Government of India

Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

New Delhi, 13th August, 2019

PRESS RELEASE

CBDT rebuts incorrect reports about Income Tax notices to Durga Puja Committees

There have been reports in the media about Income Tax notices being issued to Durga Puja Committees in Kolkata recently. The reports also mention that Income Tax notices were sent to the Durga Puja Committee Forum in the last few weeks. It is unequivocally stated that the said reports are factually incorrect and are strongly denied. It is a fact that no notice was issued to the Durga Puja Committee Forum by the Department during this year.

However, as the Department had been getting information that several contractors who were doing work for the Puja committees were not paying due taxes, therefore notices under section 133(6) of the Income Tax Act, 1961 were issued in December, 2018 to about 30 committees, calling for details of tax deducted at source on payments made to contractors and event managers etc. engaged by the committees for the Puja events, including the TDS statement. This was part of an exercise carried out by the TDS wing of the Department to ensure that the contractors and event managers pay their due taxes in time. Many of the committees complied and furnished evidence of tax deducted at source as well as deposit of the same into the Government account.

It is also pertinent to state that several committees requested the Department to organise educative sessions to explain the provisions of TDS to the committees.

Taking a cue from the same, one such outreach programme was organised on the 16th of July, 2019 for the Durga Puja Committees at their own request. Nearly eight (8) members of the Forum attended the outreach programme voluntarily and were educated about the provisions of TDS. Their doubts pertaining to TDS provisions were also clarified.

It is reiterated that the aforesaid exercise is in no manner whatsoever against the Puja Committees, but has been undertaken to ensure that the contractors and event managers pay their due taxes correctly within the stipulated time.

(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, 10th August, 2019

PRESS RELEASE

Income Tax Searches in Tamil Nadu net more than Rs 700 crore

The Income Tax Department conducted a search and seizure operation on 06.08.2019 in the case of one of the major producers of beer and IMFL in Tamil Nadu. The search action was launched in the early hours of Tuesday at 55 premises in various places in Tamil Nadu including Chennai, Coimbatore, Thanjavur, etc and also in Kerala, Andhra Pradesh and Goa. The premises included residences of the promoters, key employees and some of the suppliers of materials.

The search action was based on intelligence gathered over several months that the business group was indulging in large scale tax evasion by inflating its expenditure on materials used in its production processes. During the search action, the search teams found telltale evidence of the modus operandi of the group. The modus operandi involved over-invoicing of purchase of raw materials and bottles which constituteda major portion of the cost of production. The suppliers received payment at the inflated value by cheque or RTGS, but paid back the excess value in cash to key confidante employees of the group. The search teams gathered evidence of such over-invoicing and return of cash by suppliers. Such inflation by over invoicing amounted to suppression of taxable income  of almost Rs 400 crore over a period of six years.

The search also resulted in unearthing of evidence of similar tax evasion by another leading business group in the same liquor industry. Consequently, the Department launched search operation in the case of the second group also on 09.08.2019. About seven premises of this group at Chennai and Karaikal were covered in the second phase of the search operation. The search is still in progress and the suppression of taxable income detected in this group has been estimated to be about Rs 300 crore.

Based on a tip off during the search action, the tax officers tracked down employees moving with unaccounted cash and intercepted them and recovered Rs 4.5 crore cash from the car in which they had concealed it. The search action has thus far resulted in detection of undisclosed income of Rs 700 crore which had not been disclosed for taxation.

(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, 10th August, 2019

PRESS RELEASE

Income Tax Department detects Benami business of running of petrol outlets in Meghalaya

In a swift and coordinated action on Friday, 2nd August 2019, the Investigation Wing of Income Tax Department. NER carried out searches on certain businessmen in Meghalaya, found to be involved in running a web of petrol pumps managed and controlled as benami properties. These persons were depriving the State Government of legitimate revenue by suppressing sales and non-deposit of local taxes collected, while also indulging in massive evasion of income tax by misusing exemption under Section 10(26) of the Income Tax Act , 1961 meant for tribal persons.

In the enforcement operation that commenced in the early hours and went on till wee hours of the next day, more than Rs 2 crore of unaccounted cash alongwith incriminating documents have been seized by officials of the Department. The cash found was hidden in unexpected places like water tanks.

This search by the Department was a much needed action on a long existing racket run by some unscrupulous elements exploiting local citizens of Meghalaya and avoiding paying income tax using tribal persons who are exempted from income tax, as a front. The pre-search investigation involved extensive surveillance and covert enquiries which were continuing for over a year.

Following the searches exposing these benami petrol pumps, the Executive Committee (EC) member of Khasi Hills Autonomous District Council (KHADC) in-charge of trade, announced to the media on the 8th of August, 2019 that urgent steps will be taken to prevent benami transactions in the State. He noted that despite the law, benami transactions are thriving due to collusion between some local people and their non-tribal business partners. The KHADC is a statutory autonomous body which regulates various aspects of trade and commerce in Meghalaya.

The action taken by the Department has been widely appreciated by the public and also local authorities as a timely and positive step that will help to control the menace of benami commercial activities, as well as augment Government revenues.

 (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, 10th August, 2019

PRESS RELEASE

CBDT simplifies the process of assessment in respect of Startups

The Finance Ministry has simplified the process of assessment in the case of Startup entities.

In cases where scrutiny assessments of Startup entities are pending, the CBDT has decided that:

i)In case of Startup Companies recognized by DPIIT which have filed Form No. 2 and whose cases are under “limited scrutiny” on the single issue of applicability of section 56(2)(viib),the contention of the assessee will be summarily accepted.

ii)In case of Startup Companies recognized by DPIIT which have filed Form No. 2 and whose cases have been selected under scrutiny to examine multiple issues including the issue of section 56(2)(viib),this issuewillnot be pursued during the assessment proceedings and inquiry on other issues will be carried out by the Assessing Officer only after obtaining approval of the supervisory authority.

iii)In case of Startup Companies recognized by the DPIIT, whichhave not filed Form No. 2, but have been selected for scrutiny, the inquiry in such cases also will be carried out by the Assessing Officer only after obtaining approval of the supervisory authorities.

In addition to the above, the Central Government has further decided to relax Para-6 of the DPIIT notification No.127 (E) dated 19.02.2019 and make it clear that this notification will also be applicable to Startup Companies where addition under section 56(2)(viib) has been made and the assessee has been recognized by DPIIT and subsequently filed Form No. 2. The Circular to this effect in F.No 173/149/2019-ITA-1 of CBDT dated 8th August, 2019, has been placed on www.incometaxindia.gov.in.

 

(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, 8th August, 2019

PRESS RELEASE

FAQs in respect of filling-up of the Income-tax return forms for Assessment Year 2019-20 issued

The Income-tax return (ITR) forms for the Assessment Year 2019-20 have been notified on 01.04.2019. Subsequently, queries have been raised by the stakeholders in respect of filling-up of the ITR forms. These queries are primarily in respect of the reporting of certain details in the ITR forms, such as reporting of directorship in a foreign company, reporting of equity shares listed outside India, unlisted shares which were previously listed, reporting of unlisted shares received by way of gift, will, amalgamation etc. and reporting of certain assets held as stock-in-trade.

The queries have been examined by CBDT and have been clarified vide Circular No. 18/2019 dated 08th August, 2019. A copy of the Circular has been placed on www.incometaxindia.gov.in

(Surabhi Ahluwalia)

Commissioner of Income Tax

(Media & Technical Policy)

Official Spokesperson, CBDT.