In a bid to reduce tax-related litigation and streamline dispute resolution, the Central Board of Indirect Taxes and Customs (CBIC) and the Central Board of Direct Taxes (CBDT) have outlined significant measures following the latest budget proposals.
Speaking at the CNBC-TV18 Budget Verdict Townhall event, CBDT Chief Ravi Agarwal highlighted the steps taken to ease tax disputes, including a substantial increase in the thresholds for filing appeals. “For tax disputes at the tribunal level, the threshold has been raised to ₹60 lakh, while for the High Court, it’s ₹2 lakh, and for the Supreme Court, ₹5 lakh,” Agarwal said. This move, aimed at reducing the volume of appeals, is expected to bring about faster resolution of pending cases. The CBDT has ramped up resources to address this, assigning principal commissioners of income tax the responsibility of deciding appeals, further accelerating the process.
Agarwal also drew attention to the successful Vivad Se Vishwas scheme, which closed on January 31, 2024, and saw 40,000 applications for dispute resolution. “About 8% of the pending appeals opted for the scheme, marking a significant step in reducing litigation,” he said. The CBDT plans to continue with its dispute resolution efforts by establishing committees to handle smaller appeals, providing relief to taxpayers with outstanding dues.
The CBIC, led by Chairperson Sanjay Kumar Agarwal, also discussed reforms on the indirect tax side. To reduce procedural delays, a new time limit has been introduced for finalizing provisional assessments. “Previously, provisional assessments remained pending for long periods, which led to prolonged demands,” said Agarwal, adding that the new provisions would bring certainty to the trade and curb litigation.
Another key measure discussed by the CBIC Chairperson was the introduction of voluntary declarations for customs-related disputes. Under this provision, importers can now voluntarily declare discrepancies in their duties post-clearance and make payments with interest, but without penalties, provided no audit or investigation has already been initiated. In cases of excess duty payments, importers can now directly file refund claims instead of having to go through lengthy appeals processes. This, according to Agarwal, will significantly reduce the procedural hurdles and litigation burden.
Both the CBDT and CBIC emphasised that the steps taken in the budget aim to provide taxpayers with greater clarity and certainty, encouraging voluntary compliance and reducing the need for protracted legal battles. The reforms are expected to streamline the entire tax dispute resolution process, fostering a more efficient system that benefits both the government and taxpayers.
Source from: https://www.cnbctv18.com/budget/cbic-and-cbdt-chiefs-outline-key-steps-to-reduce-tax-related-litigations-19552028.htm
