Abstract

If there is one area in the income-tax administration which has remained perennially incurable, it is the Refunds, says Narayan Varma, Chartered Accountant, who shows you an easy way to solve the problem.

In a Press Release dated April 19, 2007, the Central Board of Direct Taxes stated: “It has been reported in some sections of the media that a large number of taxpayers are awaiting refunds from the income-tax department for up to three years. These reports are factually incorrect and based on incomplete appraisal of facts”.

The Minister of State for Finance also stated that instructions were given to issue refunds within four months from the date of receipt of return and dispatched within 30 days from the date of signing the refund order.

I am sure most readers would doubt the correctness of the above Press Release and Statement. You may not have received refunds for one or more earlier years despite many reminders, personal visits, and grievance-cell applications. It is a helpless and hopeless situation.

You Have the Power

But don’t lose hope…Here’s a tool exclusively for you! The Right to Information (RTI) Act came into effect from October 12, 2005. The Act helps citizens to obtain information, which earlier was not available, from various Govt Departments and other organisations like PSUs, Indian Railways, RBI and so on. Information can be accessed through an application under the RTI Act. It is very simple, least time-consuming, most inexpensive. A few organisations (22 in all) like CBI, RAW are basically exempted. Further, certain exempt items under “Public Authority” include information on commercial confidence, trade secrets or intellectual property, information which would impede the process of investigation or apprehension or prosecution of offenders, personal information, the disclosure of which has no relationship to any public activity or interest or which would cause unwarranted invasion of the privacy of the individual etc.

RTI to the Rescue

Suppose, you have not received IT refunds for A.Y. 2002-03 of Rs 1,057 and for A.Y. 2004-05 of Rs 7,230 despite many reminders. You make the application in Annexure A (see specimen form below), and take it to a designated post office handling RTI applications. There are 88 designated post offices in Mumbai region alone (list available on www.bcasonline.org). For other cities, visit www.indiapost.gov.in to get details.

The fee for an RTI application to a Central Govt authority is Rs 10, which can be paid in the form of a Postal Order. To make the system operate easier, the Prime Minister has designated the Central Assistant Public Information Officers (CAPIOs) of the Department of Posts as PIOs for the entire Central Govt services, as a collection point for information under the RTI Act. The postal department now not only receives the fee on behalf of all Departments and issues postal order for it, but also takes the responsibility of delivering the RTI application free of charge to the concerned CPIO anywhere in India, on the same day. A commendable service indeed! The use of this service for delivery is at the option of the applicant. If you desire to deliver application to the concerned department personally or through registered post A.D., you may do so.

An RTI application should be addressed to the Public Information Officer (PIO). Each establishment (i.e. Public Authority) covered under the RTI Act has to appoint one PIO for its different offices. Until August 9, 2007, all Commissioners of Income-tax were PIOs. With new rules in place, now your assessing officer is the PIO for you.

Simple, Yet Effective

So far, the success of RTI applications in the IT department is unbelievably 100%. In every case, the RTI application gets attended to immediately and you get pending refunds within 30 days (in some cases it takes more time to get refunds due to non-availability of your return; you are then requested to furnish duplicate copies with Indemnity on stamp paper). I made an RTI application for refunds of my HUF. The application was made on June 1, 2006 for rectifications and refunds due from 1998 to 2006. This resolved all my pending matters and I received refund orders for Rs 45,182 (tax refund of Rs 30,950 and interest u/s. 244A of Rs 14,232). It is a remarkable and most effective tool to get your income-tax refunds if they have been due since long.

However, you have to be careful in framing the questions for seeking information. You cannot ask “why”; e.g., “why have you not issued my tax-refunds though overdue?” But, you can ask: “please inform when my overdue refunds will be issued.” Believe me, on asking such a question, you will receive all the refunds due, within 30 days. The RTI Act is so powerful that the results in most of the cases are amazingly remarkable.

The Act provides for a time-bound and defined process for citizens to access information. Severe penal provisions exist in the Act. Normally all laws provide penalty for the citizens for non-action or wrong action. Here is an Act which penalises bureaucrats for the same – Rs 250 a day for any default, maximum Rs 25,000.

Help at Hand

If you need any assistance, you may visit the RTI clinic run by BCAS Foundation (division of Bombay Chartered Accountants’ Society) at its office at Marine Lines on 2nd, 3rd and 4th Saturdays between 11.00 am to 13.00 pm every month. You need to fix an appointment on phone: 022-66595601. Outstation readers may write giving details and papers connected with refunds due and assistance / guidance will be provided by post.

I end by stating: RTI is the most powerful Act, the like of which India has never witnessed before. It has heralded participative democracy by recognising citizens’ rights. If well implemented and well-used, a real swaraj will dawn for India. Please use the tool of RTI for your benefit, the benefit of others and the benefit of the nation.