I-T department will erase petty tax demands on its own: CBDT chief

New Delhi: The income tax department will “erase” petty tax demands pending against about 80 lakh taxpayers on its own and issue a “speaking order” explaining the process to be followed, CBDT chairman Nitin Gupta said Friday, a day after the measure was proposed in the interim Budget.

Union Finance Minister Nirmala Sitharaman had on Thursday declared the government’s proposal to withdraw outstanding direct tax demands up to Rs 25,000 till 2009-10 fiscal and up to Rs 10,000 for financial years 2010-11 to 2014-15.

This was being done, she said, as part of an effort to improve ease of living and ease of doing business for citizens. The finance minister added that there were “a large number” of petty, non-verified, non-reconciled or disputed direct tax demands, many of them dating as far back as the year 1962, which continue to remain on the books, causing anxiety to honest taxpayers and hindering refunds of subsequent years.

“We will erase these demands, we will extinguish such a demand from the records of the tax department. The taxpayer does not have to do anything and we will not be getting in touch with them (taxpayer) at all.” “This process will not be adverse to the assessee,” Gupta said

However, he said, such demands will be put on the e-filing portal of the individual taxpayers so that they can also have a look and if there is any issue, the department will resolve it, the top tax department officer said.

The income tax department has garnered about Rs 4,600 crore in taxes from 56 lakh updated I-T returns filed by taxpayers in the past two years, Gupta said.

Gupta added, “If the taxpayer has an issue with regard to these demand cases like rectification or there could be a case where appeal effect has not been given or a refund issue is pending, then it will be taken care of.”

“We will come out with a speaking order that will explain everything...,” he said.