High Pitched Scrutiny Assessment-Concerned AO to be transferred and no coercive action for recovery-CBDT Chairman

High Pitched Scrutiny Assessment-concerned AO to be transferred and no coercive action for  recovery in cases identified by the Local Committee-CBDT Chairman

Functioning of Local Committee to deal with tax payers’ grievances arising from High-Pitched Scrutiny Assessments

In 2015, the CBDT had issued Guidelines for constitution of Local Committees in each of the Pr. CCIT Regions to expeditiously deal with taxpayers’ grievances arising from High Pitched Scrutiny Assessments. The Committees were required to dispose of taxpayers’ grievance after examining the case on parameters such as high-pitched additions on frivolous grounds, non-observance of principles of natural justice, non-application of mind, gross negligence etc . on the part of Assessing Officer. In cases where Local Committee found the order to be unreasonable or high-pitched, they were required to submit report to the concerned Pr. CCIT/CCIT so that proper administrative actions could be taken in such cases .

As per latest communication of CBDT Chairman to all Principal Chief Commissioners of Income Tax, in last three years, the performance of Local Committees has not been found to be satisfactory. Last Year i.e. for 2016-2017, after follow-up from the Board, Pr. CCsIT furnished their report on cases held to be high-pitched by the Local Committees. In some of the instances/cases, these reports were found to be deficient/incomplete.

The letter further states that for the financial year 2017- 2018, no report of Local Committee from any of the Regions has been received by the Board. Against the Instruction No. 17/2015 which required all CCsIT to highlight outcome of work of Local Committees in their  monthly DO Letters to the respective Zonal  Member, however, very few charges are following this practice .

Even, the CBDT Chairman has even stated that on personal feedback from some of the charges he has come to know that Local Committees have not been duly reconstituted after transfer/promotion  of Members of the existing Local Committee. Even meetings of the Local Committee are not being held regularly in most of the Regions.

The CBDT Chairman has stated that these deficiencies in functioning of Local Committees are hampering their effectiveness in tackling high-pitched assessments in an institutional manner and emphasised due attention by the CCsIT themselves to monitor performance of Local Committees on a regular basis so that these Committees serve as a useful mechanism/institution to curb high-pitched assessments in the Income-tax Department.

In addition to the mechanism outlined in Instruction No. 17/2015, the following further steps has been prescribed in cases which are found to be high-pitched by the Local Committees:

 3.1 Wherever Local Committee has taken a view that addition made in the assessment order is high–pitched, explanation of the Assessing Officer should invariably be called for. Wherever required , administrative action such as inter–city transfer of the concerned Assessing Officer to non–sensitive post should be taken in such cases without any delay. Further, appropriate disciplinary action should also be taken/initiated in these cases;

3.2 No coercive action should be taken for  recovery of demand in cases which have been identified as high–pitched by the Local Committee;

3.3 The concerned  Commissioner (Appeals) should be requested to expedite hearing in such cases.

All Pr. CCsIT have been instructed to furnish the reports of Local Committees regarding assessments framed during the Financial Year 2017-2018 by 31st July, 2018 and thereafter on quarterly basis.

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