In the last two years, the income tax department collected Rs 4,600 crore from 5.6 million updated I-T returns filed by taxpayers (CBDT records 5.6M updated ITRs, collecting Rs 4,600cr taxes in 2 years).
According to CBDT chief Nitin Gupta, the income tax department collected Rs 4,600 crore from 5.6 million updated I-T returns in the past two years (CBDT records).
Gupta mentioned in a post-budget interview with PTI TV that the I-T department established a demand management center in Mysuru, Karnataka, concentrating on resolving disputed pending large tax demands exceeding Rs 1 crore (CBDT records).
Gupta stated, “We are enhancing services, aiming for a litigation-free environment. The facility for return updation resulted in 5.6 million updated returns, generating approximately Rs 4,600 crore in taxes.”
The Interim Budget for the fiscal year 2024-25 has unveiled a significant move towards the withdrawal of outstanding small tax demands, including some dating back to 1962.
This initiative targets demands of up to Rs 25,000 until the financial year 2014-15, encompassing income, wealth, and gift taxes. The scope of this measure extends to addressing approximately 11.1 million disputed demand entries, with the aggregate tax demand involved estimated at Rs 3,500-3,600 crore.
According to Gupta, the Chief of the Central Board of Direct Taxes (CBDT), this decision is expected to benefit around 8 million unique taxpayers.
The approach involves handling small and large tax demands separately, with a specific focus on the latter through a dedicated demand management center. Gupta expresses confidence that this strategic maneuver will yield substantial dividends and enable more effective management of tax demands.
In the context of the announced withdrawal of disputed demands in the Budget, Gupta points out that most are currently on the books. He highlights the complexity of the situation, citing cases where taxpayers might have already settled their tax demands.
However, due to the manual nature of record-keeping in the past, these payments might not be reflected in the system (CBDT records). Gupta acknowledges the potential existence of fictitious demands, either already paid or not payable by the taxpayer, without proper documentation.
The primary objective of this withdrawal initiative is to streamline and modernize the tax system, reducing grievances among taxpayers. Gupta emphasizes the department’s commitment to addressing these issues, aiming for transparency and efficiency. He notes that the exercise is anticipated to encompass a substantial number of entries and taxpayers, potentially numbering in the millions (CBDT records). He believes that this proactive step will benefit taxpayers and contribute to cleaning the department’s records for improved overall efficiency.
