Plans ‘zero-delay regime’, fixing of responsibility and accountability in case of any lapse.
Worried over delays in disposal and inept handling of cases related to income tax by its officials, the Central Board of Direct Taxes (CBDT) is concretising a strategy to streamline litigation management.
The board is taking measures to ensure ‘zero-delay regime’ in filing appeals, fixing responsibility and accountability of officials in cases of lapse without reasonable cause and expediting disposal of cases at the commissioner (appeals) level, according to action plan targets, both in terms of quantity and quality.
New instructions on engagement of counsels to represent I-T department’s cases and on filing of appeals in high courts and the Income Tax appellate Tribunal (ITAT) in the form of standard operating procedures are also in the offing.
A senior CBDT official told Business Standard that the fees paid to the counsels were expected to be raised and counsels with income tax background could be utilised extensively.
He added the steps envisaged to improve litigation management would ensure judicious functioning in the department, leading to smooth collection of due taxes without undue botheration to assessees.
Finance Minister Pranab Mukherjee has raised serious concerns on the rising number of litigation and has asked the department to take immediate steps to streamline the system. The finance minister stressed at the conference of chief commissioners and director generals of income tax last month that pending litigation, especially before CIT (Appeals) and ITAT needed immediate attention.
As on March 31, 2011, Rs 77,000 crore of demand was pending before CIT (Appeal) and almost Rs 96,000 crore before ITAT.
The average time taken for disposal of the first I-T appeal in India, at 14 months, is much higher than the best international practices of less than 6 months. The total number of new appeals in a year at present is higher than the number of cases disposed off at the level of the commissioner (appeals).
Similarly, ITAT, considered the final testing ground for all efforts of the department in relation with investigation and assessment, the CBDT official said general experience indicated that success ratio of the department was very poor.
The primary reason for the poor success rate appears to be filing of appeals in a routine manner, without proper analysis. Excessive work load on officials, lack of training, adequate facilities and timely assistance from field formations have been identified as reasons for this kind of performance.
The problems identified at the high court and Supreme Court levels include undue delay in filing of appeals; filing of defective appeals and delay in rectification; filing of appeals in high courts even when substantial question of law is not involved; lack of proper and timely briefing to counsels; and of due care and caution while selecting counsels representing the department.
