CBDT comes up with Stringent Norms for Scrutiny of Revised / Belated Returns filed Post-Demonetisation [Read Letter]

With a view to tackle black money holders, who tried to misuse the provisions for revising return or belated return after demonetisation, the Central Board of Direct Taxes (CBDT) has issued stringent conditions to be followed by the department while framing scrutiny assessments pertaining to such returns.

The Board pointed out some instances where the returns were revised or filed after due date by showing unsubstantiated reduction in closing stock, reporting higher sales, enhancing the amount of cash in hand, claiming additional cash inflow, etc, the Assessing Officer should consider certain things including analyzing the past-profile of the assessee.

The Board directed that in cases specified below, the department should compare the enhanced sales with the connected Central Excise/ VAT returns and should ensure that the details of the sellers are furnished by the assessee to the genuineness of the transactions.

In cases where the accounts are subjected to tax-audit, the omissions rectified in the returns were pointed out by the auditor. The source of cash in hand of the person who had made payment to the assessee must be verified.

Further, in the scenario pertaining to wealth tax returns of earlier years, it should be examined whether there is an attempt to build cash in hand or any other assets so as to justify the cash deposits post demonetisation.