Filing of returns difficult with new ITR forms

By Dr Suvrokamal Dutta

Replacing a single page ‘Saral’ form with ITR forms is set to make filing of returns difficult. The new series of ITR forms, from 1 to 8 is not at all assesses-friendly and voicing the same is Income Tax Bar Association.

Saral was used by all types of assesses except companies. Now, there are different types of forms for different categories of assesses. “Each of these forms have a large number of columns and require much more information pertaining to income sources than what was required earlier,” pointed out OP Tiwari, president of the association.

As per the institute of chartered accountants, Rs 1,000 per hour has been fixed as the fee to be charged by a CA who helps in filling the tax forms. Where Saral used to take five to ten minutes, new forms will take close to 3 hours and the fee will go up accordingly. A common man and a small businessman, who cannot fill it on his own, will be hit hard by all this.

The association demanded that these forms be made optional and Saral should be kept in circulation. This will help the assesses file returns on time and without difficulty. There are currently 3.5 crore assesses, the number has doubled in the last three years or so, and association said, the almost 10 times increase in revenue collection was because of simple forms. But, now these forms would discourage people from filing returns.

The association was also of the opinion that in case of doing away with the documents to be attached with these forms, there will be an increase in corruption as there is no evidence to be attached for corroboration of facts.

The new forms seek detail like cash inflow and outflow transactions, which are something a common man does not necessarily keep track of. “The department at least should have given an year to create awareness on this,” said tax experts.

“The new forms are valid only for an year only, it is nothing but a simple wastage of stationery. Moreover, storing them as information will be difficult,” said another expert from the association. Although new ITR forms are enclosure free, there is a clause, which needs “reading between the lines” as it maintains if you want refund, attach documents and keep them properly with you, said an expert from the association.

While, on one hand finance ministry is going to introduce a new simplified Income Tax code before the end of calendar year 2007, replacing the existing Income Tax Act 1961, why cannot it postpone the introduction of complicated forms, said the association.