sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
« Direct Tax »
 The impact & significance of tax changes
 Auction for Sale (Re-issue) of Government Stock (GS) February 15, 2019
 How to use it to pay tax online to avoid query from I-T Department
 Income Tax Return (ITR) filing: This much TDS you pay on income from Post office savings, PPF, Sukanya Samridhi, Kisan Vikas Patra saving account; but there's a catch
 How scrapping of tax on notional rent on second house will affect individual taxpayers
 Panel drafting direct tax law seeks 30-day extension
 Filled ITR but not submitted it till July 31? You'll have to re-fill using updated forms
 No tax refunds yet for 2018 returns
 Here's how your expenditure on education can fetch you tax benefit
 Govt likely to come up with fresh notification on angel tax in a week
 Income Tax department may become more tech friendly from FY20

CBDT allows taxman to widen certain 'limited scrutiny' cases
December, 04th 2018

The CBDT has issued a fresh directive on 'limited scrutiny' assessment cases allowing the tax officials to widen the scope of such probes if they receive "credible" information of tax evasion by assessees.

The policy-making body for the Income Tax Department, however, made it clear in its directive issued on Wednesday that such an enquiry will be specific to the allegation of tax theft that was flagged to the taxman by any other probe agency, in order to ensure that the assessing officer does not undertake a "fishing or roving" exercise resulting in harassment of the taxpayer.

The Central Board of Direct Taxes (CBDT), as per the directive, said it received "several" representations by field officials of the I-T Department in 'limited scrutiny' cases where they pointed out "specific" instances of tax evasion for the relevant year (2017-18) which was provided to them by other law enforcement, intelligence or regulatory agencies like the CBI, Enforcement Directorate (ED), DRI, Intelligence Bureau or markets regulator SEBI.

A 'limited scrutiny' exercise in tax parlance indicates to cases where the taxman has suspicion that some income of an assessee has escaped the tax net in lieu of a specific instance. The assessing officer (AO) then issues notice to the assessee for production of additional documents and proofs to review the case and such an exercise is to be completed in quick time and the taxman "cannot travel beyond" the specific issue under scrutiny.

The larger version of such an enquiry is known as 'complete scrutiny' and all such cases are picked by a computer-enabled system that flags certain cases based on their unique transactions profile.

The CBDT has said that it only picks less than 1 per cent cases, out of the total returns filed, for scrutiny every year.

As per the latest directive of the CBDT, accessed by PTI, it has allowed the taxman to examine issues arising from such information (provided by other probe agency) during the conduct of assessment proceedings in 'limited scrutiny' cases but only after prior administrative approval of their boss (concerned Principal Commissioner or Commissioner of the I-T Department).

It said such a decision was being made as the rules to undertake 'limited scrutiny' strictly "restricted" the taxman from undertaking a large enquiry or investigation except the specific issues concerned.

The CBDT also made it clear to tax officials across the country that this exemption does not mean that they can widen the scope of a 'limited scrutiny' case to a 'complete scrutiny' one and the latest directions were only to "facilitate consideration of those issues wherein specific information of tax evasion has been furnished by any law enforcement, intelligence or regulatory authority or agency."

"Therefore, in such 'limited scrutiny' cases assessing officer shall not expand the scope of enquiry/investigation beyond the issues(s) on which the case was flagged for 'limited scrutiny'...," the CBDT directive said.

It further asked the taxman to "duly record the reasons for expanding the scope of 'limited scrutiny' and this shall be approved by the Principal Commissioner or Commissioner-rank officer."

"The assessing officer shall issue an intimation to the assessee concerned that additional issue would also be considered during the course of pending assessment proceeding," the directive added.

It also asked the supervising officers to "invariably pick up such cases" for review and inspection so that the taxpayer is not harassed and no roving or fishing enquiry takes place against them.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2019 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Portal Design Website Design Portal Designing Website Designing Web Design Professional Portal Design Professional Website Design Professional Web Design Portal Design India Website Design India Portal Designing India Website Designing India Web Design India Professional Portal Design India Professional Website Design India Chicago Professional Web Design New York Professional Web Design California Website Design Florida Website Design New Jersey Website Design Britain UK Website Design London Manchester Website Design

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions