The government may reduce time under which valuation of a person’s tax returns picked up for random scrutiny is completed to one year, a report in ‘The Economic Times’ has said.
As of now, valuation of tax returns picked up computer-driven scrutiny can be completed in two years after close of the assessment year.
So, scrutiny of returns for financial year 2014-15, which is assessment year 2015-16 that ended on March 31, can be completed till March 2018.
Government has proposed to reduce this period to 21 months, in the first stage, which means assessment for last financial year can be completed until December 2017.
Latest Finance Bill has suggested a shorter deadline for cases picked up for scruti ny without calling the assessee as well as those cases where best judgment assessment is done. This includes instances where returns are filed after the deadline, or are revised or where taxpayers have failed to comply with certain notices.
"We plan to reduce it by three months every year so that assessment is completed in 12 months," said a senior revenue department officer.
Sources told the paper that toning up the assessment process is one of important focus areas of the government, which is trying to depict a more friendly administration. It has already asked the tax department to avoid aggressive assessment.
In the next stage, the revenue department is stressing on timely completion of assessment as it was seen that exercise is time and again completed towards the end of the stipulated period.