The Income Tax Department is likely to scrutinise tax returns of over 700 top companies, which include A-group category companies listed on the Bombay Stock Exchange and NSE-500, to detect possible tax evasion.
As part of the Finance Ministry's efforts to meet the target of corporate and income tax collections for the current fiscal, all NSE-500 companies and BSE A-group companies listed as on March 31, 2007 will be "compulsorily scrutinised", official sources told the media.
At present, 217 companies are listed at BSE under the A-group.
Under the scrutiny process, the Income Tax Department can send notices to the firms to explain any discrepancy in the information provided through tax returns filed, advance tax deposits, tax deduction at source (TDS), and their income and expenditure for up to three years.
For the returns filed till July 31, the sources said, the Income tax officers can serve the scrutiny notice any time on or before July 31, 2008.
Under the annual action plan, recently approved by the Finance Ministry, the Central Board of Direct Taxes (CBDT) is understood to have directed the Chief Commissioners, Income Tax, to scrutinise the returns of these companies to ensure that they deposited all due taxes, and in time.
The sources said all stock brokers and commodity brokers as well as their sub-brokers earning Rs 1 crore or more in brokerage will also be brought under the scrutiny net.
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