Ministry of Finance

Income Tax Department conducts searches on coaching institutes in Namakkal, Tamil Nadu

Dated: 12 OCT 2019

The Income Tax Department, conducted a search action on 11th October, 2019 in the case of a business group based in Namakkal, Tamil Nadu. The group is mainly into running of educational institutions, and coaching institutes for competitive exams like NEET, etc. The group comprises several partnership firms and a trust controlled by a closely knit group of individuals. The search action covered 17 premises including residential premises of the group's promoters. The premises are located in Namakkal, Perundurai, Karur and Chennai in Tamil Nadu.

The search was undertaken on the basis of intelligence that the group was indulging in substantial tax evasion by suppression of fee receipts received from students. The modus operandi was to receive part of the fees in cash and such cash receipts were invariably not entered in the regular books of accounts. Instead, such receipts were maintained in separate set of accounts. Incriminating evidence of such suppression of receipts has been found during the search in the form of accounts maintained in diaries, in electronic storage devices and also in the form of huge sums of unaccounted cash. It was found that cash was kept in lockers in banks in the names of employees who acted as benami or name lenders.

Significant amount of cash was found in a safe inside an auditorium in the main school premises. Unaccounted cash of about Rs 30 crore has been found and seized. The unaccounted receipts are deployed for acquiring immovable properties as personal investments which are then leased for long term to the trust for expanding to other towns. It was also found that highly priced faculty are hired and employed in the coaching institutes and they are paid outside the books. Based on preliminary findings, the undisclosed income of the group is estimated at more than Rs 150 crore. The search is still in progress.

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RM/KMN

(Release ID: 1587925)

 

Government of India

Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

Dated: 11th October, 2019

PRESS RELEASE

Income Tax Department conducts searches in Karnataka

                The Income Tax Department conducted search on 9th October 2019 on a prominent business group in Karnataka which runs multiple educational institutions. During the course of the search, the modus operandi of conversion of seats which were originally to be allotted by merit through counselling by MCC maliciously into institutional quota seats through dropout system has been unearthed.

Incriminating evidence has been found in the search, substantiating conversion of seats, commission payments to brokers and sale of seats in exchange of receipt of cash. Evidences of use of multiple agents for conversion of MBBS and PG seats have also been found. Diversion of funds in the form of payment of on-money for the purpose of purchase of immovable assets for the benefit of trustees has also been established including finding of cash in possession of seller, commission in the hands of broker and strong written and audio evidences found in possession of the concerned parties. Evidences of handling of such cash generated, diversion for construction of hotels have also been found. Hawala transactions relating to movement of such cash have also been established. A total of Rs.4.22 crore of unaccounted cash has so far been found including Rs.89 lakh in the house of the main trustee.

Certain students whose names were used in conversion of seats have made statements establishing the modus operandi. Agents have admitted to have aided in sale of seats, brokers have admitted to be witness and accomplice to diversion of such cash generated.

Modus operandi of making cash deposits in the accounts of certain employees & their families and diversion of them to fixed deposits which are used to services loans taken by trustees has been unearthed. Evidence has further brought to light the fact that trustees have opened bank accounts in the names of their employees to deposit some of the capitation fee received in cash. Fixed deposits amounting to Rs. 4.6 crore in the names of 8 employees made in the above manner have been seized. It was further found that the interest from such benami fixed deposits have been used to service the loans taken by the trustees in their personal capacity.

Evidences also reveal undisclosed investments in real estate. Overall the total undisclosed income detected so far is around Rs.100 crore considering the cash donations received for 185 seats averaging Rs.50 lakh to Rs.65 lakh per seat and total seizure of undisclosed assets of Rs. 8.82 crore. Further investigations are in progress.

(Surabhi Ahluwalia)

Commissioner of Income Tax

(Media & Technical Policy)

Official Spokesperson, CBDT.

 

Press Information Bureau
Government of India
Ministry of Finance

Dated: 07 OCT 2019

Revenue Secretary inaugurates National e-Assessment Centre of IT Department

 

Revenue Secretary Shri Ajay Bhushan Pandey inaugurated National e-Assessment Scheme (NeAC) here today in the presence of CBDT Chairman Shri P.C. Mody and Members Shri P.K. Das, Shri Akhilesh Ranjan and Shri Prabhash Shankar.

While inaugurating the NeAC, Shri Pandey said that it is matter of great pride and achievement for the Income Tax Department to bring NeAC to life in a small span of time. Retracing the origins of NeAC in 2017, Shri Pandey lauded the IT Department for striving to achieve transparency with speed.

Shri Pandey said that with the launch of National e-Assessment Centre (NeAC), the Income Tax Department will usher in a paradigm shift in its working by introducing faceless e-assessment to impart greater efficiency, transparency and accountability in the assessment process. He said that with NeAC, there would be no physical interface between the tax payers and the tax officers.

The setting up of NeAC of the Income Tax Department is a momentous step towards the larger objectives of better taxpayer service, reduction of taxpayer grievances in line with Prime Minister’s vision of ‘Digital India’ and promotion of Ease of Doing Business.

In the first phase, the Income Tax Department has selected 58,322 cases for scrutiny under the faceless e-Assessment Scheme 2019 and the e-notices have been served before 30th of September 2019 for the cases of Assessment Year 2018-19.

The taxpayers have been advised to check their registered e-filing accounts/ email ids and have been requested to furnish reply within 15 days. The Department hopes that with the ease of compliance for taxpayers, the cases would be disposed off expeditiously.

Benefits of Faceless Assessment:

• NeAC eliminates human interface between Assessing Officer and Assessee
• New System optimises the utilisation of resources through economies of scale
• NeAC introduces team based assessment with dynamic jurisdiction
• Ease of compliance for taxpayers
• Brings transparency and efficiency, thus improves quality of assessment and monitoring
• Functional specialisation as only one agency dealing with faceless assessment
• Expeditious disposal of cases
• Standardisation and quality management

About National e-Assessment Centre (NeAC) :

NeAC will be an independent office that will look after the work of e-Assessment scheme which is recently notified for faceless e-assessment for income tax payers. There would be a NeAC in Delhi to be headed by Principal Chief Commissioner of Income Tax (Pr.CCIT). There are 8 Regional e-Assessment Centres (ReAC) set up at Delhi, Mumbai, Chennai, Kolkata Ahmedabad, Pune, Bengaluru and Hyderabad which would comprise Assessment unit, Review unit, Technical unit and Verification units. Each ReAC will be headed by Chief Commissioner of Income Tax (CCIT). Cases for the specified work shall be assigned by the NeAC to different units by way of automated allocation systems. In view of the dynamic and all India jurisdiction of all officers of NeAC and ReAC, this kind of connective and collaborative effort of officers is likely to lead to better quality of assessments.

About Faceless e-Assessment: 

Centre Government had recently notified e-Assessment scheme to facilitate faceless assessment of income tax returns through completely electronic communication between tax officials and tax payers.

Under the new system of faceless e-Assessment, tax payers will receive notices on their registered emails as well as on registered accounts on the web portal www.incometaxindiaefiling.gov.in with real time alert by way of SMS on their registered mobile number, specifying the issues for which their cases have been selected for scrutiny. The replies to the notices can be prepared at ease by the tax payers at their own residence or office and be sent by email to the National e-Assessment Centre by uploading the same on the designated web portal.

This new initiative of faceless assessment is expected to increase ease of compliance for taxpayers as the cost and anxiety of taxpayers are likely to be greatly reduced. No human interface with the Department would be a game changer. This is another initiative by CBDT in the field of ease of compliance for our tax payers.

LINK: PPT Presentation for detailed information

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RM/KMN

 

 

FM to inaugurate National e-Assessment Centre of Income Tax Department Tomorrow

Shall usher introduction of Faceless e-Assessment in the Income Tax Department

New Initiative shall impart greater efficiency, transparency and accountability in the assessment process

Dated: 06 OCT 2019

The Income Tax Department is ushering in a paradigm shift in its working by introducing faceless e-assessment to impart greater efficiency, transparency and accountability in the assessment process. There would be no physical interface between the tax payers and the tax officers.

The setting up of National e-Assessment Centre (NeAC) of the Income Tax Department is a momentous step towards the larger objectives of better taxpayer service, reduction of taxpayer grievances in line with Prime Minister’s vision of ‘Digital India’ and promotion of ease of doing business.

Union Minister for Finance & Corporate Affairs Smt. Nirmala Sitharaman will inaugurate National e-Assessment Centre ( NeAC) in New Delhi tomorrow in the presence of Shri Anurag Singh Thakur, Minister of State for Finance & Corporate Affairs . Dr. Ajay Bhushan Pandey, Revenue Secretary, Shri Pramod Chandra Mody, Chairman, CBDT will also be present . Officers of the Income Tax Department and other dignitaries shall also be linked through Multimedia Video Conferencing at Mumbai, Chennai, Kolkata, Delhi, Ahmedabad, Hyderabad, Pune and Bengaluru.

Under the new system, tax payers have received notices on their registered emails as well as on registered accounts on the web portal www.incometaxindiaefiling.gov.in with real time alert by way of SMS on their registered mobile number, specifying the issues for which their cases have been selected for scrutiny. The replies to the notices can be prepared at ease by the tax payers at their own residence or office and be sent by email to the National e-Assessment Centre by uploading the same on the designated web portal.

This is another initiative by CBDT in the field of ease of compliance for our tax payers.

RM/KMN

(Release ID: 1587334)

 

Ministry of Finance

DIN system of CBDT launched ; About 17500 Communications with DIN Generated on First day

Dated: 01 OCT 2019

The Documentation Identification Number (DIN) system of Central Board of Direct Taxes (CBDT) has come into existence from todaywiththe generation of about 17,500 communications with DIN on the very first day. This path breaking DIN system has been created as per the direction of Finance Minister Ms. Nirmala Sitharaman and from now onwards every CBDT communication will have to have a documentation identification number.

Revenue Secretary Dr. Ajay Bhushan Pandey said, “From today, any communication from Income Tax Department without a computer generated DIN, be it a notice, letter, order and summon or any other correspondence,would be treated as invalid and shall be non est in law or deemed to be as if it has never been issued. The DIN system would ensure greater accountability and transparency in tax administration.”

“Now from today onwards, all such communications with DIN would be verifiable on the e-filing portal and no communication would be issued manually without DIN except only if it is in the specified exceptional circumstances”, said Dr. Pandey.

It would be pertinent to mention here that while specifying such exceptional circumstances the CBDT Circular related to DIN dated 14.08.2019 says thatwhenever any such manual communication would be issued, it would be necessarily required to specify reason of issuing such a communication without DIN along with the date of obtaining written approval of the Chief Commissioner/Director General of Income Tax in a particular format. Any communication which is not in conformity of with the prescribed guidelines shall be treated as invalid and non est in law.

CBDT has specified that any communication issued manually under exceptional circumstances would have to be uploaded and regularised on the system portal within 15 days of its issuance.

CBDT has also stated that all pending assessment proceedings, where notices were earlier issued manually, prior to the DIN related Circular dated 14.08.2019 coming into existence, all such cases would be identified and notices so sent would be uploaded on ITBA by the end of this month, i.e., by 31st Oct 2019.

This is in pursuance of the directions by the Hon’ble Prime Minister in which he has asked the Department of Revenue to come up with specific measures to ensure that the honest taxpayers are not harassed and served better. It may be noted that earlier there have been some instances where it was not possible to maintain the audit trail of the manually issued communication which in some cases caused inconvenience to taxpayers sometime. However, with the present system of attaching a DIN to every notice or communication of CBDT would result in better services to taxpayers without any possible harassment.

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RM/KMN
(Release ID: 1586901)