Send your grievance Citizen's Charter Analysis of problems Possible solutions

Income Tax Refunds/ PAN :

A common taxpayer has to face a lot of problems in getting his refund or Permanent Account Number from the Income Tax Department. More often than not, he ends up paying a bribe to get his refund. Parivartan has been collecting taxpayer grievances in Delhi on account of non-receipt of refunds. All such grievances are regularly handed over to the Chief Commissioner of Income Tax, Delhi for their redressal. 

The grievances received till now have been studied and analysed by Parivartan. The analysis of these grievances and interaction with a large number of taxpayers helped Parivartan in identifying the problems faced by taxpayers. Parivartan suggested some measures, which if implemented, could remove corruption in this area. The measures suggested are simple, do not require any legal amendments or any additional expenditure and can be implemented through administrative orders.

Parivartan presented this analysis of the problems and the measures alongwith the grievances to the Chief Commissioner of Income Tax and requested him not only to resolve the grievances but also to implement the measures suggested by Parivartan

Parivartan is now striving to have the grievances resolved and to have these measures implemented so that such grievances do not recur in future. Already, a large number of grievances have been resolved by the Department. Parivartan filed a Public Interest Litigation in Delhi High Court in the last week of July, 2000. Hon'ble Court directed the Department to consider and implement these suggestions. However, the Income Tax Department did not take any action on Court's directions. Parivartan waited for three months for the Department to implement these suggestions. When the Department did not take any steps, Parivartan again filed a petition in Delhi High Court in Dec, 2000 which is pending.

We are still receiving the grievances of the public on this account. If you are also not getting your refund or PAN and the IT staff expects/demands a bribe from you, please do not pay a bribe. Tell us. We will try and help you in getting your refund/PAN. But please, please do not pay bribes. Parivartan is doing it as a social service and does not charge anything for its services. However, at the moment, Parivartan is operative in Delhi only. Hence, send us your grievance only if you filed your return in Delhi. Parivartan is doing it as a social work. It is not charging anything for its services.

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I have an Income Tax refund problem :

(This exercise is meant for taxpayers assessed in Delhi only)

If you have not received your Income Tax refund for any year upto A.Y. 1999-00 and if you have not received any intimation from the Department that your refund has been withheld  u/s 241 of Income Tax Act, write to us with the following details :

 1.         For refund u/s 143(1)(a) :

  • A copy of acknowledgment of return filed.  Please ensure that return receipt number, ward/circle and date of filing are legible, in the copy being sent to us, from the stamps of receipt of the Department.  If they are not legible, please write these details in hand on the copy.

  • Copies of all representations made to the Department so far, if any.

 2.         For refund due to rectification u/s 154 :

  • Copy of order to be rectified. 

  • Copy of application to the Department u/s 154. 

  • Copies of all representations made to the Department so far, if any.

  3.         For refund due to appeal effect including revision u/s 264:  (Please approach us only if appeal order is dated before 31.12.00)

  • Copy of original order of the Assessing Officer. 

  • Copy of order of appellate authority that is to be given effect to.

  • Copies of all representations made to the Department so far, if any.

  4.          For PAN:

  • Copy of the PAN application filed with the department earlier.

  • A fresh application will also be required as the Department has no mechanism to trace out your application on the basis of your acknowledgement. According to some newspaper reports, the Department has lost a large number of PAN applications.

Checklist :

  •       Please submit all the papers in duplicate. 

  •       Your details should be accompanied with a covering letter addressed to the Chief Commissioner of Income Tax, New Delhi. 

  •       Please mention your name, address, tel nos. and e-mail address.  

  •       Please send your grievance at our address at Parivartan, 5B, Navkala Apts, 14, I P Extension, Patparganj, Delhi-92 either by post or in person. Do not send it through e-mail because the Income Tax Department refuses to accept grievances received through internet, which do not bear the signatures of the taxpayer..

Please do not pay bribes to anyone in Income Tax Department or to middleman to get you Income Tax refund or PAN. If you are unable to get it in normal course, please let us know. We assure you that we will get you your due rights without payment of bribes, though it could take some time. 

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The Income Tax Department, besides other things, promises to

  • Redress all complaints and grievances within 30 days.
  • Issue Income Tax Clearance Certificate u/s 230 of Income Tax Act within 7 working days and that u/s 230A of Income Tax Act within 30 days.
  • Dispose of all rectification applications u/s 154 of Income Tax Act within 30 days.
  • Give effect to appellate orders within 30 days of the receipt of such orders.
  • Issue refunds within 30 days of determination.
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Analysis of the problems:

An analysis of the various grievances received at Parivartan and interaction with taxpayers shows that the types of problems faced by a common taxpayer, with respect to obtaining refunds from the Department, can be classified under the following categories:

 1.      The returns are not processed in chronological order. There is no method, which is followed to process returns. Any return can be processed at any time. This gives a lot of leeway to the concerned officials. They would process only such returns in which their demands for bribes have been met or in the cases, which are referred to them by their colleagues, friends or seniors.

2.     After filing the return, there is no mechanism by which a taxpayer could know the status of his return. There are no channels available to find out whether a taxpayerís return has been processed and refund sent or how much more time would it take before he gets his refund. Naturally, he is forced to make visits to the Department, thus, wasting his time, money and energy. Either he visits the Department and gets his work done by paying a bribe or he simply forgets about his refund. If he pays the money, he gets his refund else, the harried taxpayer keeps making visits to the Department. 

3.    Sometimes, the taxpayer receives intimation u/s 143(1)(a) which says that a refund is due to him but the refund cheques never reach the assessee. The taxpayer, now, has to get in touch with the concerned officials, pay a bribe and only then does he get his cheque. 

4.    Often, the refund cheque is received after the expiry of the validity period of three months. Again, the assessee applies for revalidation of the same and the same is not done without payment of bribe. 

5.    Sometimes, if the refund cheque is deposited in the bank, it is returned by the bank for want of Ďadviceí from the Department. Again, the advice is sent by the concerned officials only on fulfillment of their demands. 

6.     Similarly, the PAN is allotted within no time if the desired amount is paid to the staff. Else, there are cases where PAN has not been allotted even after two years of their application. Even if the PAN has been received by a taxpayer, the card never comes. 

7.     Citizenís Charter : The Department has a Citizensí Charter which lays down time limits for different types of jobs. However, in practice, these time limits are seldom followed. 

    a)      The Department promises to redress all complaints and grievances within 30 days. Parivartan received cases where grievances have not even been acknowledged, leave alone redressed for years together.  The poor taxpayer does not know where to go and what to do now. The only option left with him is to pay the bribe and get his grievance redressed.

    b)      The Department promises to dispose rectification applications within 30 days. Again, such applications have not even been acknowledged, leave alone disposed after years of pursuing. The rectifications are done only on the payment of bribes.

     c)    The Department promises to give effect to any appeal order within 30 days. However, effects have not been given years after the orders were passed by the appellate authorities despite several visits and letters by the taxpayers. The appeal effects are given only on payment of bribes.  

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The following are some measures. Implementation of these measures will not only prevent the recurrence of these problems in future but also stop corruption in these areas for all times to come:

1.      The returns should be processed in strict chronological order on first-cum-first-served basis according to the return receipt numbers. No return should be allowed to be processed on out-of-turn basis. It is the Fundamental Right of a citizen to be treated equal before law. Processing anyoneís return out-of-turn violates this Fundamental Right of those taxpayers who filed their returns before him. Under no circumstances, whatsoever, any officer/ official should have the discretion to allow out-of-turn processing. An out-of-turn processing is done by an officer only due to one of the following reasons:

    • When the concerned officer has taken a bribe, or

    • When a colleague, friend, relative or senior has referred that case to him.

In both these cases, it amounts to misuse of official position. Hence, if there is any case of out-of-turn processing, it should be treated as a confirmed case of vigilance and disciplinary action should be taken against concerned officer without any enquiry.

2.    The return receipt number upto which refunds have been issued in each ward/ Circle/Special Range by the end of each month should be displayed on the website of the Department and also on the notice Boards of the Department. Through this, a taxpayer will come to know where he stands and he will not have to contact the concerned staff for this. If someone does not receive a refund, though according to the website, he should have received it, this matter should be investigated at the level of Commissioner of Income Tax and disciplinary action taken against the concerned officials within a month. The taxpayer should be issued refund within a week of such representation.

3.    The Finance Minister has announced implementation of electronic clearing of refunds in this budget. However, we feel that the final implementation of this would require an elaborate infrastructure and could take time. Pending that, the refunds should be credited directly to the bank account of the taxpayer through RBI. A similar system exists in Chennai, which has been appreciated by everyone. It should also be implemented in Delhi. This would do away with the problems of loss of refunds in postage, validity period, advice not sent etc.

4.    Citizensí Charter :  The time limits mentioned in the Citizenís Charter are quite liberal, for instance,

        It hardly takes two hours to give appeal effect (other than set aside cases) but the Citizensí Charter gives 30 days time for the same.

        It hardly takes one hour to rectify an order u/s 154 but the Charter gives 30 days time for the same.

        It  hardly takes half an hour to issue an ITCC u/s 230 and 230A but the Charter gives 7 days and 30 days time respectively for the same.

Despite such liberal time limits set in the Citizensí Charter, in practice, they are seldom followed. This creates a situation wherein the staff is not accountable on any of these accounts. They do not do the work unless their palms are greased. We want that these time limits should be strictly enforced. If any officer does not adhere to any of these time limits, it should be treated as an automatic dereliction of duty and action should be taken against such officer accordingly. (Except in the case of set aside and partly set aside cases where it takes some months to give appeal effect)

5.    The Finance Minister has announced that PAN card would be issued within 30 days of application. We understand that the Department has some infrastructural problems in issuing PAN cards. But it takes a few minutes to allot a PAN to any taxpayer. We want that this time limit should be strictly enforced for allotment of PAN (not issue of cards) and any violation of the same should again be treated as an automatic dereliction of duty.

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