No happy returns: Saral just got tougher

KOLKATA: The business of simplification is becoming more complicated. Even as Finance Minister Jaswant Singh has vowed to simplify the process of filing returns by knocking down the number of forms required under various exemption schemes from some 50-odd to less than 25, the Finance Bill shows that may not quite be the case.
While dishing out some new exemptions, Jaswant Singh has added another eleven forms, to be precise. Each one is for disclosing specific information in prescribed formats under I-T rules.
Claims against medical expenses where assessees are covered by medical insurance will require more details, and that too in a prescribed format.
Thus, section 80DD or the newly-introduced section 80DDB gives exemptions to assessees only if the expenses are detailed, in a format to be prescribed.
This means medics and healthcare institutions will have to present the necessary details of expenses for which they claim exemption in a specific format to the authorities.
Patent owners and authors of books have also come under the scanner of I-T authorities and will be required to provide a certificate along with their I-T returns for claiming specific exemptions under section 80RRB and section 80QQB, respectively. The peculiarities do not end here.
Mr Singh has also promised that scrutiny will be restricted to only 2% of the total cases, and that too will be done through computerised random sampling. It may have given some joy to assessees, but for the introduction of an Annual Information Report which needs to accompany the annual income-tax return from the assessment year ‘03-04.
According to Ajay Doshi, partner, Doshi, Chatterjee, Bagri & Co, random computer-generated scrutiny and the newly introduced AIR can hardly co-exist — as the latter is superfluous if scrutiny is to be randomised.
The kind of information that the department seeks to accumulate will have little meaning if each of these AIRs are not scrutinised, Mr Doshi said.