Surat : Chartered Accountants Demands Recall of Incorrect Notices Issued to Partnership Firms

Surat : The Chartered Accountants Association of Surat (CAAS) has raised serious objections and is demanding the immediate recall of notices issued to thousands of assesses under Partnership Firms (FAS) under Section 143(1)(a) of the Income Tax Act, citing incorrect claims.

The association has expressed its concerns regarding the functioning of the Central Processing Centre (CPC) unit of the Income Tax department and the lack of response from the Finance Ministry.

In a strongly-worded letter addressed to the Union Finance Minister, CAAS highlighted the predicament faced by numerous assesses across the country who have received notices proposing adjustments under Section 143(1)(a) due to allegedly incorrect claims. These notices, generated by the CPC, have caused fear and anxiety among the recipients, leading them to seek clarification from their tax professionals.

One of the major challenges faced by tax professionals is the timing of these notices, with many being received late in the evening. This has resulted in a cumbersome exercise for tax professionals who must provide reassurance to the distressed assesses.

CAAS has called for swift action against the software provider or any other individuals responsible for these erroneous notices to prevent such hasty and irresponsible instances from recurring in the future.

It is important to note that Section 80P of the Income Tax Act does not allow deductions to assesses classified as partnership firms. Therefore, it is assumed that the income tax utility itself should not accept returns claiming deduction under Section 80P, as this deduction is exclusively available to Cooperative Societies.

CAAS emphasized that while a minor mistake on the part of an assessee can lead to severe financial and legal consequences, the Finance Ministry’s silence on major blunders that affect a large portion of the public is perplexing.

This is not an isolated incident, as similar instances have occurred in previous years. Such irresponsible processing not only wastes countless valuable man-hours of tax professionals and assesses but also hinders the nation’s development to a significant extent.

“CAAS is eagerly awaiting a response from the Finance Ministry and expects immediate action to rectify this situation and prevent the recurrence of such issues in the future. The association remains committed to advocating for the rights and concerns of assesses and tax professionals in Surat and beyond” said Hardik Kakadiya, vice-president of CAAS.