The Income Tax Department Sent 1 lakh Notices For Not Filing Income Tax Returns, Misrepresentation of Income

Union Finance Minister Nirmala Sitharaman: Some people received notices from the tax department because their income was close to Rs. 50 lakhs. These notices are expected to be resolved by the end of this financial year.

At a glance: The IT department issued 1 lakh notices to those with income close to Rs. 50 lakhs who didn't file returns or misrepresented income. The cases aim to be resolved by this fiscal year's end. Over 4 crore ITRs were filed for FY 2022-23, with Rs. 80 lakh refunds issued. However, a manpower shortage in the Income Tax department is causing work delays. A senior officer appealed for approval of the cadre restructuring proposal. 

On the occasion of the 164th Income Tax Day, Union Finance Minister Nirmala Sitharaman revealed that the government has issued 1 lakh notices to individuals who did not file their tax returns or misrepresented their income. 

These notices were sent to those whose income was found to be close to Rs. 50 lakhs. The government aims to resolve these cases by the end of the current fiscal year.

Union Finance Minister further added that the notices sent were not done thoughtlessly. She received assurance from the chairman of the Central Board of Direct Taxes (CBDT) that all these cases would be cleared by March 2024.

Officials confirmed that the notices were sent over the past 14 months, primarily to individuals with an annual income exceeding Rs 50 lakh. According to income tax law, officers can reopen past assessments for up to 6 years.

The CBDT completed a scrutiny assessment of 55,000 notices sent in accordance with a Supreme Court judgment in May 2023.

Sitharaman emphasized that the current approach is crystal clear, and the board is not holding back on addressing the issued notices. The system is designed to prevent misuse or manipulation.

Earlier, taxpayers were required to maintain records for 10 years, but now tax assessments can not be reopened after 6 years. Assessments in the fourth, fifth, and sixth years can only be reopened under certain circumstances, as per Sitharaman.

During the same session, Nitin Gupta, the chairperson of CBDT, reported that for the fiscal year 2022-23, more than 4 crore income tax returns (ITR) were filed, and over half of these ITRs have been processed, resulting in Rs. 80 lakh worth of refunds.

Gupta also mentioned that there is a failure of work due to a shortage of manpower in the Income Tax department. The senior officer appealed to Union Finance Minister Nirmala Sitharaman for prompt approval of the cadre restructuring proposal. 

Also Read: Income Tax Department Puts Clarification On The Inoperability of PAN Cards For Certain NRIs

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