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Ministry pulled up for delay in IT refund

By Our Special Correspondent

NEW DELHI DEC. 16. The Accounts Committee of Parliament has come down hard on the Finance Ministry for the inordinate delay in refunding the excess income tax paid by assesses, which was resulting in huge avoidable interest payments. In its report presented to Parliament, the committee said there had been delays of up to 50 months in the issue of refunds. The report quoted an audit scrutiny to point out that granting refund beyond the relevant assessment year resulted in an avoidable payment of interest of Rs. 11,397.61 lakhs in 1,881 cases and about Rs. 2,133.87 lakhs in 138 cases of appeal.

The Finance Ministry told the committee that the power with the Income Tax authorities to hold back refunds had been removed from June 1, 2001.

Also, under the Central Action Plan 2002-03, targets had been fixed to process returns involving refunds within three months and to issue and despatch refunds within seven days of determining the refund amount.

The committee said that there were cases of excess payment of advance tax by companies, including public sector undertakings. The Income Tax Department should conduct a study on the trends in advance tax payment system and other factors giving rise to huge refunds to ascertain who the major claimants of the refunds were.

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