MINUTES OF THE MEETING OF REPRESENTATIVES OF ASSOCIATIONS OF TAX CONSULTANTS WITH CHIEF COMMISSIONERS OF INCOME TAX

The following Officers attended the meeting:

1. Shri T K Shah – CCIT-V,Mumbai; Chairman
2. Shri S Ravi – CCIT-XI
3. Shri P C Srivastava – CCIT~VII
4. Shri Swatantra Kumar – CCIT-XII
5. Shri A K Mehrish – CCIT-XIII
6. Shri A C Shukla – CIT (TDS)
7. Shri Sandip Pradhan – CIT (CO)

The representatives from the associations of tax consultants present in the meeting were:

1. Shri Deepak R Shah ? Vice President, BCAS
2. Shri Kishor B Karia ? Chairman, Int. Taxation Committee, BCAS
3. Shri Gautam S Nayak ? Chairman, Taxation Committee, BCAS
4. Shri Vipul B Joshi ? Chairman, Law and representation Committee, CTC
5. Shri Mahendra Sanghvi Co-chairman, Law and Representation Committee CTC
6. Shri S M Bandi ? Vice-chairman and Representation committee CTC
7. Shri Apurva R Shah ? Convenor, Law and Representation Committee, CTC
8. Shri Anil Doshi ? Convenor, Taxation Committee, BCAS

The issues proposed by the associations for discussions included the following.
1. Rectifications and Appeal Effects.
2. Stay of demand and coercive action for recovery.
3. Credit for TDS.
4. Interest under section 244A.
 5. Revalidation/re-issue of Refund Cheques.
6. Adjustment of refunds against old demands.

On
preliminary discussions between the participants, a general consensus
emerged that having regard to the accumulated huge volume of work
involved in the list of issues to be resolved, the Department needs to
take up one important aspect of work at a time instead of dabbling with
all matters simultaneously, review the progress in the next meeting and
move ahead for resolution of other issues. It was also felt that the
foremost need is to correct the demand uploaded by the AOs on to the CPC
server which is otherwise resulting in adjustment of refunds against
non-existent/excessive demands.-

In this background, the issues that were discussed in the meeting are as under:

 I   Correction of Demand uploaded on CPC Server

Shri
M B Sanghvi stated that refunds due to the taxpayers are often not
issued as the AOs have uploaded incorrect demands on to the CPC portal.
Shri Swatantra Kumar explained that there were a few system related
problems earlier. These problems have been resolved and the officers are
now in a position to correct the demand. Shri T.K. Shah informed the
participants that the CCIT-I, CCIT-II and CCIT-X have already appointed
their AC/DCsIT(HQ) as Nodal Officers in their Regions to receive
applications regarding objections to the arrears of demand intimated by
the CPC to the assessees. To start with (upto 30th June, 2012)
applications for correction of such demands which are shown outstanding
on account of following reasons alone will be made by the taxpayers.

(i) Multiple demands for the same assessment year such as demand raised under sections 143(1), 143(3), 154 etc.

(ii) Demand reduced/cancelled on account of rectification/appeal effect orders already passed.

(iii) Demand on account of adjustment of refunds or not allowing credit for TDS and taxes paid.
(iv) Demands in respect of which intimation/ order/demand notice not served

The
scope of the matters covered by the applications to be received by the
Nodal Officers, as aforesaid, needs to be clearly understood and
explained. After 30th June, applications in respect of demands intimated
by the CPC other than those specified above at item nos. (i) to (iv)
may also be made to the Nodal Officers. [Action- All Associations of Tax
Consultants]

Consequent to the discussions in the meeting,
other CCs lT have also passed the orders appointing Nodal Officers. List
of Nodal Officers appointed by the CCs lT is enclosed herewith. It was
clarified that Nodal Officers will not be appointed for CIT charges
located in BKC and Vashi as they will/are being served by Aayakar Seva
Kendra (ASK). Shri S Ravi suggested that the Chartered Accountants/
Advocates may make available the list of rectifications (if they are
more in nos.) in excel format along with applications, so that the same
may be uploaded to the CPC by the AO. Modalities for implementation of
this suggestion need to be discussed and finalized. [Action- Shri S Ravi
and representatives of Associations of Tax Consultants] Shri T K Shah
proposed that second fortnight of June will be devoted to corrections in
demands, as aforesaid, which was found acceptable by all the
participants. He further suggested that the clearance period may be
given wide publicity by the Department/Tax Consultants Associations.
[Action- All Associations of Tax Consultants]

The format to be
used by the assessees for making applications for correction of demand
devised by the Associations is enclosed. II TDS Mismatch Shri Kishor B
Karia, stated that in a large number of cases, credit for TDS is not
given as it does not appear in Form 26AS. He raised the issue that if
the assessee makes an application regarding TDS mismatch, whether the
Income Tax Department can take action against the deductor. He further
suggested that

(i) the reasons for non-grant of credit must invariably be given along with the relevant order/intimation and

(ii)
detailed guidelines should be issued for claims in respect of TDS
credits in cases where amount does not appear in Form 26AS. In response
to the same, Shri T K Shah stated that there were various improvements
under consideration and were being looked into. Since under the existing
instructions, in a case where amount of TDS is not reflected in Form
no. 26AS, the AO has to allow credit after “due verification”, reference
will be made to the CBDT to issue guidelines with regard to what
constitutes “due verification” for this purpose. [Action – Shri T K
Shah] Shri A C Shukla stated that for F.Y.2007-08 and 2008-09, large no.
of statements/returns were pending due to mentioning of wrong PAN,
Section, AY. etc. by the tax deductors. The deductor has to file revised
statements to sort out this problem. Regarding 26AS, he further
requested the representatives to sensitize the deductors about proper
deduction and uploading of TDS statements/returns. It was decided that
the common reasons for mismatch of TDS may be compiled by the CIT (TDS)
and annexed with these minutes. The CIT (TDS) has since done that. A
copy of the common reasons compiled by him is enclosed (not printed
here). [Action- All Associations of Tax Consultants]

Another
problem pointed out in this regard was that TDS certificate cannot be
generated from TIN centre in a case where PAN of the deductee is not
available. Shri A C Shukla stated that this problem has been taken up
with the DGIT (Systems), New Delhi. Shri Swatantra Kumar informed the
participants that with issue of TDS certificates from TIN, this problem
will no longer be there.

III. Rectification & Appeal Effects

Shri M B Sanghvi requested that each and every officer should maintain a separate register for such applications (for matters other than those where applications are made to the Nodal Officer in respect of demands intimated by the CPC) which should bear a separate acknowledgement number. This suggestion was found acceptable by the par-ticipants. Instructions to this effect will be issued to the AOs other than those served by ASK.
[Action – All CCs lT]

IV.    Re-issue/Revalidation of Refund Cheques

The Members stated that in many cases, refund cheques are not sent in time and are received by the assesses few days before their expiry dates and at times after the expiry dates. The representatives stated that the new procedure of issuing new refund cheque delays the matter and suggested that the rules should be amended to permit revalidation of cheques. It was clarified that in view of the guidelines of the RBI, reverting back to the process of revalidation is not an option. To eliminate this problem, Shri T K Shah suggested that the Associations should educate/ encourage the assessees to opt for receipt of refunds under ECS and furnish relevant bank ac-count details in the return itself.
[Action – All Associations of Tax Consultants]

Regarding issue of refunds, Shri Sandip Pradhan suggested that if there is change in address, the assessees should be advised by the associations to get PAN data immediately updated otherwise the refunds cheques are returned unserved.
[Action- All Associations of Tax Consultants]

V.    Migration of PAN and Jurisdiction of the Assessee

The representatives of associations stated that during the process of PAN migration, some clerks do not accept the returns in new jurisdiction as per the Notification of jurisdiction on the ground that the PAN is not migrated to their jurisdiction. They suggested that the clerk in new jurisdiction should accept returns in such cases. Shrl Sandip Pradhan clarified that the assessees have option to file return in either of the jurisdiction. Shri P C Srivastava suggested that it will be advisable if the return is filed in new jurisdiction and is accompanied by a copy of the application addressed to the AO in old jurisdiction for migration of PAN to the new jurisdiction.
[Action- All Associations of Tax Consultants]

It was pointed out that the AO does not send intimation to the assessee at the time of migration of PAN. Shri Sandip Pradhan clarified that the assessee can always know the change jurisdiction/AO online.

Regarding PAN migration, the CIT(CO) suggested that the matter pending before the old AO should be resolved first. Only thereafter the system allows migration of PAN to the new AO.
[Action- All Associations of Tax Consultants]

VI.    Stay of Demand & Coercive Action for Recovery

The representatives stated that very large demands have been raised upon completion of the scrutiny assessments and coercive action is taken without giving the assessee adequate opportunity to even approach the concerned authorities for stay of recovery of demand. Shri Vipul B Joshi suggested that the bank accounts should not be freezed, if stay application is pending. In response, Shri T K Shah stated that there cannot be any specific guidelines and as facts of cases vary, a decision requires to be taken by the officer concerned. The department also has its administrative Instructions to follow. Shri P C Srivastava stated that there is a Board Circular No.1914 which is followed in such cases.

On the issue of action during the pendency of stay application, it is also a fact that the assessees go on making applications for stay at various levels when application is rejected at one level. It may not be workable option not to take action for recovery during the course of pendency of stay petition at level higher than that of AO. It was agreed that this issue will be discussed in next meeting.

VII.    Interest u/s. 244A

The representatives brought to the notice of the Department that the AO is issuing interest u/s 244A till the date of intimation/order, but in fact, the assessee is getting the refund cheque only after 3 to 4 months from the date of intimation/order. In response, Shri T K Shah stated that in many a case, the delay is due to absence of details from the assessee and that under the law the AOs are required to grant interest upto the date of issue of refund.

Conclusion

Shri T K Shah thanked all the participants for their presence and participation. It was agreed to hold next meeting in the first week of September, 2012.

The meeting concluded at 5.30 pm.

(T K Shah)
Chairman and
Chief Commissioner of Income-tax- V,
Mumbai

22.05.2012