Direct Tax collection - Dept may not meet target

Income Tax department has gone too aggressive to meet the target set for the financial year 2012. Government of India is facing huge fiscal deficit this year primarily due to the subsidy burden and failure to Disinvest PSU shares. Against the deficit target of 4.5%, it is likely to touch close to 6% of GDP. In this situation the only alternative for Government in the next 30 odd days is to go aggressive on Tax collection and delay the refund. The Vodafone case in which Supreme Court has asked the Government to return the Deposited amount has recently taken a new turn when the Government has decided to file a review petition before a five member’s bench. CBDT, the big boss of Direct Tax has asked its entire member to meet the target and has linked the collection to their performance appraisal and placement next year. Most of the Companies under Tax disputes are facing the wrath of the Tax department due to this sudden aggressiveness of the Tax team. The merit of the case / Right of Corporate to appeal before the appellate tribunal are not being in the mind of these Tax officials.