Search:



The Web

Rediff








 Latest Business news on mobile: sms NEWSB or BIS to 7333

Home > Business > Business Headline > Report

Online tax system not so simple

Monica Gupta in New Delhi | November 08, 2004 10:54 IST

The government's decision to introduce a new single challan under the online tax accounting system in June this year appears to have complicated, rather than simplifying, the direct tax filing system.

The latest data available with the revenue department indicates that over Rs 6,000 crore (Rs 60 billion) has been wrongly attributed as income tax rather than corporate tax up to October.

Moreover, nearly 50 per cent of the challans filed are in suspense resulting in inaccurate accounting, incorrect collection figures and taxpayers not getting their credit or refunds.

The number of challans being put in suspense accounts has gone up from 42 per cent in September to 47 per cent in October.

The challans had been put in suspense either on account of wrong entry of Permanent Account Number or Tax Deduction Account Number, wrong payment head or amount, senior government officials said.

In Delhi alone, over 10,000 challans have been put in suspense since May this year, involving an amount of over Rs 800 crore (Rs 8 billion). The collection figures in Delhi as on September 30 according to the zonal accounts officer stood at around Rs 7,200 crore , while it was lower at Rs 6,500 crore (Rs 65 billion) as per the OLTAS, leaving a gap of about Rs 700 crore (Rs 7 billion).

Prior to June, corporates had to file four copies of challans, which were replaced with the new single-copy challan. Corporates now file their challans in their bank branches, which are forwarded by the branch to the bank's zonal office.

The zonal office, in turn, forwards the main copy to the zonal accounts officer and returns the counterfoil to the taxpayer after stamping the unique challan identification number. About 31 banks and eight centres of the Reserve Bank of India are collecting taxes.

Officials say that in order to correct the data, the assessee has to contact the bank branch as well as the assessing officer.

But since the banks send the challans to the zonal accounts officer and do not retain any copy, there is no retrieval machinery. "There is a need to put in place a cross-verification procedure for data entry of challans," an official said.

The revenue department had carried out an assessment with the collecting banks, which revealed that there was no standard software for validation checks and every bank was using its own software for data entry, an official said.

He added that there was no separate format in the software for challan form No 280 and 281, which had TAN rather than PAN. Hence, all these challans were going into suspense due to invalid PAN.


Article Tools
Email this article
Top emailed links
Print this article
Write us a letter
Discuss this article









Powered by










Copyright © 2004 rediff.com India Limited. All Rights Reserved.