Re-extending of I-T returns filing deadline shows finance ministry in a bad light

Honesty doesn’t absolve CBDT and the ministry mandarins of inefficiency and ineptness

The CBDT has made no bones about the reason why it has further extended the last date for filing income tax returns for the salaried class and others sans business income for the assessment year 2021-22 to December 31, 2021, from September 30, 2021 -glitches in the new I-T return filing portal. For others too, the deadline has been extended beyond the end of the calendar year to dates perilously close to the last date of the assessment year.

To be sure, last year too, there were a series of extensions first from the statutory deadline of July 31 to November 30, 2020, then to December 31, 2020, and finally to January 10, 2021. But then the assessment year 2020-21 was marred by first wave of coronavirus and the resultant lockdown that brought economic activity to a screeching halt.

A couple of years ago, citizens in Kerala were given a generous extension when rains and floods wreaked havoc in the state. No such extenuating circumstance can be cited this year. Indeed, it has not been to the credit of the CBDT, which has been honest with taxpayers in admitting glitches marring the filing of returns on the new portal.

But honesty doesn’t absolve it and the finance ministry mandarins of the charge of inefficiency and ineptness. The following points crave an answer:

1. Ill-timed launch of a new portal: What was the tearing hurry in launching a new portal bang in the beginning of a busy I-T returns filing season -- June 7, 2021, to be precise? It could have been launched during the lull period --which is November to March, during which time all deadlines for filing returns are over.

Why did Infosys not engage the services of tax experts alongside techies each step of the way, given the fact that domain expertise -- above anything else, is most important in banking and tax software? The system throws up weird warnings like losses from house property cannot exceed Rs 2 lakh whereas this limit is not applicable for let-out properties. Willy-nilly, an impasse has been reached preventing completion of the I-T return filing process. No landlord reporting loss in excess of Rs 2 lakh would settle for this limit imposed by the faulty system and not by the law

2. No trial runs: Why was the new portal launched without dummy returns in adequate numbers ranging from the simple to the most complicated by the mandarins of the finance ministry? It is surprising that heads haven’t rolled in the finance ministry for this monumental botch-up.

3. No tax experts’ services engaged: Why did Infosys, the IT service provider giant, not engage the services of tax experts alongside techies each step of the way, given the fact that domain expertise -- above anything else, is most important in banking and tax software? The system throws up weird warnings like losses from house property cannot exceed Rs 2 lakh whereas this limit is not applicable for let-out properties. Willy-nilly, an impasse has been reached preventing completion of the I-T Return filing process. No landlord reporting loss in excess of Rs 2 lakh would settle for this limit imposed by the faulty system and not by the law.

4. Run old and new portals simultaneously: And pray, why not allow for a parallel run of the old and new portals? Kotak Mahindra Bank, for example, launched its new net banking portal some six months ago, but it has had the sensitivity and commercial sense to allow its customers to continue to use the old one so that they come to terms with the new system gradually. Even now, it is not too late. The CBDT can and should allow a parallel run of both old and new portal, which would obviate the need for extension till December 31, 2021, and beyond.

5. Don’t fix anything that ain’t broken: This is an old adage that resonates in this context. Nobody knows why the new portal was launched and that too, at a considerable expense when the old one was working fairly smoothly sans glitches. Chronic tinkering is not progress. Nani Palkhivala’s memorable words--feverish legislative activity achieving no more good than a fever--come to one’s mind in this regard. There are many assessees who file their returns early so as to get refund of excess tax deducted at source. They will have to now sit tight and wait, for no fault of theirs, particularly when they are unable to complete the process of I-T return filing due to say not getting Aadhaar OTP or for any other systemic glitch.

Admission of lack of readiness is the most damning self-exposure of ineptness.