The faceless scheme was expected to give a facelift to the tax administration in the country providing taxpayers the convenience of filing returns online with least physical interface. As it turns out now that the automation drive of the Income Tax (I-T) Department has gone completely awry with taxpayers thrown at the mercy of officials once again to be on the right side of compliance.
Ever since its June 7 launch, the revamped I-T portal developed by Infosys has which was suppose as to usher taxpayers into a new era of tax administration, has become a system generating heartburns with problems at it each step be it faced in generating passwords, linking data for past returns, and filing of returns.
The problems which started with minor glitches on the portal on day one, has gradually aggravated with each passing day so much so that the finance ministry had to summon Infosys MD & CEO Salil Parekh late last month. Finance Minister Nirmala Sitharaman held two meetings with Parekh in two months to understand the reasons for continuing glitches on the tax and had now given the developer a deadline of September 15 to resolve these.
The launch of the new portal has brought home the truth about how the I-T Department has made taxpayers dependent on technology in fulfilling their income tax obligations. The previous running website was made non-functional from June 1, with a new era starting from June 7.
But in the two weeks into its launch, logging remained a challenge, and even if one surmounted that, none of the functions worked. The case after two and half months of the launch is no better, as documents are still not getting uploaded, there is complete failure to link old data for past returns, and problems in filing returns continues. The problems have now expanded to include errors in interest calculation, incorrect capturing of details from Form 16, and inability to add details for tax exemption for trusts.
Taxpayers are also facing problems on not getting acceptance for their ITR-1 days after submission, inability to e-verify the ITR after filing, Form 26AS details not getting automatically populated, and the portal not having a secure connection and taking time to load properly. In some cases, individual taxpayers are also being asked to pay penalty for delayed submission of ITR even though the government had earlier extended the deadline for all categories of taxpayers with individuals now requiring to file their ITR only by September-end.
“I tried again and again to pay my calculated income tax for 2020-21 but the online system did not accept the payment. Besides, I was shown a late fee which was varied depending on the total tax calculation with minimum starting amount of Rs 1,000/- which was also wrong. Now I am waiting for the revamped website to go online to file my taxes before September 30,” Arpit Dutt (name changed), 30, a self-employed professional in the textile industry told IANS.
The problem is not only for novices and individual taxpayers, even experts are scratching their heads to see firms go through and tabulating returns with past data.
According to noted tax expert Ved Jain, tax portals are not social media platforms where you just communicate your views, here it is a statuary platform that is essential for compliance of tax regulations by the taxpayers otherwise there are issues of penalty, interest payments etc.
“The glitches have not only impacted taxpayers but also created for tax professionals as a complete stop on filing of tax returns has piled up case files in their offices and they are seen in a confused state on how to deal with compliance matters when systems are not functioning.”
Jain has a simple solution to the current problem.
“Why can’t we switch back to the old portal till the time a new one is rectified for all its issues and is ready to offer seamless service to taxpayers from day one? But the issue I suppose is, have we kept the old portal intact before getting a new one live,” he said.
What had baffled many in the current mess is the selection of Infosys once again to be the vendor for software offering services to millions of Indian taxpayers. The same agency has developed the GSTN software that was also full of glitches in the earlier run and with several days when the system completely crashed. Even now GSTN, the software running the indirect tax administration in the country is generating false information with regards e-way bills creating problems on inter state movement of goods and services.
“The problem I see is in the process how government contracts are awarded to the cheapest bidder or the one who gives the lowest quotes. Low margins in government contacts means that an implementing energy may cut corners to develop a software that is needed to support over five million taxpayers. I am fearful, that the system, which is working as of now, may crash soon on the sheer load of its users,” said Sumit Agarwal, a chartered accountant who runs his own firm in Delhi.
“Don’t shoot the messenger. There is something seriously wrong in our processes. Another thought: while Infosys might be good in business processes, it might not be in such government legal frameworked processes. So this is an opportunity to hone skills,” said a taxpayer who has been regularly checking the status of his tax returns with a chartered accountant.
The government in early 2019 selected Infosys Ltd. to develop the next-generation income tax filing system for Rs 4,241.97 crore which would cut down the processing time for returns from 63 days to one day and expedite refunds.
The cabinet, chaired by Prime Minister Narendra Modi, then gave its approval for the Integrated E-filing and Centralised Processing Centre 2.0 Project of the I-T Department.
Though the ambitious project is still taking shape, like several big initiatives, it seems even the this initiative is in for initial pains for maximum gains in future.
All eyes are now on September 15 by when the developer is rod system of all its snags. But not all are buying the deadline.
According to Agarwal, the problems could persist for long and it would not be easy for the developer to rid the system of glitches in the complex process at this stage with such a short span.
In the meanwhile, the suggestion is to move back tax administration a decade back to the era of paper forms and manual interactions between taxpayers, professionals and officials.