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September 21, 2022

Grievances and suggestions with respect to the functioning of Demand Facilitation Center, CPC in connection to the outstanding demand

by CA Shivam Jaiswal in Circular and Notifications

Grievances and suggestions with respect to the functioning of Demand Facilitation Center, CPC in connection to the outstanding demand

Date: 19th September 2022


Smt. Nirmala Sithararnan

Hon. Union Minister of Finance and Corporate Affairs Government of India

Hon’ble Madam,

SUBJECT: Grievances and suggestions with respect to the functioning of Demand Facilitation Center, CPC (DFC) in connection to the outstanding demand

The Karnataka State Ch    artered Accountants Association (R) (in short ‘KSCAA) is an association of Chartered Accountants, registered under the Karnataka Societies Registration Act, in the year 1957. In the past, we have written to your good selves many times populating various issues, challenges and hardships being faced by taxpayers and suggesting possible solutions on the same. Through this representation, we would like to bring to your kind notice, a few practical issues being faced by taxpayers. For every issue, challenge or hardship highlighted, we have also made suggested solutions to address them all.

We laud the efforts of the government in registering steady growth in gross tax collections and the introduction of various taxpayer-friendly measures to reduce litigations. Despite the sincere, honest, and best efforts of the Revenue Authorities, we have witnessed delays in getting the outstanding demand nullified/ rectified and/or obtaining a refund as may be due.

At this juncture, we wish to reiterate the taxpayer’s charter that the Income Tax Department is committed to:

is committed to
1.  provide fair. courteous, and reasonable treat:nem
The Department shall prow prompt. courteous. And professional assistance in all dealings with the taxpayer
B. maintain confidentiairty
The Department shall not dtsclose any information proi.ded by taxpayer to the department cress authonzed by law
2. treat taxpayer as honest
The Department shall treat every taxpayer as honest unless there is a mason 10 believe otherwise
9 . hold its aulhonties accountable
The Depwrnerg shat tad its authorities accountable for they actions
3. provide mechanism for appeal and review
The Department shall provich, far End impartial appaii and review mechanism.
10. enable representative of choice
The Departrnent ettal slow every taxpayer to choose in authorized representative di ?vs choice
4. provide complete and accurate information
The Department shall provide accurate information for fulfilling compilers:a obligations under the law.
11.  provide mechanism to lodge complaint
The Department shag provide mechanism for lodging a comptaint and prompt disposal thereof
5. provide timely decisions
The Department shall take decisions” every income-tax proceeding within the erne prescrbed under law
12. provide a fair & Just system
The Department shell provide a far arid imparbal system and resolve the tax issues in a time-bound manner
6. collet the comuct amount Of tax
The Department shall collect only the amount due as per the law
13. publish service standards and report periodically
The Department shall publish standards for service delrvery ii a per04C manner
7. respect privacy of taxpayer
The Department wit follow due process of law and be no more intrusive than necessary in any intwiry. exavietation, or enforcement action
14 . reduce cost of compliance
The Department stiall duly take int0 account Me cost Of compliance when adminrstenng tax legislation

We at KSCAA have worked closely with multiple stakeholders to understand the issues at hand, we have made efforts to consolidate the same and are enumerating the following issues and a few suggestions with respect to the operation of the Demand Facilitation Center, CPC (DFC)

A. The primary reasons for the demand:

  1. Demand for old years, as appearing on the IT portal, should be backed by the order leading to such demand along with evidence of ‘due process’ being followed. It will enable the Assessee to take appropriate legal recourse. In many instances, even the Assessing Officer is not aware/is in possession of the cause of demand, leaving the Assessees remediless;
  2. The Order Giving Effect (OGE), nullifying the demand has not been passed pursuant to the settlement under the Direct Tax Vivad se Vishwas Act, 2020 (VSVS);
  3. OGE has not been passed pursuant to a favourable order of the Appellate

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