpretation of facts/law by the Valuation Agent at the time of placing the Order;

  • The committee may request the relevant records provided during the assessment from the jurisdictional CIT Pr., if necessary;

  • The committee may request contributions from systems such as ITBA, CPC-ITR, CPC-TDS, etc. to examine whether the grievances are related to system-related issues;

  • The committee must submit a report treating the order as acute to the relevant Pr. CCIT as well as its reasons;

  • Concerned Pr. CCIT will request information from the Assessing Officer/AU if the identified cases are considered acute assessments. In addition, he can advise Pr. CIT to prevent recovery in such cases;

  • Concerned Pr. CCIT to submit local committee reports to NaFAC and/or Income Tax (Systems) Directorate for feedback to revise policies, if necessary.

Time limit

  • Secretary will forward the grievance to the President and other members within three days of receiving it;

  • The Local Committee will endeavor to dispose of each grievance within two months of the end of the month in which it was received;

  • Secretary to ensure local committee meetings are held at least twice a month to ensure reports are submitted in a timely manner to the relevant Pr. CTIC.

  • Concerned Pr. The CCIT examines the work of the Local Committee on a monthly basis;

  • Quarterly report on the functioning of local committees to be provided to the CBDT in a prescribed format.

Our comments

Reconstituting the committee to deal with taxpayer grievances for overstated valuation is a welcome move, particularly in light of the faceless valuation regime. In addition, the fact that local committees must check for non-adherence to the principles of natural justice, non-application of the spirit, misinterpretation of facts/law, gross negligence as well as problems with the system and processing petitions within two months would ensure that taxpayer grievances are resolved satisfactorily and in a timely manner.

It should be borne in mind that the Local Committees are constituted with the intention of supporting the real grievances of taxpayers and not to be considered as alternative remedies.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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