The CBDT has issued Instruction No. 07 /2017 dated 21st July 2017 in which it has lamented that in spite of a comprehensive instruction with well-defined role & responsibilities of various authorities, the pendency of outstanding objections has not abated. Further, indiscriminate remedial measures result in frivolous litigations causing undue hardship to tax payers. The CBDT has reviewed entire workflow to handle receipt audit observations with twin objectives of quick conclusion of remedial action in cases of accepted audit objections & to avoid remedial action as precautionary measure where observations are not acceptable. The CBDT has made it clear that it expects strict compliance by all concerned
Instruction No. 07 /2017
Government of India
Ministry of Finance,
Department of Revenue
Central Board of Direct Taxes
Audit & Public Accounts Committee Division
F. No.240/08/2015—A& PAC – II Dated 21/07/ 2017Sub – Instruction laying down Standard Operating Procedure to handle Receipt/Revenue Audit Objections-Regarding
1. Introduction
1.1 The Instruction No 9 of 2006 dated 7/11/2006 as supplemented by Instruction No 16 of 2013 deal with revenue / receipt audit. In spite of a comprehensive instruction with well-defined role & responsibilities of various authorities, the pendency of outstanding objections has not abated. Further, indiscriminate remedial measures result in frivolous litigations causing undue hardship to tax payers. The Board has reviewed entire workflow to handle receipt audit observations with twin objectives of quick conclusion of remedial action in cases of accepted audit objections & to avoid remedial action as precautionary measure where observations are not acceptable.
1.2 With the launching of Income-tax Business Application (ITBA), the work flow would be monitored by supervisory authorities on system. This would instill accountability at every level in field formation. The perpetual problem of reconciliation of pendency will be resolved with launching of a web-based portal by the office of the C&AG “osparas.ap.nic.in” where CIT-wise / AO wise pendency have been hosted. The portal has the facility for uploading of reply by the CIT concerned. In due course of time, the interface of ITBA would also be linked with C&AG’s new portal for complete work flow automation.
1.3 With the technological assistance of ITBA and CAG portal in place, Standard Operating Procedure (SOP) have been aligned to workflow in ITBA, with defined roles and responsibilities of each functionary in the hierarchy. The timelines for each step to be executed by officer concerned has been laid down hereunder.
1.4 In supersession of all existing instructions on this subject in general and instruction No 9 of 2006, Instruction No 16 of 2013 and Circular No 8/2016 in particular, this instruction is issued for strict compliance by all concerned.
There is no use of issuing such Instructions/orders. What is required is punishing the CITs by removing some of them under Rule 56(j) of the FR. Where Audit objections are barred by limitation, Revenue loss should be recovered from the concerned CIT.