The Income Tax Department (Telangana and Andhra Pradesh) on Friday discovered a large number of individuals who have incorrectly reported exemptions and deductions as part of its monitoring efforts to verify the accuracy of tax returns submitted by taxpayers. These taxpayers have claimed refunds based on these incorrect declarations.
Principal Chief Commissioner of Income Tax, Andhra Pradesh & Telangana Mitali Madhusmita addressed a press conference on the issue of suspicious refunds being claimed by some taxpayers, in Hyderabad.
The Press Information Bureau (PIB) in Telangana, on July 7, 2023 tweeted, "Under the Income-tax Act,1961(the 'Act') there are stringent consequences of misreporting of income and claiming wrongful deductions. Those include interest @ 12% /yr, penalty @ 200% of taxes, prosecution which may entail imprisonment. Who have filed such claims and taken wrongful refunds from the Department can file Updated Returns u/s 139(8A) for AY 2021-22 & AY 2022-23 and deposit due taxes as per section 140B. For AY 2023-24, Revised returns can be filed u/s 139 (5) in those cases where original return has already been filed." [sic]
Under the Income-tax Act,1961(the 'Act') there are stringent consequences of misreporting of income and claiming wrongful deductions. Those include interest @ 12% /yr, penalty @ 200% of taxes, prosecution which may entail imprisonment
July 7, 2023
-Pr Chief Commissioner, @IncomeTax_APTS
1/2 pic.twitter.com/wqaA9qG9FxFor AY 2023-24, Revised returns can be filed u/s 139(5) in those cases where original return has already been filed.
July 7, 2023
-Smt. Mitali Madhusmita, Pr Chief Commissioner, @IncomeTax_APTS#IncomeTaxReturn #IncomeTax pic.twitter.com/j6DE8ulmx6What is Misreporting of Income
The following cases will be considered as misreporting of income:
Misrepresentation or suppression of facts.
Failure to record investments in the books of account.
Claim of expenditure not substantiated by any evidence.
Recording of any false entry in the books of account.
Failure to record any receipt in books of account having a bearing on total income.
Failure to report any international transaction or any transaction deemed to be an international transaction or any specified domestic transaction.
Penalty for misreporting of income
Under the Income-tax Act, penalties are levied for various defaults committed by the taxpayer. Some of the penalties are mandatory and a few are at the discretion of the tax authorities. Many times a taxpayer may try to reduce his tax liability by misreporting of income. In such cases, the taxpayer shall be liable for a penalty at the rate of 200% percent of the tax payable on such misreported income.
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