Building on last year's clearance of 172K cases, I-T department is pushing for faster appeal disposals, penalty reforms and system-driven processes to curb litigation and boost tax certainty.
'Tax cases are technical in nature... Many high courts do not have a tax bench, which also contributes to the delay.'
The Federation of Indian Chambers of Commerce and Industry (Ficci) has sought urgent steps to clear the huge backlog of income-tax appeals, simplify tax deducted at source (TDS) compliance, and ensure tax neutrality for fast-track demergers, during its consultation with Revenue Secretary Arvind Shrivastava ahead of the Union Budget 2026-27.
Ask rediffGURU and tax expert Mihir Tanna your income tax-related questions.
'As a result of delays, the desired reliefs are not coming for taxpayers.'
'There is no retrospective changing of the law, only its simplification.'
'Tax officials view most taxpayers as evaders.' 'The I-T department has a perverse incentive to raise unreasonable demands since the one-fifth tax collected counts towards officials' collection targets,' observes Harsh Roongta.
There are about 31,000 pending cases, locking revenue worth Rs 500 crore.
The Vivaad se Vishwas Tak scheme will be one area where some much-needed revenue can be collected by the government. The scheme can be more successful if some specific steps are taken, says investment advisor Harsh Roongta. This results in a very high tax demand. Investment advisor Harsh Roongta takes you through the maze of appeals and counter appeals.
Multinational software firms like Microsoft, SAP and Oracle -- which license software and earn royalty on it from Indian customers -- are facing the heat from assessing officers if they have not paid taxes on the gross royalty income. According to a ruling by New Delhi-based commissioner Income Tax (Appeal), Microsoft has to cough up over Rs 700 crore in taxes and interest for the period 1999 to 2005.
The Central Board of Direct Taxes, the apex policy making body of the I-T department, has been undertaking a host of steps to bolster the litigation management wing of the department which has come under criticism not only from courts but also successive Finance Ministers and in the audit reports of the Comptroller and Auditor General.
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