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Neeraj Saxena
New Delhi, July 28: The provisions of the Union budget 1998 will result in downgrading and dilution of the Income Tax Appellate Tribunal (ITAT), say tax experts.
The Finance Bill has changed the eligibility criteria for recruitment to ITAT which experts feel will create an anomalous situation in its functioning.
It has made the deputy commissioners, or joint commissioners as they will now be known, with three year experience eligible for recruitment as accountant members. Similarly, senior sub-judges, who are grade II officers of Indian Legal Service, will also become eligible.
Earlier, only commissioners or chief commissioners with a minimum three years experience were eligible as accountant members, whereas sessions judge and additional sessions judges, who are grade I officers, alone were eligible for recruitment as judicial members.
The recruitment criteria for advocates and chartered accountants with a minimum 10-year experience has not been altered.
The experts are sore that the government hasmade a deliberate attempt to tamper with the functioning of an institution which has worked so well over the years and served the interests of the assessees for six decades. In fact, ITAT has been rated high among all other administrative tribunals and served as a model. All that could change now, they fear.
``Tribunal is the highest forum of appeal for taxpayers. This move will definitely dilute the functioning and diminish the respect of the ITAT. Even the benches constituted by Supreme Court and High Court to hear tax matters comprise specialist judges who are familiar with tax laws. Even otherwise, SC gives a lot of weightage to the opinion of the IT tribunals on facts and questions of law,'' points out O P Vaish, promoter Vaish & Associates and president, PHD Chamber of Commerce and Industry.
``Grade II officers without experience and exposure to even general law will have problems tackling the tax matters. Diluting the tribunal's quality will obviously affect dispensation of justice,'' he New Delhi, July 28: The provisions of the Union budget 1998 will result in downgrading and dilution of the Income Tax Appellate Tribunal (ITAT), say tax experts.
The Finance Bill has changed the eligibility criteria for recruitment to ITAT which experts feel will create an anomalous situation in its functioning.
It has made the deputy commissioners, or joint commissioners as they will now be known, with three year experience eligible for recruitment as accountant members. Similarly, senior sub-judges, who are grade II officers of Indian Legal Service, will also become eligible.
Earlier, only commissioners or chief commissioners with a minimum three years experience were eligible as accountant members, whereas sessions judge and additional sessions judges, who are grade I officers, alone were eligible for recruitment as judicial members.
The recruitment criteria for advocates and chartered accountants with a minimum 10-year experience has not been altered.
The experts are sore that the government hasmade a deliberate attempt to tamper with the functioning of an institution which has worked so well over the years and served the interests of the assessees for six decades. In fact, ITAT has been rated high among all other administrative tribunals and served as a model. All that could change now, they fear.
``Tribunal is the highest forum of appeal for taxpayers. This move will definitely dilute the functioning and diminish the respect of the ITAT. Even the benches constituted by Supreme Court and High Court to hear tax matters comprise specialist judges who are familiar with tax laws. Even otherwise, SC gives a lot of weightage to the opinion of the IT tribunals on facts and questions of law,'' points out O P Vaish, promoter Vaish & Associates and president, PHD Chamber of Commerce and Industry.
``Grade II officers without experience and exposure to even general law will have problems tackling the tax matters. Diluting the tribunal's quality will obviously affect dispensation of justice,'' headds.
``The new eligibility criteria will make even a Deputy Commissioner eligible to hear appeals against the cases decided earlier by Commissioners and Chief Commissioners. He will have far lesser judicial experience and exposure to handle those cases once decided by his seniors,'' says Tekan G Keswani, secretary (taxation), Associated Chambers of Commerce and Industry of India (Assocham).
``Deputy Commissioner is too junior a person to sit on a bench and dispense justice, while his seniors will argue the cases decided by them in front of him. He may even have the theoretical knowledge, but not the practical exposure. So the expectation of justice will be very low,'' laments SK Khurana, senior chartered accountant and advocate.
``It takes about 10 years before a Deputy Commissioner is promoted as Commissioner. Though the eligibility requirement for ITAT for Commissioners is three years, usually those who apply have a minimum of five to six years' experience. Imagine a Deputy Commissioner with threeyears' experience being made on par,'' he adds.
The issue should not have found place in the finance bill, say experts. They feel such a change in the IT Act should have been introduced through an amendment bill so that there was ample scope and time for discussion on the various pros and cons of such a move.
The changes were not discussed in the parliament due to paucity of time in spite of the fact that four chambers, CII, Assocham, FICCI and PHDCCI, had raised it in their post-budget memoranda with the finance ministry. It had also found opposition from other quarters such as the Institute of Chartered Accountants of India.
``The proposal was initiated at the behest of the Indian Revenue Service officers' lobby. It formed part of the working draft of the Income Tax Bill 1997 which could not be presented by P Chidambaram and was as it is included in the budget 1998,'' says Khurana. There are 38 ITAT benches, one each in the state capitals and more than one in larger states. The recruitment norms haveostensibly been diluted to fill up the vacant posts. But intriguingly, 25 appointments were made last year to fill up 18 vacant posts. Eleven of them are yet to be assigned work even as the cases have been piling up in the benches, causing inconvenience to litigants. It takes several years before the cases come up for the first hearing.
Each bench comprises one accountant member and a judicial member. While minor cases are adjudged by single member benches, important or controversial cases can be heard by a special bench comprising three, or even five members. In big cases, the assessees have the right to appeal in High Court or the apex court. Interestingly, the fees for filing a case with the tribunal too has been raised by several times to Rs 10,000.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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