Mizoram traders seek halt on tax notices, claim legal exemption

Aizawl, March 29: The Mizoram Merchants Association (MIMA) has called on the Income Tax Department to halt the issue of tax notices to Mizo traders, asserting that they are legally exempt under the Income Tax Act. The appeal was made in a representation submitted to Nav Ratan Soni, Principal Chief Commissioner of Income Tax, North Eastern Region (NER), Guwahati, during his visit to the State.

At a stakeholders' meet attended by Central YMA, MIMA, chartered accountancy firms, Aizawl Treasury, and NICDL, MIMA voiced concern over repeated notices from the Income Tax Department, which have caused distress among Mizoram's business community.

The association pointed out that Mizos, as STs, are exempt from income tax under Section 10(26) of the Income Tax Act. However, many traders have been receiving notices, demanding tax filings, including for financial years dating back more than a decade. The retrospective nature of these demands, despite the submission of tax exemption, tribal, and residential certificates, has placed an undue burden on them.

MIMA also highlighted cases where some traders had their bank accounts frozen due to non-compliance with the notices. The association strongly opposed such actions against individuals who are legally exempt from taxation.

The requirement to file nil returns was also raised. MIMA stated that many traders, unaware of the process, had been pressured into unnecessary financial payments.

The additional cost of hiring chartered accountants for nil return filings was seen as an unfair burden on those already exempt from tax.

Even after providing all necessary documents, traders continue to receive repeated notifications from the Income Tax Department, MIMA alleged. It urged the authorities to put an end to this practice and ensure that Mizoram's tax-exempt status is respected.

- By Correspondent