Author : Khyati Dharamsi/DNA
Content : The taxman is a tough nut to crack. DNA had on May 27 reported (Mr Chidambaram, look what your taxmen are up to) that the Income Tax office at the Bandra-Kurla Complex had been insisting on salaried individuals filing their returns for assessment year 2008-'09 (i.e. the last financial year, 2007-'08) to attach annexures like Form 16 (given by employers to salaried individuals), rent and dividend receipts, or advance tax challans.
Two months later, the situation hasn't changed much. When we visited the Bandra Kurla complex office of the Income Tax department, again we found that the taxmen continue to insist on annexures while filing returns, though this time not for everybody. The clerk at the counter insisted on annexures such as form 16, tax deducted at source (TDS) certificates etc for individuals who had tax deducted at source of Rs5 lakh or more.
Public relations officials of the Income Tax department in Bandra, however, maintain that individuals who claim a tax refund need to attach annexures else they would have to wait for two to three years to get their refunds. A public relations officer of the income tax department at Bandra who did not wish to be named says, "If people do not want to submit form 16 then they will need to wait for 2-3 years for the software to process the returns. For those who do not have any refunds we are not asking for the Form 16. But for those who have refunds, we need to verify the TDS mentioned in the returns. We are not able to process the returns otherwise."
There has been no change in law since the annexure less Indian Income Tax Return (ITR) forms were introduced last year. The law does not require individuals to attach annexures like Form 16 (given by employers to salaried individuals), rent and dividend receipts, or advance tax challans while filing returns. This change was made last year, when the I-T department did away with the Saral form and replaced it with Indian Income Tax Return (ITR) forms, numbering from 1 to 8. Salaried individuals are largely expected to use either ITR 1 or ITR 2 to file their returns.
In fact, the Central Board of Direct taxes issued a circular (no 6/2008) on July 18, 2008 to reiterate the same. The notification acknowledges that the practice of accepting annexures along with the income tax return form is still continuing. "It has come to the notice of the Board that in spite of the directions contained in the Instructions for filling the return forms, the practice of accepting returns, along with annexures is still continuing. This practice goes against the expressed policy of the government and is not in consonance with the legal provisions," the circular says.
It instructs the chief commissioners of Income Tax to ensure that returns are annexure-less. "It is emphasised that they ensure strict compliance with the provisions of law. It may be reiterated that all annexures accompanying the income tax return forms should be detached and returned to the tax-payers by the receiving official."
So even after this, why is the income tax department still insisting on annexures? "The database recognises only PAN and the companies are not submitting the PAN of all employees. As it's a single database there are multiple people with the same name and hence we need the PAN number. Last year companies on an average had not mentioned the PAN for 50% of their employees."
The million dollar question now is, didn't the taxmen realise these difficulties would crop up when they issued the new annexure-less forms last year? "We have informed our higher officials, who will inform their seniors. We can't directly go to the finance ministry. It will take months for the problem to be notified to the ministry," the PRO said.
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