Taxpayers may get refund within a month!

Good news awaits hundreds of thousands of taxpayers in the country. The Income Tax department is mulling a proposal for providing them small refunds of below Rs 1 crore (Rs 10 million) within a month's time.

Delay in receiving income tax refunds has been a major complaint of taxpayers and the department is hoping to address the issue on a priority basis.

"For refunds, I will talk to my officers and ask them if we can devise a mechanism to issue refunds, under a certain monetary limit, within a month's time or so," Central Board of Direct Taxes (CBDT) Chairman Sudhir Chandra said.

According to Income Tax officials, the proposal pertains to small tax refunds of an amount below Rs 1 crore.

Chandra said that he has been asking officials in the I-T department to work for the benefit of honest taxpayers and give them the respect they deserve.

"We will be very firm with tax evaders without being harsh. We will make sure that a honest taxpayer is respected and will also try to create maximum trust for honest taxpayers," Chandra said.

The Income Tax department is in the process of issuing more than 40 lakh refund cases before April this year.

The department has streamlined the refunds process as the statutory time limit to process the return and issue refund in the financial year 2009-10 is March 31 and almost 49 lakh such cases involving crores of rupees are pending with the department, a senior I-T officer said.

Chandra also said the approach of the I-T department will be based on the traditional Indian way of 'shubh-labh' (auspicious and benefit).

"Whatever we do, we will do it by the way of shubh-labh. By this we mean that labh (tax collection) will only be done through shubh (permissible provisions of the law) procedures," he said.

The Income Tax department is also in the process of establishing three more I-T returns and refunds processing centres at Manesar (Gurgaon), Pune and Kolkata on the lines of the existing centre at Bangalore.

To fasten the refunds through banks, the Refund Banker Scheme has been made operational in the entire country with the help of the State Bank of India by the department.