Government of India

Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

New Delhi, 6th May, 2019

PRESS RELEASE

e-filing of Income Tax Returns registers an increase of 19%

There have been some incorrect reports in media pertaining to reduction in numbers of Income Tax Returns(ITR) e-filed during Financial Year(F.Y.) 2018-19 as compared to F.Y. 2017-18. This is factually untrue, because the figures for F.Y. 2017-18 and F.Y. 2018-19 are not directly comparable.

It is stated that during F.Y. 2017-18, out of a total of 6.74 crore ITRs which were e-filed, 5.47 crore ITRs were filed for Assessment Year(A.Y.) 2017-18 (the current year). In comparison, during F.Y. 2018-19, a total of 6.68 crore ITRs were e- filed which included 6.49 crore ITRs of current A.Y. 2018-19 marking an increase of almost 19%. This would imply that substantially larger number of taxpayers filed their ITRs electronically in the F.Y. 2018-19 as compared to F.Y. 2017-18. Furthermore, during F.Y. 2017-18, apart from the returns for the A.Y. 2017-18, nearly 1.21 crore ITRs were filed for A.Y. 2016-17. The balance number of ITRs filed for A.Y. 2015-16 and prior A.Ys is 0.06 crore. In comparison, during F.Y. 2018-19 only 0.14 crore ITRs for A.Y. 2017-18 were filed. Thus, the apparent decrease in the number of ITRs filed during F.Y. 2018-19 pertaining to earlier years was due to an amendment in Section 139(5) of the Income-tax Act, 1961 brought in vide Finance Act, 2017, w.e.f. 01.04.2018, which mandated that a revised return could be furnished only upto the end of the relevant Assessment Year. As a result, only 0.14 crore ITRs pertaining to A.Y. 2017-18 were filed during F.Y. 2018-19 as these were the revised ITRs for the relevant A.Y. which could only be filed due to change in law and no other ITR of any earlier A.Y. could be filed in view of the amended provisions of law.

These figures are also available in the Tab -> 'Filing growth' (A.Y.) on the e- filing website.

It is also stated that the number of paper ITRs for A.Y. 2017-18 was only 9.2 lakh (1.5% of total ITRs filed) and the number of paper ITRs for A.Y. 2018-19 is 4.8 lakh (0.6% of total ITRs filed). As per the above details, it is evident that most of the taxpayers have steadily switched to e-filing which is clear from the dwindling numbers of paper returns filed for A.Y. 2018-19 compared to earlier years.

 

(Surabhi Ahluwalia)

Commissioner of Income Tax

(Media & Technical Policy)

Official Spokesperson, CBDT.

 

Government of India

Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

New Delhi, 04th May, 2019

PRESS RELEASE

Income Tax Department conducts searches on a business group dealing in lotteries

Income Tax Investigation Directorate, Chennai conducted searches on a Coimbatore based business group handling the lotteries run by certain State Governments under agreements with them to function as a Marketing Agent. The search commenced on 30.04.2019 across 70 premises located in Coimbatore, Chennai, Kolkata, Mumbai, Delhi, Hyderabad, Guwahati, Siliguri, Gangtok, Ranchi and Ludhiana. The group is particularly active in lotteries of West Bengal and North - Eastern States where it has monopoly control. The group also has dealings in Real Estate and finance business in Coimbatore in a big way.

The group has been under the Department’s radar for quite some time due to the continuous and huge fall in its advance tax payments in the last two years. During the search, the assessee admitted unaccounted income of ₹ 595 crore received from stockists towards manipulation of PWT (Prize Winning Tickets). In respect of its real estate and finance business in Coimbatore, the assessee has also admitted to offer further unaccounted income to tax after reconciliation of the over ₹600 crore of unaccounted receipts (including on-money received in real estate and interest received on loans given) and payments made for various investments.

During the search, ₹8.25 crore of unaccounted cash was found, out of which ₹5.8 crore cash was seized. The remaining cash has been kept under prohibitory orders for further verification. Prima facie, unaccounted gold and diamond jewellery of an approximate value of about ₹24.57 crore was also found in the search which was also placed under prohibitory orders as verification is under process.

Prohibitory orders have been placed in several premises where incriminating evidence comprising a large volume of paper and electronic documents still remain to be examined.

(Surabhi Ahluwalia)

Commissioner of Income Tax

(Media & Technical Policy)

Official Spokesperson, CBDT.

 

HC: Employees’ contribution to the Employees’ Provident Fund (EPF) / Employees’ State Insurance Corporation (ESIC) deposited beyond the due date prescribed under section 36(1)(va) of the Income-tax Act, 1961 would not be eligible for deduction under section 43B of the Act, even if deposited before the due date of filing the return; HC notes that, the expression “within fifteen days of the close of every month” therefore must be interpreted as having reference to the close of the month, for which, the wages are required to be paid with corresponding duty to deduct employee's contribution and to deposit the same in the fund.

Click here to read and download HC judgement copy reported in [TS-7436-HC-2018(Gujarat)-O]

Government of India

Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

New Delhi, 22nd April, 2019

PRESS RELEASE

Note on search conducted in NCR on a group in the Power sector

The Delhi unit of the Directorate General of Income-tax (Investigation) initiated search and seizure action on a group in NCR, Bhopal, Indore and Goa based upon credible information of large scale collection, possession and movement of unaccounted assets, a few weeks back.

CBDT had earlier issued a press note pertaining to searches conducted in MP. As some new developments have taken place, this press release is being issued pertaining to search and seizure operation carried out in NCR on 07/04/2019 on a leading Solar Power group connected in the matter.

Some of the significant transactions detected during the search operation are detailed hereunder:-

a) Accommodation entries of Rs 370 crore: During the search, a maze of shell companies used as mere conduits for providing entries to the group have been detected. Accommodation entries in the garb of bogus unsecured loans/share application money to the tune of Rs. 370 crore have been found.

b)  Bogus billing of Rs. 330 crore: Evidence of inflation of expenses through bogus billing to the tune of around Rs. 330 crore has been detected in the case of a power plant of the said group. The money so siphoned off was collected in USD through hawala operators.

c) Unaccounted diary transactions of Rs. 240 crore: A handwritten diary containing records of out of books cash receipts to the tune of around Rs.240 crore was seized from the office of the group. The entries therein have been admitted by the persons concerned.

d) Bogus loans of Rs. 30 crore in a group company: Investigations reveal that a loan entry of Rs. 30 crore in one of the group companies was an accommodation entry arranged by an entry operator against equivalent cash.

e) Over-invoicing of imports and round tripping of Rs. 252 crore: During the search, evidence was found indicating that the group grossly over-invoiced its imports from original manufacturers by re-invoicing it through a shell company of a person who is an accused in a major defence scam. The surplus so created was ploughed back in the books as FDI through another shell company of the same person.

f) Unaccounted foreign investments/expenses: Enquiries reveal that the group used the services of a Dubai based operator to park unaccounted foreign remittances in overseas jurisdictions. Out of such remittances, approximately Rs. 27 crore was paid towards credit card expenses and Rs. 72 crore for purchase of a property abroad.

g) Apart from the above, unaccounted payment of Rs. 9 crore towards purchase of a property has also been detected.

h) Seizure of unaccounted assets of Rs. 3 crore has been made during the search.

The search action was undertaken on the basis of credible information and has led to detection of large scale tax evasion of more than Rs. 1350 crore.

(Surabhi Ahluwalia)

Commissioner of Income Tax

(Media & Technical Policy)

Official Spokesperson, CBDT.

 

Ministry of Finance

CBDT invites stakeholder comments on report pertaining to Profit Attribution to Permanent Establishment(PE) in India

Dated: 18 APR 2019

Central Board of Direct Taxes (CBDT) places the report of the Committee on Profit Attribution on online public domain and invites suggestions/comments to be furnished electronically within 30 days from the date of publication of the aforementioned document on the website of the Department. The document can be accessed at www.incometaxindia.gov.in and comments can be sent to email address: usfttr-1@gov.in.

Background:

Taxation of non-residents in India is governed by the provisions of the Income-tax Act, 1961 (“the Act”) and the provisions of the Double Taxation Avoidance Agreement(s) [DTAA(s)] concluded or adopted by the Central Government under the powers conferred under Section 90 or 90A of the Act, respectively. The business income of a non-resident can be taxed in India if it satisfies the requisite thresholds provided under the Act as well as the threshold provided in the applicable tax treaty, by a concept of Permanent Establishment (PE), which is defined in Article 5 of Model Tax Conventions and tax treaties. Under Article 7 in the Indian treaties, profits are to be attributed to the PE as if it were a distinct and separate entity on the basis of the accounts of the PE and where such accounts are not available to enable determination of profits attributable to the PE, the profits attributable to the PE can be determined under the domestic laws. For the application of this method, the Assessing Officer in India can resort to Rule 10 of Income-tax Rules, 1962.

Recognizing the significance of issues relating to attribution of profits to a permanent establishment as well as the need to bring greater clarity and predictability in the applicable tax regime, a Committee was formed to examine the existing scheme of profit attribution to PE under Article 7 of DTAAs and recommend changes in Rule 10 of the Income-tax Rules, 1962. The Committee has submitted its report and it has been decided to seek suggestions/comments of the stakeholders and the general public.

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DSM/RM/KMN

(Release ID: 1570902)