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Informist, Friday, Jul. 24, 2026

 

NEW DELHI – Finance Minister Nirmala Sitharaman Friday pulled up the direct tax department for huge number of disputes in appeals and pointed out that newer appeals are adding up as the reduction is happening at a slower pace. "The total pendency declined by over 34,000 cases to now 540,000 appeals. No good...I would have thought the pending appeals would have come down to less than 100,000. We still have 540,000 appeals. Three years ago, or four years ago...we had an exercise within our boards about how to reduce pending appeals," Sitharaman said at an event marking 167th Income Tax Day in Delhi.

 

The tax department was nudged to reduce avoidable disputes while improving certainty for honest taxpayers. "Reducing tax litigation has always been a focus area of the government's reform agenda. The department has also pursued this through clearer legislative drafting, simplification of procedural rules, greater use of technology, and standardisation of processes to minimise ambiguity and disputes besides taking specific steps to reduce litigation at first appeal level," Revenue Secretary Arvind Shrivastava said.

 

In August, the government had said it had tax arrears to the tune of INR 47.52 trillion under direct taxes. Out of the total, an amount of INR 31.26 trillion was locked up in litigation till the end of March 2025.

 

Sitharaman urged the tax department to deepen voluntary compliance while simplifying the taxpayer experience. "These priorities reinforce one another, simpler laws encourage better compliance, better services strengthen trust, and greater trust promotes voluntary compliance," she said

 

She asked officers of Central Board of Direct Taxes to further strengthen tax certainty at the implementation level. "The income tax department will play a vital role in improving ease of doing business, promoting compliance, and strengthening trust between taxpayers and the state," she told the officers attending the event.

 

Sitharaman highlighted the need for specialised training in artificial intelligence, data analytics, forensic accounting, international taxation, transfer pricing, digital assets, cybersecurity and advanced financial investigations. "As we continue to invest in world-class infrastructure, we must invest with equal commitment in building the knowledge, skills and leadership capabilities of our officers," she said.  End

 

Reported by Sagar Sen

Edited by Akul Nishant Akhoury

 

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