We, in our country, have very specific set of law makers and they make the rules and regulations, specially the rules and regulation affecting the Tax payer public in a very strange way. Sometimes they brought a  new of rules and procedures in the name of tax reforms and user friendly and then in a year or two they revert back to the more stringent procedure and this practice is continue since year to year and nobody is there to stop this system of  “trial and error Method” which they are  practicing in search of excellence at the cost of  Tax payer public.

Now they have introduced a new system of filing of ITR in case of audited assessee in which CAs has to E-files the audit report and then assessee approve it and after that the ITR can be e-filed by the assessee. Further the CA has to E-file the Balance sheet and profit and loss account also. I practiced this system and it is very interesting system but what about wastage of time and resources. Once we have a system in which the return and audit report both have to be filed though it was in paper format and then suddenly they brought a law in which No audit report was required to be filed. The return was called paperless return and in that system all the figures of Balance sheet and profit and loss account are required to be filled in return itself and further the ITR also required most of the features of the form 3CD also (with some exceptions). The return especially ITR -4 become a cumbersome activity but now the professionals have adopted it successfully in last two years.

But now see in case of Audited returns what they have done? Now you have to file the audit report and financial statements in the form of 3CD/3CB, profit and loss account and Balance sheet and also filled the figures of Balance sheet, profit and loss account and 3CD  in the ITR also. What is this? If they want the Audit report and financial statements to be E-filed then they should have done away with the compulsion of filling the figures of Profit and loss account and Balance sheet and 3CD  in the ITR by introducing a very simple return for the Audited assesses.

The law makers might have the compulsions for introducing the new system and Nobody should question (Who can?) their right to introduce a New and sophisticated system but where is the logic in seeking the Double information at the cost of time and resources of professionals and assesses.

Practically this is the system in which our law makers have the habit to work. They first abolish the Gift tax and then suddenly brought it back and now adding one or more thing to it every year (See lot of additions to Section 56(1) (vii). They introduced two most complex form of tax in the name of FBT and BCCT and then one day they realized that it was a mistake and taken back.

What is the purpose of making the taxation law and changing them every year? The case of ITRs which we are seeing in last 10 years is a good sign of indecisiveness on the part of Law makers. First they have average 10 pages return forms and then they gave us only one or two page return forms and then again they increased the size of the return to unlimited pages. Is there any connection between the collection of the revenue and the size of return forms?

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CA Sudhir Halakhandi – CA Abhas Halakhandi

“Halakhandi”, Laxmi Market, Beawar-305901(RAJ)

Cell- 9828067256, E-Mail – sudhir@halakhandi.Com

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0 responses to “New System of Filing of ITR- A Total Reversal of Taxation Reforms”

  1. K.MUKAMBIKA says:

    With the mantra of security, e-filing procedure under Income-Tax Act are made more complicated. Because of professional bodies ethics of mandatory to seek permission from earlier auditor, assessees can not change auditors even though such change badly needed in view of bad experience with the earlier auditor. Now, security aspect in e-filing website will give boost to such act of auditor & assessees are put in cage.

  2. B.S.K.RAO says:

    IN 1947 INDIAN RS 1/- WAS ALMOST EQUAL TO $ 1/-, NOW RS 60/- IS EQUAL TO $ 1/-. SINCE 1947 MAJORITY OF THE PERIOD WERE RULED BY CONGRESS GOVT. HOW CONGRESS GOVT. DESTROYED THE ECONOMIC SITUATION OF INDIA. AT LEAST IF GOVT. RESPOND TO WRIT-UP SUGGESTIONS OF CITIZEN CORRECTING THE SITUATION AGAINST SUCH WRIT-UP SUGGESTIONS, SITUATION MIGHT HAVE IMPROVED. THIS IS ALL BECAUSE OF ARROGANT IAS & IRS OFFICERS IN THE GOVT. DEPTT. CAN WE NOW SAY THAT OUR ECONOMY IS DEVELOPING OR DETERIORATING. IN FACT IN MY OPINION IF WE STILL ALLOW DEAD CONGRESS GOVT. TO CONTINUE, INDIA WILL BE PUT UNDER DEBT TRAP & OUR ECONOMY WILL BE IN THE HANDS OF VESTING INTEREST & BUREAUCRATS. SOME HOW POOR PEOPLE WILL MANAGE, WE THE MIDDLE CLASS PEOPLE WILL HAVE TO SUFFER.

  3. som says:

    I feel that most of the government orders are the outcome of low profile employees without foresightedness, and are amended and clarified every now and then. Rules are made for breaking it. Some laws appears to be made to protect offenders. Government always try to increase its revenue by imposing indirect taxes on people, without any logic. It could not do any thing to curb black money due to lack of honest machinery, on the contrary they try to harass honest people. The problem is, where we will get honest and sincere government employees? Can we import them? Can the corrupt public be tamed to honest citizens? No, all these are simple illusions. Majority of corrupt citizens and politicians are not an asset but a liability to the country. They can do any thing to against the national interest. Thinking of any revolution in the near future will remain a dream for ever.

  4. S.P. Manchanda says:

    You must be aware that the Govt. nationalised 14 + 6 banks in 1989-90 in the name of social sector to help aam-admi. After elections, the Govt. took a U turn and started encouraging privatisation and outsourcing of banking work. Now there is no social banking and there is only profit motive.

  5. n.srimolalingam (income tax practitioner) says:

    when the department wants to paperless proceedure, then it going on combursoming work and imposition the same work. and every year changing of it is very difficult and wait for filing the return new format because there is dealay in compling the format in excel.

  6. B.S.K.RAO says:

    S C Kapur Sir,

    I also wrote to Deptt. of Administrative Reforms & Public Grievance about status of Central Board of Direct Taxes & its disability to administer Income-Tax Act. I think they are also not concerned about the matter. What is next ?

  7. B.S.K.RAO says:

    In western country’s around 70% to 80% of population under tax net. I have furnished copies of Income-Tax returns of Australia, Malaysia, United Kingdom & USA etc. to Sri Rajesh Kumar Bhoot, Director (TPL-III)CBDT & Sri.J.Saravanan US(TPL-III) CBDT & Sri.Ashish Abrol, Addl.Director of Income-Tax. I have also explained in detail how compliance under Income-Tax is sought in western countries & reasons for stagnation of tax base in India. I feel that all my papers & documents in the above matter has been brushed aside. The fact is evident from the e-filing website of Income-Tax Deptt. I think they are all influenced by vested interest who are not concerned about India.

    • ASHWIN GALA says:

      You are right. They are not just influenced. They are carried away by vested interest. They do not care about India & Indian public.

      CA ASHWIN GALA

  8. Anruddh Goel says:

    The Form 3 CB, which is required to be uploaded by the professional, does not contain the statements which are otherwise required to be incorporated as per the Auditing Standards laid down by the ICAI. Unless the Form 3CB, as available on the e filing site is amended, the professional is in peculiar situation as to how to comply with the guidelines laid down by the ICAI. ICAi should first of all take up the matter with the CBDT for amendment in Form or should come out with the guidelines to members ass to how to comply with the SA700, 705 etc in case of Form 3 CB.

  9. K.MUKAMBIKA says:

    Finally,

    I feel that our Central Govt. does not wants Revenue, but only records fabricated by the assessee for tax purpose.

  10. B.S.K.RAO says:

    I HAVE ALREADY CONVEYED THE PROBLEMS OF E-FILING TAX AUDIT REPORTS IN DETAIL TO ONE SRI.RAJESH KUMAR BHOOT, HEAD OF TPL DIVISION IN CBDT. MANY OF MY GRIEVANCE BEFORE CBDT IN THE MATTER ARE SUBJECT TO RTI APPLICATION, WHICH ARE IN THE STAGE OF 2ND APPEAL. IN SPITE OF THESE EFFORTS CBDT/MINISTRY OF FINANCE IS DUMB & NOT TAKING ANY ACTION IN THE MATTER. I DO NOT KNOW WHAT TO DO NEXT ?

    • ASHWIN GALA says:

      MR. B.S.K. RAO,

      THIS IS REALLY ALARMING ! YOU HAVE SO MUCH FOLLOWED UP WITH CBDT. AND NO REPLY ?

      ALL TAX PRACTIONER ASSOCIATIONS ETC. SHOULD TAKE UP THIS SERIOUSLY. THE MATTER SHOULD BE TAKEN UP BY PRESS ALSO. CAN YOU DESPATCH YOUR DETAILS TO PRESS & ASSOCIATIONS ?

      ASHWIN GALA

  11. Mahendra Bagrecha says:

    Dear sir,
    I totally agree with your views. This process is going to increase time consumption in filing ITR and it is also possible that IT dept website will get jammed etc etc…

  12. Ashish gupta says:

    This is very great, appreciating & alarming topic raised by the author. We being the carrier of tax laws in the country, knows the ground reality of the effect caused by any changes in the reforms. It takes much time to practically understand any new provision or rule and by the time you adopt it, there is further amendment in it. Why can’t we have the simpler tax regime so as to make the tax compliance a hassle free task.

    Frequent amendments in tax laws raises uncertainty about the net margins from any new venture in India and sends negative signals to foreign investors. It is only we, who have to take the responsibility to raise voice against such governmental practice & bring change through various business chambers / associations /  institutes.

  13. Manoj says:

    Really the income tax department is not doing the good things, they should really work for simplicity in tax compliance procedure to be adhered to by the public. Public at large should react to all those type of useless things, even we all should take a decision not to file a single return and protest the situation. If no tax will be paid and no return shall be filled GOVT. will definitely think to have a change in the system. If this can be done then only real protest can be shown to the GOVT, I think so.

  14. CA PRAKASH D SHAH says:

    Bahut hi galat ho raha.Ek hi data to kitini bar deparment of hum dete rahange.In returns of Excise ,VAT,ITR,Service Tax, Cost Audit,Custom and in most of the cases,its assessment,reassement,revision.

    It is now too much.

  15. ashish goyal says:

    good evening sir,

                         sir I want to know that which F.y. this new audited e-filling Itr Provision Applicable 

  16. B.Chakrapani says:

    Read the article. I call these type of reforms as ” bureaucratic imprudence”.

  17. murali says:

    SIR

     WE  ARE AT THE RECEIVING END ALWAYS NO MATTER WHICH PARTY IS AT THE CENTER
    FOR PROFESSIONAL LESS SAID THE BETTER

    YOU HAVE TO HAVE MONEY POWER COUPLED WITH MUSCLE POWER TO SURVIVE

    MURALI

    CHARTERED ACCOUNTANT 

  18. Satyanarayana says:

    I appreciate you addressing the pains in this matter. Forget about the pain, it is so pathetic that the officials are not bothered about the contents of the form. Please check the deductions mentioned in drop down box of chapter VI A. Stangely, you dont find 80TTA, introduced newly for interest on Savings Account in the list of deductions under chapter VI A. You find all very old dedcutions. We are forced to ignore this section. But finally we are blamed for wrong attest functions.

    CA Satyanarayana

  19. B.S.K.RAO says:

    DEAR MY FELLOW TAX PROFESSIONALS KINDLY FOLLOW BELOW SUGGESTIONS
    TO MEET THE PROBLEMS CREATED BY THE INCOME-TAX DEPTT.

    1. File return online in 44AB cases without putting tick in the box provided
    2. Immediately file ITR-V to local income-tax office along with Physical Tax
    Audit Report

    Here you can also avoid scrutiny under CASS, because you know that majority of cases
    selected for scrutiny are 44AB cases

    This is the only solution against the policy of CBDT/Ministry of Finance who is not sensitive enough to understand the tax payers grievances. Ministry always work in the interest of Bureaucrats & Vested Interest but take vote from us.

  20. Nipun Jain says:

    The frequent changes in procedures clearly shows confused state of mind of the very persons who have been entrusted the task of stabilizing the administration and economy. There are no two views that the administrative machinery has grossly failed to achieve its purpose and is only an harassment to honest taxpayers.

  21. k c agarwal says:

    i want to draw your kind attention to the previous I T R forms ,in which it was to filled the name of the auditor, M.N. NUMBER,and the date of signing the audit report. And of cousre in most of the cases, the return is being filed by the lawer of the assessee. The department has the confidence on the professional. In some cases,it also happend the books of account is handedover to the lawer to get the audit from C A and file the return. It is very schoking nesw that 696 false membership number were noted in the retutn. 420 membership of decased members were noted, moreover it was found that more than 10000 members had conducted more than specifid limit. Now who it is very difficult to decide who is responsible for such type of fraud. The facility given by the borard has been misutilised. I FEEL THAT C B DT HAS BEEN COMPELLED TO TAKE SUCH TYPE ACTION. I will request to Mr SUDHIR , PLEASE EXCUSE ME FOR SUCH TUPE COMMENT

    C A K C AGARWAL. ALLAHABAD

  22. Somanchi says:

    You are right. With this system of Tax laws and procedures, people will stop filing the reruns and they answer the tax people when ever they approach. They think of crossing the bridge, when ever they arrive

  23. S C Kapur says:

    On daily basis laws are being changed. What to talk of Babus even most of the Senior Officers do not apply their mind. Same is the case with Ministers. When Minister make statement with double standards. Sometimes they themselves are not clear whether such statements are in official capacity or personal or political. In all circumstances public is made to suffer. Public is made to pay through their nose. It is high time for Ruling as well Oppositions to identify what is good for citizens of India. Most of us are living under miserable conditions whereas less than 1% of population is holding more than 99% wealth and sources of the country. Manipulators are making money whereas all other are suffering. We fail to understand why laws and various forms of Rule and Regulations are being changed so often. Central Govt is not listening. Opposition is not allowed to speak. Where one should go. We will continue to suffer unless some administrative reforms are brought in and implemented in a year or so.

  24. S Balasubramanian says:

    The law makers may be sincere; but the executing departments are not.  They find that their importance is going down with electronic filing and issue of refunds direct to bank accounts.  Therefore, they will try and introduce complications at every conceivable point.  Reforms are a tough road to travel.  Indian Government have to move on positively; Indian Public has to endure more patiently.

  25. B.S.K.RAO says:

    I AM WRITING TO CBDT MINISTRY OF FINANCE HIGHLIGHTING THE PRACTICAL PROBLEMS THAT WE ARE FACING BECAUSE OF NO CORRELATION BETWEEN CPC & LOCAL INCOME-TAX OFFICE SINCE PAST 4 YEARS. I FEEL CBDT IS DUMB & NOT SENSITIVE ENOUGH TO UNDERSTAND THE PROBLEMS FACED BY THE ASSESSES. IN INDIA WE WANT DICTATOR LIKE MR.YEDURAPPA IN KARNATAKA TO GET THE JOB DONE FROM IAS OFFICERS. IAS/IRS OFFICERS SIT IN CLOSED DOORS IN AC ROOM, THEY CAN NOT UNDERSTAND WHAT IS THE REALITY AT GROUND LEVELS.

    HAT’S OFF TO YEDYURAPPA, EX-CHEIF MINISTER OF KARNATAKA. WE PEOPLE OF KARNATAKA SAW VERY GOOD DEVELOPMENTAL ACTIVITY IN KARNATAKA IN HIS REGIME. HENCE, WE WANT PERSON LIKE YEDYURAPPA IN THE CENTRE TO CORRECT ALL THE PROBLEMS. CONGRESS GOVT. IS ALMOST DEAD & THEY CAN NOT REGULATE IAS/IRS OFFICIALS IN THE INCOME-TAX DEPTT. TO CORRECT THE PROBLEMS

  26. N.UDAYASIMHA says:

    Probably all those tax professionals who are filing returns for their clients have to acquire a high speed,multipage scanner.
    N.UDAYASIMHA

  27. DEEPAK SONI says:

    The law makers are not only ignorant but they are also highly arrogant  , strongly prejudiced against the  tax payers and also corrupt. This combination of three vices have created havoc for the tax payers.The ministers and the bureaucrats will have to change their approach and only then there will be improvement in the system . However there is no such chance in the near future unless there is a revolution and this useless lot is thrown out.The ministers and the Indian BABUS do not understand the innumerable difficulties the business community is facing.They indulge in the criminal wastage of the hard earned money contributed by them to exchequer by way of taxes.

  28. Divyesh Parekh says:

    I agree with CA Halakhandis. The manner and the rate at which the Taxation Laws in India are being amended is a cause of deep concern with the general Public as well as the consultants. Our Ministry of Finance, since last about 10 years, had been boasting of trying for simplification of the Tax Laws, especially the Income Tax Act, but today these laws are made more and more difficulty to comply due to frequent changes without giving proper thought to the schema of things.

  29. ASHWIN GALA says:

    Deep concern of CA Halakhandis is very much appreciable. In fact it is of deep concern for General public of India. The lawmakers have created complete mess. They have created forest of  laws in which general public gets confused & lost. They want all information on their Tip at cost of hardships to public. They have misused Technology for their own benefit at cost of harassment of public. They want to create a system where BABUS have no responsibility but all authority.
    For this they have set up system of lots of compliance s on part of public. A small lapse ( sometimes even practically inevitable) makes public liable for interest, penalty, late fees & so on. Public energy gets wasted in all such non creative , non productive efforts. Efforts of Anna Hazareji & Arvind kejrival etc has failed. It is high time that public should revolt against this.
    Else our lives are miserable 

    CA ASHWIN GALA

  30. B.S.K.RAO says:

    TO CBDT/MINISTRY OF FINANCE,

    Who will make investment in India wherein laws are frequently amended making it more & more complicated with the mantra of simplification. I personally advise Ministry of Finance look at the other country’s website & follow it, if you are unable to make assesse friendly procedure to meet compliance under taxation laws.

    As per my knowledge, Congress Govt. in the centre is not alive on date to hear the hue & cry of assesses & tax professionals.

  31. DEEPAK says:

    Yes u r right but no one (CAs’ & Assessees )care about this. Hum par jo thopa jata hai hum Indian use chup chap sweekar karte hue mushkile jhelte hai par awaaz nahin uthate

  32. D. Narayanan says:

    Sir I agree with you.   Instead of going to nonfiling & tax evading people the are after loyal tax payers. Making combersum system will corrupt the dept.  and even honest tax people will evade tax.  May be what we pay is not enough to pay and maintain their staff.

  33. Ravindra says:

    As technology improves and data storage can be immense , e-filing of supporting documents will only increase and this is not to be confused with simplicity of forms .       

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