FinMin defends TRP scheme in Delhi High Court

The Finance Ministry has defended its project which envisages training educated youths as Tax Return Preparers, saying it did not infringe on the rights of the Chartered Accountants or other tax professionals.

The Tax Return Preparers (TRP's) scheme has been introduced with a view to help in preparing and filing returns of small, marginal individuals and Hindu Undivided Family (HUF) tax-payers to increase tax compliance, as per the affidavit filed by the ministry in Delhi High Court.

This affidavit was filed in response to a PIL challenging the scheme introduced by the ministry to assist tax-payers in filing their returns. The petitioner, a Chartered Accountant, had sought directions from the court to the ministry to stop the scheme.

The Court, on November 20, had issued notices to Finance Ministry and Director General of Income Tax

The affidavit submitted that the scheme was as per the provisions of Section 139B of Income Tax Act. There was no challenge to this section and no public interest was involved, it said and argued that the PIL should be rejected.

The ministry's document said that none of the statutory functions of Chartered Accountants have been affected with the launch of the TRP scheme as preparing and filing of IT return was not a statutory function of CAs alone.

Section 139(1) of the IT Act casts a liability or onus on an assessee to prepare and furnish IT return by himself or by getting it prepared and filed through any other person, including a professional like CA, advocate or IT practitioner. Therefore, the assertion that only CAs were authorised to prepare and file IT returns was incorrect, it said.

The affidavit, added that a committee appointed by CBDT had submitted that 80 lakh tax payers had stopped filing returns as they found the process cumbersome. Hence, a simpler mechanism needed to be evolved which could help these individuals to file returns.

As per the scheme, graduates in commerce, law, economics, mathematics and statistics will be trained as Tax Return Preparers by the I-T department in collaboration with NIIT in a nine-day training programme.

About 5,000 TRPs were to be trained on a pilot basis from this financial year at 100 centres across 80 cities.

The petitioner had contended that the scheme encroached on the jurisdiction of Chartered Accountants, and claimed they alone were eligible to prepare tax returns.

The TRP scheme envisaged a mere nine-day training to graduates, who would practice as CAs in filing returns with the Income Tax Department, thereby giving a go-by to the canon and law in its true spirit, the petitioner had argued.

Terming the very scheme contrary to the provisions of Chartered Accountants Act, the petitioner had contended that its implementation would render CAs jobless.