The new Income tax bill, 2025 is now reality with proposed implementation from thee F.Y 2026-27 replacing the existing income tax act, 1961 with avowed purpose to simplify the most complex direct tax present form of laws to the tune of easy to do business and reducing the litigations. Since income tax law is pivotal and all in all on controlling the every aspect of financial activities not only of a nation specified but with equal impact upon a nation external trading and other financial intercourses apart from the chief instrument of social engineering by maintain income equality crucial for a national economy and fabric. Now DTC is in un amended form is very much available to all stake holders with invitation from the mandarins of North block to advance critical and valued suggestion to make it more versatile and an engine of fast growth of national economy. Now in this perspective some crucial question automatically arise for practical deliberation about the future impact of DTC as:
1. After going through the DTC bill at a glance, it is opaque like a day that it is a copy and paste of the existing act in a more scattered forms with same linguistic trail only with minor difference of shorter forms of the sections unlike of present cumbersome forms of section with numerous provisos, explanations, clauses, sub clauses being detrimental for easy understanding of both domestic and foreign enterprises particularly. Now first question is how long will it be slimmer forms for easy understanding? Legal history shows that every Act after it’s new enactment was in slimmer form and then gradually become heavier by numerous amendments for effectual implementation of that law as well as to implement or circumvent the impact of judicial decisions and when the issue is income tax law which itself a complete code itself then it is tom foolery to envisage it as a simple literature as like the screen play of a Hindi or any our other regional popular masala movies or a news paper or channel reporting. There have been two simple reasons behind it. One is the jurisprudence related theorems just like physics, math, chemistry, computer science or even more complex and secondly finance itself is highest of complexities and to cope with it’s whimsical course income tax rotates equally in tandem. As a result with passage of time DTC too after 15 years will be much more heavier that present regime since t contains 73 more sections than present Act apart from cascading effect of future judicial dictums.
2. That the next million dollar question is will DTC revamp the collapsing direct tax administration being yoked with millions pending appeal which will soon be triple due to surge of mechanical additions by the assessing authority with conscious aim of govt. to make the refund adjustments of subsequent years , an easiest feeder for narrowing the burgeoning revenue deficits. So the answer is negative.
3. Will DTC help govt. to augment the revenue collection and taming the skyrocketing black monies by undertaking sufficient surveys, scrutiny, searches which are almost at breaking point in 80% tax zones in India due to serious staff shortages for the reason of govt. inability to foot the absurd high salary bill and this peril started as early from 2000 and is now in maturing point. Even on hypothetical basis if it is accepted that very soon robot ITO,s, inspectors will supplement the manpower gap taking note of govt. high optimism on AI, then too it has to wait at least 10 years or more and the fast growing chasm of revenue deficit most probably will fell flat our govt. before the robot officials flat the truant assesses. More interesting thing will be seen soon how these spate of foreign investments in domestic industries will cope with this infamous collapsing tax administration, historic pendency of appeals, most illogical assessments which will continue without an iota of doubt for gobbling refunds t keep the economy afloat somehow if and understaffed judiciary which is one of most crucial element for survival of a business.
4. That DTC is introduced for easy to do business and govt .is prompt to bring it in to reality as copy and paste is easiest in digital age but digitalization and the efficient running of digital infrastructure is a billion dollar question and no further delineation is necessary to the stake holders in direct taxes hopefully and adding to woes the thumping efficiency of present dispensator on digitalization is being self mirrored from the the pending efiling and e proceeding of just 31 benches of ITAT, the most crucial forum in direct tax administration since 2022 March deadline( now omitted both in income tax act and DTC at last) .
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