Challenges in securing stay on tax demand undermine faceless assessment gains
Live MintAdverse tax assessments by tax authorities often result in additional tax liabilities, commonly known as "tax demand." The Assessing Officer has the discretion to grant a stay on the tax demand while an appeal is pending before the commissioner, provided the taxpayer demonstrates valid grounds. Read this | Simplify, simplify, simplify: The mantra of India’s Income Tax Bill To secure a stay, the AO may require the taxpayer to pay up to 20% of the disputed tax. This issue arises because the grant of stay orders is still a manual process, whereas refund adjustments are automated through the Central Processing Unit, often leading to the full tax demand being collected despite the taxpayer’s right to a stay. Given the government’s emphasis on leveraging tax technology, it is time to digitize and streamline the stay application process, reducing reliance on physical paperwork and manual intervention.
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