Joint Representation Letter of CA’s in Thanjavur, Thiruvarur, Nagapattinam, Mayiladuthurai and Cuddalore Districts. CAs wrote to FM on the difficulties faced while using the new Income-tax e-filing portal and Request for waiver of late filing fees, penalties, interest, etc.,
09th January 2022
To
Smt. Nirmala Sitharaman
North Block
New Delhi 110 001
Dear Madam,
Sub: Representation of difficulties faced while using the new Income-tax e-filing portal and Request for waiver of late filing fees, penalties, interest, etc., in this regard
Introduction:
We are practising Chartered Accountants in the rural areas of Thanjavur, Thiruvarur, Nagapattinam, Mayiladuthurai and Cuddalore Districts in the state of Tamil Nadu. The total strength of the Chartered Accountants in these areas is around 180. Here most of the assessees are not tech savvy to file their income tax returns on their own and also, they are not much aware about the current provisions of the Income tax act.
We, the practising chartered accountants, act as a bridge between these assessees and the government, highlight to them about the taxation laws and benefits, the government has introduced for them.
As there is a saying that Chartered Accountants are partners in the nation building, we the CAs in these districts have really worked hard towards nation building. We educate the people the importance of compliance with tax laws and the need for them to contribute to the nation.
We being from Tamil Nadu are always law abiding and have not made any representation in the past for any extension of due dates or any other reason for the time being.
This being a unique year with both covid pandemic and introduction of new income tax e-filing portal, we have been forced to represent before your Hon’ble self on behalf of our clientele consisting of many small taxpayers, MSMEs and Trusts.
Facts of the Representation:
As you are aware, since March 2020 we have faced a lot of lock downs and business disruptions due to the onset of covid 19 pandemic and we are really thankful for the measures taken diligently by the PMO, Finance Ministry and Health Ministry such as PM Gareeb Kalyan Scheme, allowing to file Income tax return of AY 2019-20 upto 30th June 2020 and of course the massive vaccination drive.
Inspite of the fact that the Government has taken all the steps necessary for the smooth functioning of business, the compliance burden has increased threefold among the business people like filing income tax return, faceless assessment, monthly GSTR1 & GSTR 3B returns, Annual GST Returns and Reconciliation Statements, PF Returns, Company law returns and so on.
We would like to bring to your kind notice that these kinds of rural assessees are much dependent on us for all these statutory compliances right from getting PAN card to file income tax returns.
1. Second Wave of Covid 19 Pandemic
The second wave of Covid 19 pandemic was very severe in our areas and we lost 2 chartered accountants from our branch and many staff members in the offices of the chartered accountants and the assessees. When a death happens in an office, the morale of the entire office is lost and bringing back the employees to work becomes a herculean task.
The entire state was locked down during the month of May 2021 and June 2021 and we cannot say that we resumed to work with full enthusiasm from July 2021. There was frequent infection of Covid in our offices and client offices and the key persons getting infected, their isolation and slow recovery has created lot of havoc amongst us.
Further due to the aftermath of COVID-19 first wave and the perilous second wave the business entities are strenuously held up in the difficult task of promotion of the business, securing the clients and customers, generation of revenues, coordinating the staff and employees for the business operations and administration of the entity and ensuring their safety, arrangement of working capital funds for the operations, and arrangement of funds for payment to the employees, suppliers, vendors, government agencies and bankers.
Further, in these districts, the work from home concept has had limited success, and hence most CAs have been working strenuously to fulfil the needs of their clientele.
2. The Omicron – Fear
While the country has been unlocked gradually, we are suddenly observing and experiencing a sudden spike and severity of the third wave of Corona virus which is rising exponentially each day across the country.
Amidst this, several restrictions are still in place in various States including for movement and fresh restrictions are imposed in our state like night curfew and weekend lockdowns.
Even the people who are fully vaccinated are getting infected and the number of COVID-19 cases reported is still on a rise. There is also a huge fear of getting infected among the people due to which they prefer not travelling at all or restrict it to the vicinity of their homes for their necessity.
Due to this, several industries and private offices have started to close their offices.
The industries and offices that have resumed are still struggling to function at a low level of normalcy. This also includes the offices of the Chartered Accountants and Tax Practitioners.
Further, there are many senior Chartered Accountants in our area who are above 55 years. Though they are vaccinated, they are reluctant in going out for audits due to the spread of virus. As a result, the details required for conducting tax audit and filing the return of income are not being received promptly and thus the audits cannot be efficiently performed. Also hassles in travelling to the place of audit, staff members of Auditors / Assessee infected in the recent upsurge of the virus and either home quarantined or hospitalized makes it all the more difficult to complete the audit within the limited number of days available.
Several Chartered Accountants and Tax Practitioners (and also their close family members) themselves have also been infected and have not been able to work for minimum of 7-10 days. If they are infected in the next few days while the spread of the virus is wide and speedy, the businesses may suffer due to non-compliance. Also, the tremendous loss of many close relatives and family members in the second wave which took place almost at the same time last year is still fresh in memory. This has raised the level of fear and panic in not just the clients but also the Chartered Accountants.
These kinds of situations are making it very difficult for the assessees and the Chartered Accountants to comply even with the extended due dates.
3. Postponement of CA Examinations
The audit data, verification of accounts, finalisation work for tax audit reports is mainly prepared in the offices of Chartered Accountants by the articled clerks and students pursuing CA Final. The examination of CA Inter and Final concluded only on 20th December 2021. The articled assistants and students pursuing CA Final appearing for the examination had taken leave for the same. Therefore, the work in the offices of Chartered Accountants had been hampered to a considerable extent. In 2021 the issues in the IT portal resulted in effective filing of returns only from October onwards when many students had availed leave, putting huge stress on Chartered accountants.
4. ITR due dates for audit & non audit assesses
The due date for filing ITR for non-audit cases is 31st December 2021.
For audit cases due date for filing Tax audit report is 15th January 2022 and Income tax return is 15th February 2022.
The gap of 15 days is insufficient, as tax professionals can neither concentrate on work of audit assessee nor concentrate on work of non-audit assessee.
Whereas, the gap in these two due dates is generally two months in normal circumstances. The same principle should be followed.
5. Due date of Scrutiny Assessments
Many of our assesses have received notices for scrutiny assessments for AY 2019- 20 & 2020-21. All these notices are time bound and we need to respond to it before the time and date specified in the notice, usually within a week or so.
Tax professionals find it almost GSTR-9, GSTR-9C or to comply with the scrutiny assessments in the given time.
6. Glitches in the new Income tax e-filing portal
The Central Board of Direct Taxes (CBDT) has launched the new income tax e-filing portal on 7th June 2021. However, the website did not work at all for the first one week.
(a) Frequent updation of utilities/schema
We present below the launching of ITR utilities/schema date wise as follows: –
| ITR | First release | Latest Release |
| ITR 1 | 21-07-2021 | 21-07-2021 |
| ITR 2 | 17-05-2021 | 02-11-2021 |
| ITR 3 | 05-08-2021 | 02-11-2021 |
| ITR 4 | 21-07-2021 | 21-07-2021 |
| ITR 5 | 17-05-2021 | 17-12-2021 |
| ITR 6 | 04-06-2021 | 30-12-2021 |
| ITR 7 | 04-09-2021 | 04-09-2021 |
| 3CD | 26-10-2021 | 06-01-2022 |
Your Hon’ble Self can very well appreciate the fact the latest release of 3CD Tax audit report was made only on 06-01-2022. The schema gets frequently updated based on the inputs given by us. The portal is not free of errors and stable for the users to be hassle free.
(b) Issues in e-verification of ITR
After filing the ITR, we need to do verification for Individuals using Aadhaar OTP. Inspite of the fact it was done earlier, the portal asks for e-verification for the second time.
The same is the situation if DSC is also used for filing the income tax returns.
(c) SMS for registering DSCs
From 07-01-22, we receive the following SMS.
“Dear Taxpayer xxxxxxxxxx, please register your DSC on the new e-filing portal if not already done, since earlier registration on old portal is not valid. E-filing ITD inspite of the fact that we have registered the DSC earlier.”
At times, the portal asks to change the PIN, at times it throws an error of PAN mismatch, sometimes even the server is down. Even in the case of registered DSCs, lot of issues are faced while using the DSCs for verification purpose, specifically in the case of Karta / Partner / Directors etc.
(d) Registering new assessees
There are difficulties in first time registration of PAN in the portal. It is getting done after one or two attempts and takes even a day.
(e) Mismatch of data in 26As and AIS
The AIS was introduced only recently and we could notice a lot of mismatch in data between AIS and 26AS.
Further, the new system of AIS and TIS has added to the new set of verification and reconciliation of data by taxpayers. It is worth noting that in most of the cases, there is a lot of mismatches in the information reported in TIS as compared to the actual details and the same reported in Form No. 26AS as well. We could also notice differences between GST turnover reported in GST portal and 26AS Statement.
This has resulted in an additional burden on the taxpayers to reconcile the differences before filing the ITR in order to ensure that there are no further notices / unwarranted 143(1) adjustments and unnecessary hassles post filing of Income tax Returns.
(f) Errors in Form 29B
We could notice overlapping of data between 115JB and 115JC.
(g) Filing Errors
While filing the return the ‘loading’ stopped midway and flashed error in submission and so please try later, without assigning any reason.
(h) Errors in uploading Form 10A
While uploading Form 10A, we get the following error.
(i) Error in tax audit reports
(a) After filing the tax audit reports in Form 3CB-3CD we find the following error.
(b) When clicked on the view form button, portal freezes for a minute and then resumes with no response or download.
(j) Unknown Errors
Our Representation
As stated supra, we have never demanded for any extension or benefits in the recent past before the Ministry or CBDT.
In the current circumstances, we want Hon’ble self to consider our representation for the following concessions till the Income tax portal gets stabilised, fully functional and error free.
1. A complete waiver of:-
a. Penalty
b. Late Fee
c. Interest
2. Allow loss to be carried forward for the returns being filed during this period even it is filed after the respective due dates.
3. Grant condonation for delays in filing various statutory forms especially Form 10B which are subjected to be filed only through the Portal.
4. Allowing filing of revised returns in case of any errors that arose due to technical glitches on specific request.
While our primary request is to address the various glitches, few of which are listed above, at the earliest so as to enable smooth filing of ITRs and other forms on the new e-filing portal, given the current situation of the portal, we also request your Hon’ble to kindly consider granting the extension in filing the due dates in the interest of the taxpayers. We believe that this would convince the businesses and the professionals alike about the Government’s effort to walk the extra mile in addressing the grievances of businesses and ultimately facilitate transparency and compliance by businesses.
Thanking you.
Yours sincerely,
for and behalf of Thanjavur, Thiruvarur, Nagapattinam,
Mayiladuthurai and Cuddalore Districts,
| Thanjavur | CA. R. GANESH |
| Thiruvarur | CA. B. SARAVANA SUNDAR |
| Nagapattinam | CA. K.S. KUMARAVEL |
| Mayiladuthurai | CA. S. BERNARD |
| Cuddalore | CA. B. NATARAJAN |
Author Bio
Un justice to the 5th category income tax assessees,(residues of all five categories) has been done in respect of due dates extension. it has been denied to them presuming that they are not effected by the pandemic. thank you