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e-Filing of Tax Returns - An update on the current status
[Submitted by CA. Girish Borkar,
Mumbai]
November 6, 2006
This article is a corollary to the article on
e-filing by the same author.
As of date around 45000 corporate returns have been filed
electronically. That means around 19000 returns have to be filed on an
average daily if all the corporate returns have to be filed by the
extended due date - viz. 30th November, 2006.
Problems persist with the software downloaded from the income tax web
site. From 12th October, 2006 to 18th October 2006 the file validation
utility (FVU) which converts the file from SRF to XML was not working.
This FVU has been supplied by Skorydov - a private software company. This
utility came with a date lock of 12.10.2006, which the IT department
realized on 18.10.2006. On 19.10.2006 the Income tax web site requested
assessees to download a 'patch' which in effect changes the system date to
10th October, 2006 and also integrates with the FVU. I tried a simple
system date change on the desk top but that does not work - you need to
run the downloaded batch file. Changing your system date to file your tax
return in effect means back dating which could be termed illegal as per
prevailing laws. Apart from the above, I detail below problems which have
not yet been taken care of and how I managed to circumvent the problems
with the express intention of filing my clients tax returns.
- In Part A of the return line 26 asks for holding company details-
the address and PAN number. In case of foreign holding company or
subsidiary company located outside India the address will be an overseas
address and the Company will not have an Indian PAN. The software does
not validate the same as you need to input an Indian PIN code and PAN in
the specified format. The solution to this is to give the overseas
address and the Indian office PIN code and enter the PAN as'AAAAA9999A'
and then validate the sheet.
- The Ward number of the assessee is entered in point 8 in the excel
sheet, but when you convert the same into XML - it appears in point 9
which you need to fill in case of change of assessing officer. You need
to cut-paste it from point 9 to point 8 to correct the problem.
- For giving details of Beneficial owners of shares and of Directors
(2nd and 3rd worksheet) - again you need to give their addresses and
PAN. In case of Foreign Directors, the worksheet asks you to enter state
code as "99-Foreign Person" in which case you do not need to give the
PIN and PAN. This works fine in the excel sheet and the sheet does get
validated. This option though they have not included in Part A for
Holding or Subsidiary company details. At the time of uploading the
return on the government web site after duly logging in, error is thrown
up asking for PIN code and PAN of as the case may be 'subsidiary
company/holding company', Beneficial owner" or Directors". The only
solution is to give a local address PIN code and PAN as 'AAAAA9999A' and
then upload the return without affixing the digital signature and file a
physical copy of the return. Along with the physical copy a letter is
being submitted signed by my clients that wrong information was given
with the sole objective of complying with the legal compulsion of filing
return electronically. As it is, if you file the return digitally signed
then you could be penalized for submitting wrong/false information.
- Even if the assessee has not distributed its profits by way of
dividend (Schedule 16), in some cases at the time of uploading the
return on the web site you get an error saying date error for dividend
distribution. The solution is to write the date as 31/03/2006 and keep
all other factors as '0' and then upload the return.
- Similarly in Schedule 18 - Bank account details - mandatory to be
given in refund cases, if the assessee banks with a foreign bank where
do you get the BSR code from? If you try to upload the return you get an
error stating branch code wrong. The solution is to enter '000 0000' and
upload the return, as the web site checks only for three plus four
numeric values in the two columns. What confounds me is why all these
details are being asked for - as the refund can easily be credited
electronically based on the bank MICR code.
There are other issues in relation to the manner in which the software
has been developed. In the case of submitting of TDS details in schedule
24 - if the assessee mentions the TAN number of the deductor it should be
sufficient for the department to link up the TDS being claimed by the
assessee with the quarterly e-TDS return filed by the deductor. It is
beyond me why the department wants this extra data entry work to be done
by the assessee as it is nothing but duplication of work already done at
the time of filing TDS returns.
I just hope that when they make it mandatory for other assessees they
will have their house in order, else I foresee a lot of chaos in the
offing.
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