Department's Monumental effort is to collect 2 percent of the total revenue
YESTERDAY, commenting on our Message Board, Advocate Gururaj said, In the past, when I had occasion to deliver talks in NACEN, Bangalore, I have posed this question to the departmental officers: "How much revenue is received routinely through self-assessment etc, and how much is received through recovery measures, demands etc?" Their consistent answer has been than more than 98% is realized routinely through self-assessment procedure. Though this is a ball park figure, it adds up when one compares annual indirect tax revenue receipts with the alleged revenue tied up in litigation. All the high drama of investigation, inquiry, SCNs, adjudications, appeals are only for realization of balance 2% or more .
Yesterday the CBEC released its Results Framework Document (RFD) for the Financial Year 2014-15, when there are just three months left in the Financial Year.
In the RFD, Board states that its target for Augmentation of revenue from Scrutiny of Assessment, Audit, Preventive operation, Anti-evasion operation, and Arrears recovery for the year on a best performance isRs.16550 crores. Board will be happy with even Rs. 14950 Crores.
Board hopes to collect an amount of Rs.6.23 lakh crores in the Financial Year 2014-15, out of which the collection through Assessment, Audit, Preventive operation, Anti-evasion operation, and Arrears recovery will be at best 16 thousand crores, about 2.5 percent as stated by Gururaj.
So all the hungama of audit, adjudication, notices, litigation, summons, hearings, visits, returns, reports and allied varieties of harassment is only to collect 16000 Crores. And for this we have an army of over 80,000 employees with over a hundred Chief Commissioners and hundreds of lower level Commissioners all of whom will cost the Nation about 6000 crores. The Net collection because of them would be Rs. 10,000 crores and even this amount might be under dispute and litigation. Revenue collection is obviously not the major task of the tax department. They are all busy with something else.