Corporate India may not get tax refunds on time

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Mumbai, Jan 10: Corporate India may not get its income tax refunds well on time, curtsey a technical glitch in the software, designed to serve the assesses, filing e-return.

The Finance Ministry rules state that the refunds to the tax payer, if any, be disbursed within five months of his filing return. 'However, this is not going to happen as there is total mismatch in the tax data available with the Income Tax department and the National Securities and Dipository Limited (NSDL),'' a Mumbai Income Tax official told the sources today.

The city-based NSDL is the authorised agency dealing with the data relating to tax deduction at resource (TDS). According to the rules, a corporate assesee while filing his e-return has to mention any tax deducted at source on his behalf by a third party.

''At the time of his tax assessment, we take such deduction into account and suitably his tax liabilities are fixed. If the tax deposited is higher than the liabilities then we issue refunds, but if it is lesser then we issue demand orders,'' the official explained.

Such a deduction should reflect in his e-return. However, due to ill-designed software, this deuction does not reflect in our system, forcing us to issue demand orders to the assesse,'' the official said.

When the problem was brought to the notice of the Ministry, initially it issued orders, instructing the assessing officers to not to cross check the returns of the assesees with refunds/demand less than Rs 25,000.

''However, for the refunds/demand over Rs 25,000, the decision has been left on the assessing officer. So we are at sea, because if something goes wrong tomorrow, the reponsibility will come on us,'' the official lamented.

''Moreover, this would also result in additional paper work as we we will require physical proof. The Government in 2003 had made this e-filing mandatory for the corporate assesees in order to get over with the papers work. The purpose has now totally been defeated,'' he added.

In the currect financial year, there some 60,000 corporates filed their e-returns in Mumbai alone.

In addition, the Finance Ministry decree also makes e-filing of return mandatory for the firms either in proprietorship or partnership and individuals, having turnover of Rs 40 lakh or above.

Secretary General of the Income Tax Gazzetted Officers Association, Rajesh Menon said, ''In the absence of a clear cut policy on the issue from the Ministry, the Assessing Officers are unable to take a decision.

And this is hitting the refund work in a big way.''


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