The CBDT has issued a sternly worded directive dated 16th April 2018 stating that a number of complaints are being received in the Tax Payer Services Directorate regarding harassment, misconduct and high handedness of Officers and staff.

It is stated that such incidents damage the image and reputation of the Income Tax Department and dent the efforts of the Department to position itself as a service oriented organization.

All officers and staff have been instructed to deal with the public not only with administrative efficiency but also with the requisite soft skills.

It is stated that the behaviour needs to be impeccable not only in the performance of their official duties but also decorous outside the office.

The provocation for the directive appears to be the reprimand issued by Hon’ble President Kovind that the income-tax department is a “service provider” which should be “sensitive to the demands and dignity of the person”.

“Tax payer is your partner, not your adversary,” the Hon’ble President reminded the income-tax department

The recent Tax Refund Scam involving a bogus Chartered Accountant and several employees of reputed companies such as IBM, Vodafone, Saplabs, Biocon, Infosys, ICICI Bank, CISCO, Thomson Reuters has spooked the CBDT.

The employees had, on the advice of the bogus CA, filed nearly 1000 returns and made fradulent claims of refunds aggregating Rs. 18 crore.

The CPC has now issued an advisory stating that the Income Tax Department has an extensive risk analysis system aimed at identifying persons who are non-compliant and aim to subvert the trust based system envisioned while processing of ITRs at CPC Bangalore. In all such cases of high risk, the Department may examine and verify the details submitted by taxpayers in their ITR,subsequent to processing of returns in CPC.

It is warned in clear terms that if the Department notices any fraudulent claims in the returns, such tax payers may be punishable under various provisions of the Income Tax Act. This may also delay issuance of refunds in such cases.

The Central Bureau of Investigation (CBI) has issued a press release dated 12th April 2018 stating that an Indian Revenue Service (IRS) officer who is presently posted as Commissioner of Income-tax and two “Advocates and Chartered Accountants” have been arrested for demanding a bribe of Rs. 40 lakh for passing a favourable order.

The CBDT has issued Order No. 54 of 2018 dated 6th April 2018 whereby several Assistant Commissioners of Income-tax in the pay matrix Rs. 56,100-1,77,500 on completion of training at National Academy of Direct Taxes are posted in the region of Pr. CCIT (CCA) indicated against each of them with immediate effect and until further orders

The CBDT has issued an office order dated 3rd April 2018 in which it is noted that there is a trend of High Net Worth Individuals (HNWIs) migrating from their country of residence to other jurisdictions. It is stated that such HNWIs pose a substantial tax risk since they may treat themselves as non-residents for taxation purposes in the first jurisdiction even though they may have strong personal and economic ties with that jurisdiction. For examining the taxation aspects of such High Net Worth Individuals (HNWI), the CBDT has constituted a Working Group of high-ranking officials. The Working Group has to make recommendations for policy decision in respect of tax risks of the migrating HNWI population

The CBDT has issued a document titled the “Central Action Plan” in which time limits have been prescribed for various activities to be done by the AOs and CsIT(A) in the first quarter (April 2018 to June 2018) of FY 2018-19.

The CBDT has inter alia stipulated that disposal of assessments in at least 25 cases (20 in International Taxation cases) per Assessing Officer of limited scrutiny, set-aside assessment, reopened assessment u/s 147 and OCM scrutiny must be done by 30th June 2018.

The CBDT has issued Notification No. 04 dated 30th March 2018 whereby several IRS officers have been appointed in the grade of Assistant Commissioner of Income-tax in the pay matrix of Rs. 56,100 – 1,77,500.

The CBDT has also issued Notification No. 05 dated 30th March 2018 whereby several Assistant Commissioners of Income-tax have been appointed to officiate as Deputy Commissioner of Income-tax in the pay scale of Rs. 15,600 – 39,100.

The CBDT has vide Order No. 47 of 2018 dated 27th March 2018 ordered the promotion and posting of officers to the grade of Chief Commissioners of Income-tax (level 16 in the pay matrix Rs. 2,05,400 – 2,24,400) w.e.f. the date of assumption of charge of the post and until further orders

The CBDT has issued an important directive dated 28th March 2018 on the subject of processing of returns under section 143(1) of the Income-tax Act.

The CBDT has pointed out that from Assessment Year 2017-18, discretion of Assessing Officer in processing returns under scrutiny has been completely removed and therefore, all returns have to be processed as per provisions of section 143(1) of the Act.

This is irrespective of the fact whether in cases under scrutiny, the Assessing Officer is contemplating taking recourse under section 241A of the Act to withhold the refund so arising on ground of concern for recovery of revenue.

The CBDT has specified the methodology to be followed by AOs for such processing