'Refund Banking' makes tax refunds easier

New Delhi, June 11: The day is not far off when Income Tax Refunds would be a much more convenient and a less cumbersone affair.

''The government is planning to introduce Refund Banking and details are being worked out in this regard,'' Revenue Secretary K M Chandasekhar told sources.

The long and short of this concept is that instead of receiving Refunds from the Income Tax Department, a tie-up is being worked out with a Bank or a few banks which will transmit the refunded amount in the account of the assessee.

''This will reduce the interface between the asessing officer and the assessee,'' Mr Chandrasekhar said.

The top Revenue official said the intention of the government was to introduce the new mechanism as soon as possible, possibly in the current fiscal.

At present, the procedure is that an assesse files his return with the Income Tax Department, which after processing the case refunds the amount through a cheque.

''The entire process is being computerised. After you file the return it will go to the back office, which will have centrally controlled operations in three or four locations,'' he said.

Mr Chandreskhar said the Revenue Department was talking to the RBI, the Chief Accounts Officer of the Government of India, as well as officials of the Treasury Department regarding the new scheme.

Another advantage of the Refund Banking will be time, as there were considerable delays under the present system.

At present, a part of the refunds are handled by the State Bank of India, but once 'Refund Bankers' are appointed, tax refunds would be institutionalised.

UNI