CBDT sets up panel to recommend steps to reduce litigation

In an unprecedented move, the Central Board of Direct Taxes (CBDT)set up a six-member panel to examine the “efficacy” of the existing primary litigation mechanism in the Income Tax (IT) Department. The step has been taken in the wake of an estimated Rs 4 lakh crore of tax revenue locked up in litigation. The empowered committee, under the chairmanship of senior IRS officer and Chief Commissioner of Income Tax office in Ahmedabad Rani S Nair, has also been mandated to suggest steps to reduce legal cases at the IT department’s two dispute resolution forums and asked to submit its report within 8 weeks.

The panel has been constituted with an objective to evaluate the efficacy of existing dispute resolution forums of Commissioners of I-T (Appeals) and Income Tax Appellate Tribunal (ITAT) and to recommend steps to reduce litigation before these forums.

Currently, there is a four-stage grievance redressal and litigation mechanism available to a taxpayer. It starts with an appeal to the Commissioner of I-T Appeals called CIT (A), further up to the ITAT and subsequently to the High Court and the Supreme Court.

CBDT, the topmost policy making body of the I-T department, has also assigned the new committee with the task of undertaking a fresh initiative and categorize and examine select assessment orders issued by I-T officers across the country under various income groups (returned income).

The categories defined by CBDT include income under Rs 25 lakh, income between Rs 25 lakh-Rs 1 crore, between Rs 1 crore-Rs 10 crore and above Rs 10 crore.



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