Bureaucratic Sloth and Apathy

I had earlier written on “Who are the real terrorists” – this is just a re-affirmation of my beliefs. The incidents I am going to narrate have already been reported on – just want to give my insights about the same. Three incidents in the recent past in relation to the 26/11 terror attacks in Mumbai, firstly the Pakistani Premier saying about a month ago that the DNA records for two of the terrorists were absolutely identical, and our lazy bags going defensive saying that they need to check, second the Defense advocate Anjali Waghmare did not disclose her conflict of interest and the latest being Mr. Pranab Mukherjee going on record stating that Kasab’s mother wanted to come to India to see her son.

Firstly, I cannot imagine such gross negligence, apathy and sheer inefficiency in sending an official record to a foreign government based on which India expects to have action initiated against the planners of the terror attacks in Pakistan. All we have managed to do is give the Pakistani media and officials the opportunity to say “I told you so”, now they can gleefully state that India is delaying action! So true! Can you imagine the seriousness of the lapse? If this had happened in the private sector, heads would have rolled for sure – the documents have gone through a lot of checks and verifications at multiple levels and still there is a glaring mistake for which we are going to pay in one way or another. The defense advocate was appointed without verifying whether she has filed papers for filing claims from one of the victims - a clear case of conflict of interest! I do not know Waghmare, but I am sure as a lawyer she knows the meaning of “conflict of interest” and should have been honest to disclose the same to the Court. The Court officials should have also noticed it and should have short circuited the issue before the trial commenced, which did not happen. It was left to the Public Prosecutor to point out the lacuna, after which there was no option but to declare a mistrial and ask for a new advocate. Lastly Mr. Pranab Mukherjee going on record that Kasab’s mother wanted to visit him in India – what a joke he has made of himself in public at the time of elections! Maybe she came in his dreams and told him, or with his advanced age he started hallucinating, I don’t know. The above three incidents have definitely marred our image in the international arena – we have made complete fools of ourselves! Guess who were responsible? You are right – bureaucrats and politicians – inefficient, slothful, dishonest and a complete disgrace to the common man – these are the real terrorists!

There is another field in which bureaucratic apathy and dishonesty needs to be highlighted – the revenue services – in particular the income tax department. I have been in practice for about twenty two years now, and have as a rule avoided tax trial and appellate practice, due to the quality of work and type of people you end up dealing with. You guessed right again – people who worry more about their revenue rather than the ex-chequer! As the financial year comes to a close, there is always a flurry of activity in the revenue departments to try and meet targets set by the Finance Ministry. This year due to the world wide recession, collections were bound to be low, but the government in all its wisdom decided to use its muscle to embark on raids and surveys to pump up collections. In such a vast country, with coercive action, collection will go up, but will it go up to the extent expected - has the cost of the coercive action been factored into for finding out whether the net receipts are positive for the government? Well I guess not, let me tell you why. From the second week of March, a lot of my clients have been getting orders under section 143(1) (summary assessment) of the Income Tax Act raising a tax demand from Rs. 1 crore plus to Rs. 50000. In all the orders, it is pertinent to note that factual tax credit is not displayed, thus raising a tax demand based on the income declared in the tax return filed. This is happening in spite of e-TDS returns being filed and the process being computerized to a large degree. In fact when I checked individual Form 26AS (the online tax record of the assessee based on advance and self assessment tax paid and TDS records, in all the cases the amount of tax credit shown on 26AS did not match with the tax order nor with the actual tax paid by the assessee.

Why should this happen, you may well ask! The motive for raising frivolous tax demand could be two fold, firstly by raising the demand the tax department is showing a receivable (albeit fake) to the Finance Ministry, thereby achieving their “targets”. This is sheer “hidden unemployment” at work as the system is being frivolously used to raise fictitious tax demands. The onus thus falls on the assessee to file a petition under section 154 to rectify the order, by providing proof of tax paid. So a whole lot of productive time is wasted in rectifying a fictitious tax demand. In a few cases the assessee may not have the original tax paid proof, in which case the second objective of the bureaucrats is achieved – make some pocket money on the side. Once the financial year is over the revised estimates will automatically show a lower collection – shades of the Satyam Scam in government, what say!!

Will someone tell me why the online tax payment, online filing, and tracking system does not work for income tax when it works for the ministry of company affairs? The government has spent so much time and money in developing a system which should have made the burden easier for the assessee and getting of tax refunds a cinch! But alas, that has not yet happened. You have to respond to letters from the department, and run with all the paperwork to prove that you have paid the tax! We are an Information Technology superpower – at least we think so – in which case can some one tell me why our tax department is so rotten and screwed up (pardon the language)? By now you would have understood the reason for the title to this post!!