<div>Finance Minister P Chidambaram said on 28 August that the Direct Taxes Code (DTC), initiated by him during his earlier tenure, needed a fresh look. After a meeting with top officials of Central Board of Excise and Customs (CBEC), he also said the tax department has to be firm with tax evaders for whom non-compliance is a business.<br /><br />"DTC has gone through various versions...I need time to look at DTC. I am only 28 days old... It requires a fresh look", Chidambaram said in reply to a question at a press conference.<br /><br />The idea of DTC, which seeks to replace the Income Tax Act, 1961, was mooted by Chidambaram as finance minister in the UPA-1 government and lot of drafting was done when he was shifted to home ministry in 2008.<br /><br />His successor Pranab Mukherjee introduced the DTC Bill in 2010 which also included a number of new provisions, followed by changes suggested by Parliament Committee on Finance. The controversial provisions relating to retrospective tax amendments and GAAR were enacted in the Finance Bill, 2012, which are under review.<br /><br />Chidambaram has already directed a review of retrospective amendments to the Income Tax Act. Media had reported earlier that the government’s take on recommendations to be given by the Parthasarthi Shome Committee on the General Anti-Avoidance Rules (GAAR) and the N Rangachary panel on taxation on IT sectors may be incorporated in the proposed Direct Taxes Code (DTC).<br /><br />On 28 August, to a question GAAR would get postponed again, Chidambaram said, he was awaiting the report of the Shome Committee, which is looking into the concerns expressed by foreign and domestic investors.<br /><br />On the indirect tax collections, the minister said that he was hopeful that the target of Rs 5.05 lakh crore during the current fiscal would be met. Chidambaram said the department would have to be firm with the small number of non-compliant businesses.<br /><br />"Most people would like to be compliant with tax laws. It is only a very small number that wishes to be non-compliant. I have told the department that we have to be firm with the small number of those non-compliant people", he said. <br /><br />The government is expected to soon announce some initiatives to boost investor sentiment and push exports which may miss the $360 billion target because of global economic uncertainties, commerce secretary S R Rao said at the CII Export Summit in Delhi on 28 August. (<strong>Read: <a href="http://www.businessworld.in/en/storypage/-/bw/steps-to-boost-investor-confidence-exports-soon/504179.37467/page/0">Steps To Boost Investor Confidence</a></strong>)<br /><br />"I am sure that the government is taking proactive steps. In the next 3-4 weeks, I expect significant policy announcements which should encourage our industry, our exports," said Rao.<br /><br />On becoming finance minister for the third time, Chidambaram had vowed to revive an economy he steered through the 2008 credit crunch with tax cuts. The buzz on his return to the ministry helped a market rally, further fuelled by a flurry of minor policy moves.<br /><br />India never fully unwound the consumer-oriented tax breaks that some economists say caused the economy to overheat. With inflation at close to 7 percent for 2-1/2 years and a yawning fiscal deficit in the cross-hairs of ratings agencies, India, like China, has little space for a new round of stimulus.<br /><br />India is expected to post April-June growth of 5.3 per cent on 30 August, matching the rate of the previous quarter and marking the deepest slump for nine years. (<strong>Read: <a href="http://www.businessworld.in/web/guest/storypage?storyUrl=no-fast-growth-rebound-for-india-amid-downgrade-fears&CategoryID=37467&articleId=504070&version=1.0&journalArticleId=504071">No Fast Growth Rebound</a></strong>)<br /><br />"If the GDP data prints below 5 percent, there may be some immediate depreciation pressure on the rupee," said M. Natarajan, head of treasury of Scotiabank in Mumbai.<br /><br />"However, if the equity markets subsequently start building in rate cut hopes, the rupee may gain to sub-55 levels."<br /><br /><a href="http://www.businessworld.in/web/guest/storypage?storyUrl=cbdt-forms-committee-to-screen-controversial-imp-tax-cases&CategoryID=37467&articleId=505438&version=1.0&journalArticleId=505439"><strong>CBDT Forms Committee To Screen Important Cases </strong></a><br />Meanwhile, in view of "contentious and controversial" legal cases like that of Vodafone faced by Income Tax department, the CBDT has created a committee of top Finance Ministry and I-T officials to understand the intricacies involved and present a sound case in court.<br /><br />By setting up Central Technical Committee (CTC), the Central Board of Direct Taxes (CBDT) aims to bring clarity on contentious legal issues and reduce litigation by adopting a consistent approach on them.<br /><br />"It has been observed that a large part of litigation in the direct taxes matters involves interpretation of legal provisions. Lack of desired clarity on contentious legal issues amongst the officers of the department sometimes leads to inconsistent approach on the same issue giving rise to further litigation.<br /><br /> </div>
