LAW MINISTER CALLS
FOR SIMPLIFICATION OF TAXATION LAWS
The Union Minister
of Law and Justice Shri K.Jana Krishnamurthi has said that fiscal
policy must aim at simplification of direct tax laws and plug
loopholes in the legislation. Addressing a conference of the Income
Tax Appellate Tribunal (ITAT) Bar Association and the Bench here
this evening, the Law Minister said that the ambiguity in the
enactment of tax laws needed to be avoided to reduce the zone
of uncertainty in tax administration as also to ensure uniform
application of laws to reduce litigation. Increased litigation
because of ambiguity of legislation was counter-productive and
failed to achieve the object of legislation, the Minister added.
Talking of complications
in the Income Tax Act, 1961, the Law Minister said it was difficult
for a common man to appreciate frequent changes brought about
in the Act. He said that it was a tragedy that millions of man
hours of tax gatherers, tax payers and tax advisors were squandered
away in grappling with the torrential spirit of such amendments.
The Minister said the success of any tax system depended on simplified
procedures and smooth administrative processes. Laws which defined
fiscal liabilities should be precise and ambiguous. He said that
proper implementation of tax laws was of great importance. Coming
to the ITAT the Law Minister said that it was expected to strike
a judicial balance between the legitimate needs of the State in
the form of revenue and the private rights of a citizen to earn
and retain as much as he could, the uncontrollable zeal of a tax
official and the unbridled greed of a tax dodger, and an officer
who applied the law at his whims and fancy of a tax payer who
considered himself above the law. The Minister was happy to note
that the arrears of cases in the ITAT had reduced from a high
of 3,02,349 cases in December 1998 to 1,95,996 cases as in September
2002. He hoped that with the computerization of records, bunching
of appeals, immediate disposal of matters covered by the decisions
of the Supreme Court and High Courts, granting of single member
powers to more members and a thinking in the IT Department not
to file appeals to the tribunal on small matters would further
reduce pendency of cases and help expedite disposal of cases by
ITAT.
The Law Minister
called for doing away with Section 260A in the Income Tax Act
introduces with effect from October 1, 1998, which has clogged
the rosters of the High Courts already having large arrears of
cases other than tax related. He said that a rethinking was necessary
to reduce the burdens on the High Courts as also to lessen the
time gap for a matter to attain finality in a tax case. Delay
in the disposal of such cases was neither in the interest of the
assessee nor the revenue. Therefore, the introduction of Section
260A having introduced the appeal system was another tier as the
first appeal against the order of the assessing officer lied to
the Commissioner of Income Tax (Appeals), then to the ITAT, thereafter
to the High Court and finally to the Supreme Court.
