Erroneous notices are sent to taxpayers: Unable to respond online due to glitches in I-T portal

Since its launching on June 7, the redesigned portal developed by Infosys has had problems with establishing passwords, integrating data from previous filings, and filing returns.

If your tax return for the financial year 2019-2020 was pending for processing, check your emails or give your chartered accountant a quick call to see if a notice was delivered. It’s likely that the notification will refer to you being denied a tax benefit even though you are eligible for it.

For example, based on the amount he got for the financial year 2019-20, a person declared a rental income of Rs 3.24 lakh. Instead of accounting for rental income, the system thought that person had requested a house loan interest deduction and added Rs 5 lakh to his overall income.

A woman from Delhi also submitted a late return. So, except for the loss on house property, no other losses can be mitigated under the delayed returns rule. “Even if she claimed loss from house property, the notice says the loss from house property cannot be claimed because the return was filed late.

Several chartered accountants have received notices for their customers, thus these are not unique incidents. “We are receiving a large number of notices under Section 143 that are incorrect.

These warnings are primarily for the complicated and late returns that were pending processing last year, with many refunds being delayed by at least 7-8 months.

What is the new income tax portal?

The Income Tax Department announced in May that on June 7, it would debut its new e-filing system http://www.incometax.gov.in. It said the “new taxpayer-friendly platform” would be combined with “instant processing of Income Tax Returns” to provide taxpayers with rapid refunds, with all interactions, uploads, and pending activities presented on a single dashboard. The portal was also supposed to offer free ITR preparation software with interactive questions to assist taxpayers in select categories, as well as a new call centre to respond to issues quickly.

The contract to construct the new system to cut return processing time from 63 days to one day and expedite refunds was granted to Infosys in 2019.

What is Section 143?

When the income tax department’s Central Processing Centre checks the data in your tax returns, you will receive an intimation under Section 143(1). They attempt to check for inconsistencies or errors in tax calculation at this point, and notify the taxpayer of the error via a Section 143 notice.

The erroneous warnings mailed out this month for returns filed last year cover a wide range of categories, not simply house property taxes.

IT Portal Glitch & Issues

Before : The portal began to have challenges within hours of its launch on June 7, including the inability to create an OTP for Aadhaar validation, password generating flaws, failure to link old data for earlier returns, and issues filing returns. The issues have now spread to include interest calculation errors, inaccurate Form 16 data capture, and the inability to add details for tax exemption for trusts. Individual taxpayers also complained about their ITR-1 not being accepted even days after filing, their inability to e-verify their ITR after filing, Form 26AS details not being automatically supplied, and the portal not having a secure connection and taking too long to load.

Presently Glitch : Denial of genuine tax benefits, as well as extra demands to which taxpayers are unable to respond due to difficulties in the new tax system, have added to their woes.

Unable to respond : You must react to such a notification by refiling your income tax return in accordance with the IRS’s recommendations.

“Normally, we must remedy any errors or explain why the tax claim is justified and should be reconsidered. However, when we try to respond to the notice through the new tax portal, it is rejected,”

Within 30 days of receiving the notice, you must react. Taxpayers and chartered accountants, on the other hand, are powerless since the submit tab isn’t working after they’ve filed the response.

“People have received the notices, but we are unable to respond because the new tax portal is down.

How the government intervene into this?

“The much-awaited e-filing portal 2.0 was launched last night at 20:45hrs,” Sitharaman tweeted the morning following the debut in June. I notice flaws and issues in my TL. I hope @Infosys and @NandanNilekani do not disappoint our taxpayers with the kind of service they give. The taxpayer’s ease of compliance should be our first priority.”

“The new e-filing portal will ease the filing process and increase the end-user experience,” Nilekani, the Infosys CEO, responded on Twitter. We noticed some technical challenges on day one, @nsitharaman ji, and are working to rectify them. @Infosys laments the system’s first hiccups and anticipates that it will be stabilized by the end of the week.”

As a result, the Internal Revenue Service had to accept manual filing of remittance forms and extend the deadlines for electronic submission of intimation forms by pension funds and sovereign wealth funds.

Finance Ministry officials held two meetings with Infosys MD & CEO Salil Parekh, following over two-and-a-half months of persistent difficulties in the new e-filing platform of the Income Tax Department, and its unavailability over the last few days. Nirmala Sitharaman, the Finance Minister, summoned Parekh for the second time in two months to explain the reasons for the ongoing problems, and has given Infosys till September 15 to fix them.