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Wednesday, August 05, 2020

Income-Tax department to share account data with intel, probe agencies

The recent notification will permit the tax department to share information of a taxpayer which might be relevant for the notified enforcement agencies.

By: ENS Economic Bureau | New Delhi | Updated: July 24, 2020 6:33:50 pm
income tax, income tax filing, income tax data sharing, income tax information, CBDT, tax assesses, tax details, income tax filing last date  At present, the Income Tax Department shares information about tax assessees with over 50 notified agencies.

The Central Board of Direct Taxes (CBDT) has notified four agencies — Cabinet Secretariat, Intelligence Bureau, Narcotics Control Bureau and National Investigation Agency — for disclosure of information regarding tax assesses under Section 138 (1) of the Income-tax Act.

At present, the Income Tax Department shares information about tax assessees with over 50 notified agencies, including Registrar of Companies, Director, Financial Intelligence Unit, officers of the rank of Joint Director and above dealing with Foreign Exchange Management Act and Prevention of Money Laundering in the Enforcement Directorate and Securities and Exchange Board of India. Read in Malayalam

Other officials such as Class I Officers, Reserve Bank of India (regional office, Ahmedabad), Karnataka State Vigilance Commission (Bangalore), officers of or above the rank of superintendent of police in the Department of Vigilance, Government of Bihar, Director/IGP, Anti-Corruption Bureau, Government of Maharashtra, Uttar Pradesh Vigilance Commissioner, Director, Anti-Corruption Bureau, Gujarat, Joint Secretary (Marketing), Ministry of Petroleum and Natural Gas, Inspector General of Police, Economic Offences Wing, Kerala, officers of the rank of secretary in various states/union territories responsible for implementation of the National Food Security Act, 2013 have also been among the list of agencies notified earlier under this section of the I-T Act.

The recent notification will permit the tax department to share information of a taxpayer which might be relevant for the notified enforcement agencies. “This section authorises CBDT to share information with other departments. Some agencies have been notified earlier as well for exchange of information regarding assessees. Inclusion of enforcement agencies might help track those who could be having illicit income or income from terror-related activities but may be generally skipping the radar of agencies,” Naveen Wadhwa, DGM, Taxmann said.

Section 138(1) of the I-T Act states, “The Board or any other income-tax authority specified by it by a general or special order in this behalf may furnish or cause to be furnished to — (i) any officer, authority or body performing any functions under any law relating to the imposition of any tax, duty or cess, or to dealings in foreign exchange as defined in clause (n) of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999); or (ii) such officer, authority or body performing functions under any other law as the Central Government may, if in its opinion it is necessary so to do in the public interest, specify by notification in the Official Gazette in this behalf…”

Earlier, the Income-tax Act provided for sharing of information on income tax assessees with other notified agencies, but then it meant that information could only be passed to a person who was an assessee with the Department and that too when the assessment relating to information to be furnished had been completed. This anomaly, which was restricting automatic exchange of information for assessees which might be showing income below exemption limit, was corrected in 1990, when the tax department amended the law to allow exchange of “any information received or obtained by an income-tax authority”.

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