The Associated Chambers of Commerce and Industry of India (ASSOCHAM), apex industry body, has urged the Union Finance Ministry (FinMin) to ensure that returns filed by the tax payers are processed within a period of 7-10 days.
"While the taxes which are due from the taxpayers are recovered expeditiously and at an appropriate time, but at the same time it is equally important that taxes which are due to the taxpayers should be refunded expeditiously," noted The Associated Chambers of Commerce and Industry of India (ASSOCHAM) in its Pre-Budget Memorandum (Direct Taxes) for financial year 2015-16 that had been submitted to the Ministry of Finance.
"Despite online filing of return, a period ranging from six months to more than two years are being taken for processing of tax returns with the result that not only the refund due to the taxpayer gets delayed but also the tax demand due on basis of return to the taxpayer also gets delayed," noted the Pre-Budget Memorandum prepared by the ASSOCHAM Economic Research Bureau (AERB).
When various Stock Exchanges that process so many transactions of sale-purchase of shares online and various demat agencies are able to keep ledger account of securities held, dividend paid, bonus issue and can carry out other such transactions online and can process them in T+1 mode i.e. transaction day plus one day, there is no reason why processing of income tax returns can follow the same pattern, it added.
"This will go a long way in addressing the taxpayers' grievances and also expediting in filing the return of income," said Mr D.S. Rawat, secretary general of ASSOCHAM while releasing the chamber's Pre-Budget Memorandum.
The public perception is that refunds are delayed in order to meet revenue targets set up in the Budget and as such the tax authorities particularly in the month of March build undue pressure on taxpayer to deposit tax and do not release the refunds.
Terming it as ‘unfair to the taxpayer,' ASSOCHAM has pleaded to the FinMin that administration of tax laws should be fair to both taxpayer and tax administrator and the tax refunds need not be delayed and be issued expeditiously.
As regards large refund arising consequent to processing of all pending returns it will be one time hit which may result into all pending refunds getting released but as a tax payer friendly and fair regime it will be an important beginning, further stated the ASSOCHAM Pre-Budget Memorandum.