NEW INCOME TAX LAW AND RUMOUR MILLS

INTRODUCTION

A simple press report and all the shallow and the gullible bandwagoned it into a cause celebre.Even Whatsapp university is not as fickle as the Li college.The celebration came specially from the shallow minded who ,unable to even basically understand the intricacies of the IT Law but jealous of those who do and make big bang bucks ,desired to board the gravy train but did not have the competence ticket.

A press release and a statement by CBDT Chairman (see annexures at the end)should put an end to the dhol manjeere gang dancing in the aisles blowing their mediocrity trumpet.Nonetheless ,even if their fantasies were true ,it is still no cause to rejoice.Here are the reasons.

1.No understanding how a new law is made.The Committee set up will give a report in SIX months(if it can.I doubt it would).Then it goes to the stakeholders for views,opinions and objections.A Select Committee reference thereafter is guaranteed.Further inquisition follows.The committee report is likely to be tabled in Parliament.Debate shall ensue.And then,maybe then….

2.Forgetting history at their own peril.A Direct Tax Code was ready .In 2010.Was supposed to be effective 1.4.2012.Never saw the light of day.Another revamp and a new code was made in August 2019(Akhilesh Ranjan Committee).Never saw light of day.

3.Too complicated.This is the major argument.The proponents betray shallowness of their understanding.Tax law is not literature or poetry.Its the nature of the law.

Tax follows commerce.

And commerce is complicated.Because the frontiers and dimensions of human endeavour to generate money cannot be circumscribed by CODES.Human ingenuity is infinite and rightly so.That is why ,man,the weakest biological creature,survived and conquered the biologically more able.

Once that is granted ,one can easily see why tax law,by definition, is super complex(I prefer the word to ?omplicated’)or multi faceted to cover the commerce.You want sunshine industries to shine,you want to promote manufacturing in specific regional pockets,you want to do justice to intricacies of specific businesses like shipping and insurance,you want to accommodate accounting nuances like prior period expenses or amortisation or accrual et al,…..ad infinitum.You want to ensure penalisations for tax evaders,search and seizure provisions,account for human ingenuity by making SAARs and GAAR,create a robust tax recovery mechanism,ensure income does not escape assessment,follow principles of natural justice……I can fill reams of pages writing what all is desired to be achieved via taxation.

And we speak of ‘too complicated’?Tax law is neither for the weak hearted nor of the pygmy minded.Till human endeavour remains,commerce will be complex.And so will tax.

4.The 1961 ACT has seriatum 1-298 sections.Its mother Act ,the 1922 one ,had just s.no. 1-68.

Wonder why?

Just think.

Intellectual giants created such brilliant laws.Now the CBDT ,`which cannot hold a candle to their brilliance, will REPLACE these brilliant scholars.?Ha!

Just see their attempts at faceless assessment and s 148 .Ten times more litigation has been created by such mindless tinkerings.Faceless appeals is the biggest joke of them all.And they will now change the law?Fat chance.

`5.Jurisprudence provides certainty in law.Precedents create confidence that what I plan today shall not be retroactively upset.Such rich tapestry of judicial excellence ,statutory drafting ,great first principles-100 years of? sheer hard work and at least 70 years of sheer magic(1922-1992)….and we want to undo it.

6.A slight tangent.We saw way more simple laws –IPC,EA Cr.PC being replaced.What changed?

In BNS ,there are only 8 new sections.Rest are additions,deletions within sections.BSA has all of ONE new provision and SIX? sub provisions.Minor modifications,additions ,deletions.BNSS being procedural law is just a implementation vehicle.That too has just 9 new sections.

[For data ,I have referred:https://www.lexology.com/library/detail.aspx?g=c84a6d2d-d128-4ad4-b8ef-cac874bbdbd8? AND https://www.lawrbit.com/article/ipc-crpc-evidence-act-replaced-by-new-criminal-laws/ among others.

Why?Because all retained provisions were found to have stood the test of time and were still very much relevant.

Let us applaud this acknowledgment.

IT Act is at least 100 times more comprehensive and detailed .Do the math.

And we still have the old CPC.And myriad other laws.All seem to have stood the test of time.

7.Another tangent.The laughable part is the ‘’colonial laws’’ rant by many commentators.[1961 Act has its genesis and source code in 1922 Act.]This post truth narrative triggers us into irrationality.

Change what is not suited to times.Add.Delete.Modify.

But for rational reasons.Where does year of creation come into it?

And if that is the rationale,dear sirs, even A B C D is colonial.Do away with it and lets have only Hindi alphabet which 99% of Hindi speaking people cannot even recite.While at it,dear social media czars, move to remove Article 248 also which compels court language to be English.How absurd can we get?

8.Back to another vital direct issue.There are always savings clauses in new laws.5 lakh appeals pending as on date with the FAA ,about 90,000 with ITATs and a few thousand with HCs and SC.Provision of setting aside remains.How long will all these take to settle?At least a decade or more.So, we could not handle one law,and now we will handle two?Wonderful.

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CONCLUDING COMMENTS

Legal architecture of a country is the strongest pole on which the human conduct is regulated.It is neither a triviality nor a joke.The posts thereon must be with great degree of responsibility and understanding.Its a free country and all of us can have our views.But there has to be a sense of duty and patriotism while commenting thereon and must be preceded by scholarship before publication.What I saw here on Linkedin ,betrays all this –and more.

?ANNEXURES

?https://www.ptinews.com/story/business/review-of-income-tax-act-will-be-completed-in-given-timeframe-cbdt-chairman/1756427