New Delhi: In a major development, the Income Tax Department has unearthed numerous instances of incorrect tax refunds under various sections of IT Act, involving employees across the country. These discrepancies surfaced during extensive search and seizure and survey activities conducted by the IT department.
Highly placed government sources told ETV Bharat that many individuals have been claiming incorrect deductions, u/s 80C, 80D, 80E, 80G, 80GGB, 80GGC, etc., in their ITRs, which has resulted in significant reduction in taxes payable to the Government of India.
Sources also said during investigations, it came to light that such individuals are employees of organisations operating in diverse fields including PSUs, Big Corporations, MNCs, LLPs, Private Limited Companies, etc. Further, verification has revealed that certain unscrupulous elements have misguided taxpayers for claim of incorrect deduction or refunds.
In view of such irregularities, the IT department has now intensified its efforts to ensure compliance with tax regulations. The department has been conducting outreach programmes with employers to spread awareness about the consequences of claiming incorrect deductions in the ITRs and corrective measures which can be taken by the taxpayers to rectify the errors of omission or commission.
As per data, till 31st December, 2024, approximately 90,000 taxpayers from PSUs and private sectors have withdrawn incorrect claims of deductions, amounting to nearly Rs 1070 crore in their ITRs, and have paid additional taxes.
A senior official said that as per the provisions of section 139(8A) of Income-tax Act, 1961, taxpayers can file updated returns on payment of some additional tax as prescribed under law rectifying the errors of omission or commission within two years from the end of the relevant assessment year, for A.Y. 2022-23 to 2024-25.
Sources further revealed that during various search & seizure and survey operations, it was found that several persons claimed bogus deductions in their ITR leading to reduction of tax payable to the Government of India. In response to these incidents observed, the department issued guidelines for verification by Investigation Directorates and SOP for verification by TDS and Jurisdictional Assessing Officer (JAO).
Investigation of email clusters revealed that in most cases, clusters pertained to individuals who were working in some common organizations. Field offices were requested to obtain a list of common employers which have been identified during the course of investigation into e-mail based clusters from respective Principal Director of Income Tax (Investigation) charges under the jurisdiction and to conduct outreach programmes, sensitizing employers regarding the wrong claims of deductions in the ITRs.
Sharing insights with respect to fraudulent claims of deductions in the ITRs after analysis of the information with the department, CBDT said that there is a vast mismatch between total deductions u/s 80GGB/80GGC claimed by taxpayers in their ITRs as against the total receipts shown by the donees in their ITRs. Similarly, deductions claimed u/s 80C, 80E, 80G also appeared to be suspicious in nature.
On the basis of a thorough analysis of all available resources, a list of common employers (TDS deductors) has been identified. The list has been identified keeping in mind the objective of reaching out to as many persons as possible who are suspected to have claimed bogus deductions u/s 80E, 80G, 80GGA, 80GGC and other deductions.
