Functioning of the Recovery Officers. - Income Tax - 1520/CBDT

INSTRUCTION NO. 1520/CBDT Dated: July 20, 1983 Section(s) Referred: 222 Statute: Income - Tax Act, 1961 In the wake of mounting arrears of Income-tax and other direct taxes over the years the report of the Comptroller Auditor General of India for 1981-82 tabled in the Lok Sabha on 4th April, 1983, severely criticised the functioning of the Recovery Officers in the country. The appraisal of the C AG attributes the slow pace of recovery to defective Planning of work in the Income-tax Offices, defective maintenance of records in the Recovery officers, lack of coordination between the Income-tax and Recovery Officers and inadequate recovery proceedings. 2. There are complaints that most of the ITOs issue recovery certificates in a mechanical manner without ascertaining the correct position of demand which leads to harassment to a large number of assessees at the hands of TROs. Keeping in view the report of the C A G as well as these complaints the Board would like the field officers to take the following steps : (a) The Commissioners of Income-tax should ensure that the TROs and their staff are well versed in the recovery procedure. For this, it is necessary that each TRO should be given a Refresher Course in recovery work as soon as possible after his appointment as TRO. As regards the training of the recovery staff this should be done at the station of their posting or at the headquarters of the Commissioners of Income-tax by officers having experience in recovery work. (b) The Commissioner of Income-tax (Recovery) in the Metropolitan Cities have brought to the notice of the Board that the Recovery Wings are not given the adequate sanctioned strength by the administrative Commissioners. Instances are also there where the staff given to the TROs are not relieved after their posting. In many cases it has been found that the Tax Recovery Officers and their staff do not want to put normal period of service in this Wing of the Department. The Board would like to impress upon the adminstrative Commissioners that adequate manpower should be deployed to this important area of work. Once persons are posted in the Recovery Wing, it would be ensured that they complete their normal tenure of 3 years in this job. It should also be ensured that before completion of their tenure, proposal for denotification of TROs are not sent to Board. (c) It goes without saying that a tax recovery certificate is the hinge on which the entire work of recovery depends. The report of the Comptroller Auditor General of India mentions cases of serious lapses like furnishing of wrong address or other relevant particulars in the tax recovery certificates. To prevent this members of the staff entrusted with the job of preparing recovery certificates, or found to be in the habit of putting recovery certificates in a mechanical manner to the ITO without verifying the actual demands should be dealt with sternly. The ultimate responsibility for this lapse of furnishing incomplete and inaccurate details in the certificates should be fixed on the Income-tax Officer forwarding the certificate. (d) The Commissioners are requested to issue instructions to the ITOs that TROs will bring to the notice of the Commissioner of Income-tax the cases where the certificate signed by the ITO bear wrong addresses or where details of assets given in the certificates are either incomplete or incorrect. (e) Once an assessee comes forward and submits evidence showing that the demand in question has already been paid, the TRO, instead of directing the assessee to obtain the cancellation order from the ITO (as in the practice now) will depute and Inspector to the concerned ITO to verify the submissions and evidence furnished by the assessee and arrange to get a report from the ITO showing the correct position of the demand. In the meantime, he may issue a letter to the assessee to the effect that the demand has been kept in abeyance (as provided in item 9 Chapter II of the Tax Recovery Inspectors' Manual). (f) The TRO should not take any coercive step, such as sale of movable and immovable assets, detention of defaulter in the Civil Prison, for the recovery of the demand during the period when the evidence furnished by the assessee is being subjected to check by the ITO (as provided in item 8, Chapter-II of Tax Recovery Inspectors' Manual). 3. The Commissioners are directed to bring immediately these instructions to the notice of the Tax Recovery Officers and the Income-tax Officers of their charge. It should be impressed upon these officers that the Board is keen that the above steps are taken to avoid addition to the infructous work of the TROs and the ITOs as also to improve the public image of the Department.