The Mumbai Mirror dt. 8-10-2007, highlighted that the tax
department is proposing to publish the names of those, with tax arrears of Rs.
10 crore or more. It is the duty of the professionals to debate, whether such a
move by the tax administration is justified, especially when the quantum of
appeals are pending before the Higher authorities. It has been found that on
many occasions the additions are made for the sake of additions, knowing well
that the additions will be deleted by the Tribunal, hence, there is no
accountability on the part of the assessing officer to explain the such
additions.
Dr. Raja J. Chelliah in his report suggested as under (1992)
197 ITR 177 (ST) (257) Para 5.9. “Ways must be found to hold the officer
accountable for the kinds of assessments he makes under the present procedure.
An Assessing Officer, whether he be a Superintendent of Central Excise or an
Income Tax Officer, can over assess, raise additional demands without sufficient
grounds and yet remain unconcerned and unaffected if his over assessments and
additional demands or orders confirming demands raised by him are dismissed as
untenable by the Tribunal. In fact, there is a tendency on the part of some of
the Assessing Officers to recommend to the Commissioner/Collector that almost
every case in which the Commissioner (Appeals) or the Collector (Appeals) has
not sustained the additional demands created by them should be referred to the
Tribunal, because they stand to lose nothing if the Tribunal also rule against
their action. The Assessing Officers should be made accountable for their
actions by being blamed for raising demands which are not upheld by a reasonable
figure, say 50 percent, the officer should be given a black mark and
reprimanded. On the other hand an Assessing Officer should be protected and
defended if he has obeyed instructions of the Board and followed the court
rulings even though audit might raise objections about his action.”
There are number of instances when the stay petitions are pending before the
Tribunal the demand was recovered from the Bank by attaching the Bank Accounts.
Former Attorney General of India, Shri Ashok H. Desai, who is one of the high
tax-payers of our country, in a message on the occasion of honouring the high
tax-payers of Mumbai stated as under “I wish the state could follow the advice
of Kautilya who says that King must tax like Sun who takes the moisture gently
from sea but returns it manifold as bountiful rain.”
According to us this quote, must be kept on the desk of each
and every officer, who administer the tax laws. We are very sure that if spirit
behind the above quote is followed by the tax administration, we can achieve the
goal of having at least 10% of our population as tax-payers of our country. It
is very unfortunate that only the honest tax-payers are harassed, therefore, it
is an honest appeal to the tax administration that they should not publish the
names just because their record shows that there is tax arrear. In a situation
where an assessee succeeds in appeal and entire demand is quashed, who will pay
for the goodwill he lost in the society and business. Once you are branded as
tax defaulter even big corporates and Government may be reluctant to do the
business with the assessee. It may be very easy to brand the assessee as tax
defaulter but it is very difficult to gain the goodwill and reputation in the
business, in the process the tax department should remember that one should not
kill the goose, which lays the golden egg.
A thought for debate?
Dr. K. SHIVARAM
Editor-in-Chief