Income Tax Dept ‘writes off’ huge arrears

Mumbai, May 27: Apparently failing to recover massive tax dues from various corporate tax-payers in the country, the Income Tax Department (ITD) has now started “writing off” thousands of crores of tax arrears by such defaulters, according to RTI replies. This, despite the fact that the ITD is sitting on a pile of Rs 50,000 crore of tax arrears all over India, according to available figures, with the highest — Rs 33,157.97 crore — due in Pune, Maharashtra, alone.

The revelation has come from several replies given by I-T offices under various principal chief commissionerates of Income Tax (PR-CCIT) to RTI activist Chandra Shekhar Gaur, based in Neemuch, Madhya Pradesh.

When contacted, a top official of the Central Board of Direct Taxes (CBDT), New Delhi, admitted that there were certain provisions by which tax dues may be written off in certain cases.

“However, the tax-payers’ liability does not get extinguished even if it is written off for the time being. When we learn that the party’s financial situation has changed, we immediately initiate recovery proceedings as per law,” the CBDT official, who requested anonymity, said.

The official said the procedure (to write-off) was very long-winded, time-consuming and goes through various levels, depending on the amount and required clearances from different authorities.

At least two PR-CCITs — Hyderabad and Pune — having huge tax arrears, have admitted to ‘write-offs’ of unpaid taxes, Gaur said.

Pune’s Deputy Commissioner of IT (Hq-Admin) and the Central PIO, Harshit Bari said that the PR-CCIT here had notched up Rs 33,157.97 crores as arrears pertaining to Direct Taxes.

Against this, it had also written off a wee amount of Rs Rs 12.57 Lakhs, but the period for the waiver or the names of the beneficiaries are not specified.

Hyderabad’s Income Tax Officer (Hq-Tech) and the Central PIO, K. Srinivas Rao has replied that the PR-CCIT (Andhra Pradesh, Telangana and Hyderabad) had piled up consolidated arrears of Rs 1644.78 crore as of 2017-2018, which it had “completely written off”.

Mumbai’s tax-consultant and Chartered Accountant Poneet Gupta said that arrears may be written off when the assessee is untraceable or bankrupt, but there is no procedure under the IT Act to “write off” arrears.

“Under the General Financial Rules, 1963, powers to sanction write-off of the revenue have been delegated by the centre to the IT authorities based on the amount (of write-off) and seniority of the officer,” Gupta said. (IANS)