In its continuing action against fraudulent tax deductions, the Income Tax (I-T) Department has found fresh cases of manipulation even after taxpayers were given the opportunity to correct their returns. According to officials, a number of individuals who had previously claimed deductions for political donations under Section 80GGC of the Income Tax Act have simply withdrawn those claims and shifted the same amounts to other deduction categories such as home loan interest and education loans.
Earlier, the department had identified approximately 200 individuals whose high-value claims were suspected of being linked to tax evasion totalling 35 crore. Emails were sent to these individuals informing them that, during the verification of their income tax returns for the assessment years 2022–23 and 2023–24, deductions under Section 80GGC were found to be suspicious. Many of these claims, some running into lakhs of rupees, mentioned donations to both registered political parties and registered unrecognised political parties.
After the Mumbai zone, the Telangana-Karnataka zone recorded the second-highest value of declared deductions under Section 80GGC. Of the 7,124 crore in deductions declared across the country, 1,641 crore came from this region. Within this zone, 15,223 employees in Telangana were suspected of having falsely claimed deductions for political donations.
Despite the department offering a voluntary compliance window that encouraged taxpayers to withdraw incorrect...
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