The Prime Minister, Dr Manmohan Singh, has set up an expert committee for examining issues on General Anti-Avoidance Rules (GAAR).
The committee has been asked to give final guidelines and a roadmap for implementation by September 30. The Government has already deferred the implementation of GAAR to April 1, 2013.
The Prime Minister’s Office has also tried to put a lid on the controversy over the draft guidelines issued on June 28.
It said, “At the PM’s behest, the Department of Revenue has put the draft guidelines on the Web.” Media reports had suggested that there was a difference of opinion between the PMO and the Finance Ministry on the issue. Interestingly, the PMO, in a statement issued on June 29, said that the GAAR guidelines that have been put up on the Government Web site from the official level of the Finance Ministry and shared with some stakeholders are only draft guidelines and have been put out for receiving wide-ranging feedback and for discussion purposes. These have not been seen by the Prime Minister and will be finalised with the approval of the Prime Minister, who holds the Finance portfolio, only after considering the feedback received, it said.
Now, the PMO statement issued on Friday said “The PM has approved the constitution of an Expert Committee on GAAR to undertake stakeholder consultations and finalise the guidelines.” This committee will be headed by Dr Parthasarathi Shome while Mr N. Rangachary, (Ex-Chairman, IRDA), Dr Ajay Shah (Professor, National Institute of Public Finance and Policy), and Mr Sunil Gupta (Joint Secretary, Tax Policy & Legislation, Department of Revenue) will be members.
Terms of references for the committee will include receiving comments from stakeholders and the general public on the draft GAAR guidelines. It will vet and rework the guidelines based on the feedback and publish the second draft for comments and consultations.
The committee will also undertake widespread consultations on the second draft GAAR guidelines.
After this, it will finalise the GAAR guidelines and a roadmap for implementation and submit these to the Government.
A time frame has also been finalised. The Committee will receive comments from stakeholders and general public till end-July.
Then it will vet and rework the guidelines based on this feedback and publish the second draft GAAR guidelines by August 31.
Accordingly, it will finalise the GAAR guidelines and a roadmap for implementation and submit these to the government by September 30.
Since there was a need to have “greater clarity on many other fronts,” this Expert Committee has been constituted, which will “bring transparency and a high degree of technical expertise to the consultation process,” the statement added.