Introduction: The Chartered Accountants Association, Surat, recently sent a pointed letter to the Finance Minister addressing concerns over errors in the Income Tax portal. These errors led to thousands of notices being erroneously sent out to assessees, leading to confusion and panic. This article dissects the key aspects of the letter, understanding the scope of the problem, and the implications for tax professionals and taxpayers alike.
The Nature of the Error: According to the letter, assessees who are assessed as partnership firms received incorrect notices related to proposed adjustments under section 143(1)(a). These notices, usually received in the late evening, caused unnecessary distress and prompted immediate consultations with tax professionals.
The Issue with Deduction Section 80P: The letter highlights that partnership firms are not allowed deductions under Section 80P, which is only available for Cooperative Societies. The fact that the Income Tax portal could not filter this shows a considerable gap in the system’s utility.
Impact on Tax Professionals and Assessees: The Association mentions that such errors are not only causing financial and legal troubles for assessees but are also wasting invaluable man-hours for tax professionals who have to put in overtime to clarify these misunderstandings.
Interestingly, the letter calls out the Finance Ministry for their “mute mode” in addressing such a mass issue affecting public anxiety.
A Recurring Issue: The letter also emphasizes that this is not an isolated incident. Similar problems have been reported in previous years, reflecting poorly on the system’s reliability.
What the Association Demands: The Association insists that the Centralized Processing Center (CPC) recall such notices immediately and that the Finance Ministry takes necessary action against the software provider to prevent future lapses.
Conclusion: The Chartered Accountants Association, Surat, through its letter, has shed light on a significant systemic issue in India’s tax administration. The flaws in the Income Tax portal have created a ripple effect, causing unnecessary hardship for both tax professionals and the public. The Association demands immediate rectification and assures that such errors should not recur. It now remains to be seen how swiftly the Finance Ministry responds to these pressing concerns.
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Chartered Accountants Association, Surat
Ref: CAAS/Representations/2023-24/02 Date: 01-09-2023
To,
The Finance Minister,
134, North Block,
New Delhi – 110011
Sub: Faux Pas of Income Tax Portal
Respected Madam,
With due respect, it is brought to your kind knowledge that yesterday thousands of assessee across the country, who are assessed as partnership firms (FAS) received notices regarding proposed adjustment u/s 143(1)(a) stating that assessee had claimed incorrect claim. Sample of incorrect claim as stated in the said notices are as under:
Incorrect claim u/s 143(1)(a)(ii)
Such type of notices generated fear in the minds of the assessee and contacting their tax professional to know the facts. Since most of notices were received in the late evening so it was very cumbersome exercise to solace the assessee from the side of the tax professionals.
Deduction of section 80P is not allowed to the assessee being partnership firm, so it is fairly assumed that income tax utility itself will not accept the said return even though some partnership wish to claim deduction u/s 80P of the Act as the said deduction is available only to Cooperative Societies.
For a slightest mistake on the part of an assessee, he is thrashed financially and legally citing negligence in performance of his duties. But for an absolute blunder affecting the mass public and putting them on the edge of anxiety, the mute mode of the Finance Ministry is perplexing.
This is not the one and alone instance but such types of instances were also happened in the earlier years also. Such type of irresponsible processing is not only wasting Lacs of precious invaluable man-hours of tax professionals and assessees, but also blocking the development of the nation to that extent.
Looking to the above, we demand that CPC be instructed to recall such notices immediately. Your office is also should take necessary action on the software provider or other persons in this matter so that such type of hurried and irresponsible instances is not getting repeated in future.
Thanks & Regards,
For Chartered Accountants Association, Surat.
President | Secretary
Copy to: –
(1) Prime Minister, 152, South Block, Raisina Hills, New Delhi – 110011 – for information and appropriate action
