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Deposits scrutiny a challenge, says ex-CBDT chief -Vikas Dhoot

-The Hindu

“We have around 45 crore bank accounts and if 1% of such accounts are picked up for scrutiny, that itself will make 45 lakh cases. Is it humanly possible? No chance”.

Former Central Board of Direct Taxes chairperson Sudhir Chandra, who headed a high-level committee to tackle the black money menace back in 2011, has said that the Income Tax department will find it challenging to scrutinise all cash deposits in bank accounts, following the demonetisation of high-value currency notes.

“We have around 45 crore bank accounts and if one per cent of such accounts are picked up for scrutiny, that itself will make 45 lakh cases. Is it humanly possible? No chance,” Mr. Chandra said. Even if each of the 4,000-5,000 officers in the IT department handled 100 cases each, such scrutinies could take a long time to complete.

As per the existing Income Tax Act of 1961, there is a two-year time limit set for assessing officers to complete a taxpayer’s assessment once her or his case is picked up for scrutiny, Mr. Chandra said.

“It has to be concluded within two years. How will that take place? So the department will have to be very, very selective. One per cent of bank accounts doesn’t seem viable, so maybe 0.001 per cent [should be checked],” he said.

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