There has been an increase in detection of suspicious refund claims in the last few years while the total amount of I-T refunds during 2018-19 (up to February 2, 2019) stood at Rs 1.43 lakh crore, Minister of State for Finance Shiv Pratap Shukla said on Tuesday.
In a written reply to a question in the Rajya Sabha, he said suspicious income tax refund claims have gone up in the last three years and scrutiny assessments have been initiated against taxpayers claiming high refunds inconsistent with the pattern of income and investments. The total amount of I-T refunds during 2017-18 stood at (Rs 1.51 lakh crore), 2016-17 (Rs 1.62 lakh crore) and 2015-16 (Rs 1.22 lakh crore).
In a separate reply, the minister said the number of Income Tax Returns (ITRs) filed in 2018-19 up to January 2019, was 6.36 crore, a rise of over 37 per cent. Over 4.63 crore ITRs were filed during the corresponding period of 2017-18.
"About 25 crore SMSes and e-mails were sent to taxpayers in 2018-19 reminding them to submit their ITRs in time. In addition, advertisements were also placed in newspapers for timely submission of ITRs.
Parliament was informed that the number of suspicious refund claims selected for scrutiny stood at 20,874 in 2018-19, 11,059 in 2017-18 and 9,856 in 2016-17.
"Scrutiny assessments have been initiated against taxpayers claiming high refunds inconsistent with the pattern of income and investments. Wherever after scrutiny the claim of refund was found to be inadmissible, the same was denied and consequential action of penalty and prosecution was taken based on the merits of the case," he said.
The minister said the I-T Department has also incorporated certain risk parameters in its system which prevents refunds from being automatically cleared in cases where suspicious refund claims are made in tax returns, especially those which are filed from a single IP address or from a single locality or by a single intermediary.
"Such cases are then examined for possible selection in scrutiny or for electronic verification from the taxpayer. Swift action is taken by the Department against persons found to be involved in any malpractices related to refunds," Shukla said.
"A provision for levy of fees of up to Rs 10,000 for late filing of ITRs has also been introduced with effect from 2017-18 to discourage late filing of return," Shukla said.