I-T Dept names and shames 24 defaulters owing Rs 4.9 bn in taxes

The Income-Tax Department on Thursday released a pan-India list of 24 defaulting individuals and companies who owe about Rs 4.9 billion in taxes to the exchequer but have either gone untraceable or have reported inadequate assets for payment of dues.
The department issued an advertisement as part of its name and shame defaulters policy in leading national dailies titled 'List of defaulters of Income Tax and Corporate Tax'.

The notice, issued by a nodal office of the Principal Director General of Income Tax in Delhi, "advised" the named defaulters to pay their tax arrears immediately.
The public announcement carries the identity of the firm or the individual, the name of their directors and partners, the date of incorporation of the company (date of birth in case of individuals), their Permanent Account Number (PAN) or the Tax Deduction Account Number (TAN), their last known address and business profile, the amount of tax-defaulted, assessment year and the respective jurisdictional I-T authority.
These defaulting firms were in the business sectors like food processing, bullion trading, software, real estate, breweries and manufacture of ingots among others.
The maximum tax dues of over Rs 862.7 million is against a Delhi-based company named Ms Stock Guru, India and its partner Lokeshwar Dev and the notice said the assessee has gone untraceable and also has inadequate assets to pay the income tax.
The dues for this firm are for the assessment years (AYs) 2009-10 and 2010-11. Some of the defaulters on the list have not paid their taxes for the assessment year 1989-90.
A Kolkata-based individual Arjun Sonkar, as per the notice, has an I-T default of over Rs 51.37 crore and is "not traceable" now. He is followed by Kishan Sharma, another individual from the West Bengal capital, who the department said is in default of Rs 47.52 crore of income tax.
The total tax default amount by 24 entities, from cities like Ahmedabad, Guwahati, Vijaywada, Nashik, Surat, Delhi, Vadodara, Kolkata and others, is about Rs 4.90 billion.
A senior I-T Department official said the public list is aimed to make people aware so that they can help the department in nabbing these defaulters, if they have any information about them.
The notice also carried a disclaimer that the "entries in the list are specific to the tax arrear/assessment year mentioned and the tax defaulter's address, business, shareholding and management may have changed" now.
It added that the amount of default "shall further increase" after due interest is levied on it.
The department has carried out this exercise over the last few years andhad named 96 such entities which have huge tax liabilities on them but they have either gone non-traceable or have shown no assets for recovery.
The Central Board of Direct Taxes (CBDT), the policy-making body of the I-T department, had few years back adopted the strategy of bringing out the names of chronic defaulters in public domain and had also begun posting these names on its official website.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

I-T Dept probes Rs 10-bn tax refund fraud by govt and PSU employees

With less than a month left for revising income-tax (I-T) returns for 2016-17, the I-T department has unearthed a giant fraud in multiple cities, where government employees allegedly claimed huge tax refunds forging documents, inflating expenses and not revealing complete information.
In Mumbai alone, around 17,000 revised returns have been filed claiming refunds. Similarly, in Bengaluru, the I-T department has found over 1,000 returns filed with inflated claims on account of payments towards home loans.
Since the I-T department is still investigating the matter, the loss to the department could not be ascertained, but it could go up to over Rs 10 billion, sources said.
They added most of these refunds were being claimed by employees working for the government or in public sector undertakings (PSUs).
“These assessees’ original returns were already processed by the centralised processing centre of the I-T department. But they filed revised returns, claiming refunds with supporting documents,” said an I-T official.
A red flag was raised when the tax department noticed a pattern over three years. “The rate of revised tax returns filing has seen a significant rise in the last three years. We have identified these assessees from our data mining system. We were able to find how people claimed refunds by furnishing forged documents,” said a senior I-T official privy to the development.
“Assessees can file revised or deferred returns for the previous two financial years.
For instance, a taxpayer can revise returns for 2015-16 and 2016-17 till March 31, 2018,” explained a tax assessment officer.
Explaining the modus operandi, an I-T official said some of these assessees showed no income in their original tax returns under the head ‘income from house property’, but claimed losses in revised returns.
Under Section 24 of the I-T Act, home loan interest is allowed as a deduction. In the absence of income from house property, it becomes a loss from house property, leading to a refund. I-T officers claim the tax evasion takes place by inflating expenses, not revealing complete information and forging documents.
Since most of these revised returns were being filed by government and PSU employees, the tax department had shared the information with the Central Bureau of Investigation to examine whether the people under scrutiny had unaccounted wealth and also to probe potential connivance of some of the tax sleuths and chartered accountants.
Tax officials said that in case of revised returns, the system automatically generates a message that draws the attention of the person processing the refunds and also assessing officers who approve the refunds.
The I-T department had till February 10 issued refunds to the tune of Rs 1.42 trillion. Over 41.9 million I-T returns were processed and refunds were issued to 16.2 million taxpayers till February 10.
Typically, the I-T department gives priority to small taxpayers who claim refunds below Rs 50,000. Official data suggest of all the refunds issued so far in this fiscal year, 90% were to small taxpayers and the salaried class.