Ready for submission, direct tax panel report gets 16-day extension

It is learnt that the deadline extension was given as Chief Economic Adviser (CEA) Krishnamurthy Subramanian sought more time to give additional inputs, two sources familiar with the developments said. “Along with other members of the committee, the CEA had already given his inputs after which the report was finalised. He sought more time to give additional inputs, following which the government decided to extend the deadline,” one of the sources said. Queries sent by The Indian Express to Subramanian did not elicit any response.

The Finance Ministry in its statement said, “The Government has allowed the Task Force to submit its report by 16th of August, 2019, in light of the fact that the new Members of the Task Force requested for more time to provide further inputs.”

The Task Force has been mired with delays since its constitution in November 2017. The Task Force, headed by former CBDT Member (Legislation) Arbind Modi, was constituted in November 2017 in order to review the Income-tax Act and to draft a new Direct Tax Law in consonance with economic needs of the country. “During the Rajaswa Gyan Sangam held on September 1-2, 2017, Prime Minister Narendra Modi had observed that the Income-tax Act, 1961 (the Act) was drafted more than 50 years ago and it needs to be re-drafted. Accordingly, in order to review the Act and to draft a new Direct Tax Law in consonance with economic needs of the country, the Government has constituted a Task Force…,” a Finance Ministry statement dated November 22, 2017 had said.

Then, in November 2018, the Finance Ministry appointed Akhilesh Ranjan, Member (Legislation), CBDT, as convenor of the task force after the retirement of the earlier convenor Modi. Other members of the task force had remained the same: Girish Ahuja (chartered accountant), Rajiv Memani (Chairman and Regional Managing Partner of EY), Mukesh Patel (Practicing Tax Advocate), Mansi Kedia (Consultant, ICRIER) and G C Srivastava (retired IRS officer and Advocate).

On June 24 this year, the government had nominated Subramanian as a permanent special invitee to the task force in place of former CEA Arvind Subramanian along with nominating Joint Secretary (Revenue) Ritvik Pandey as a new member. Before that in February, Pragya Sahay Saxena, a joint secretary in the CBDT, was co-opted as a member of the task force.

The panel was initially supposed to submit its report to the government, within 6 months, by May 22, 2018, which was further extended till August 22, 2018. Fissures between the six members of the panel ensured that the report was not submitted before the superannuation of Arbind Modi on September 30, 2018. The Akhilesh Ranjan-led panel was then tasked to submit the report by February 28, 2019, which was then extended till May 31. A two-month extension was then again given to the panel to submit its report till July 31.

In June this year, the ministry had also broadened the terms of reference (ToR) of the task force to include faceless and anonymised verification/ scrutiny/ assessment and reduction of compliance burden by simplification of procedures. The task force would also examine sharing of information between various agencies including goods and services tax authorities, customs, CBDT and Financial Intelligence Unit along with looking into ways to reduce litigation and for expeditious disposal of appeal cases.