Scrutiny must be specific: CBDT

In an attempt to end taxpayers grievances, CBDT has asked the taxman to “expeditiously” complete those scrutiny cases where income concealed is upto Rs 5 lakh.

It has asked the assessing officers (AOs) to confine their queries for which the case has been picked up for scrutiny under the ‘limited’ category, which pertains to cases with income upto Rs 5 lakh and in the four metro cities, besides Bengaluru, Hyderabad and Ahmeda-bad the limit is Rs 10 lakh.

“Limited scrutiny cases shall remain confined only to the specific reasons/issues for which case has been picked up for scrutiny. The scope of enquiry shall be restricted to the limited scrutiny issues. These cases shall be completed expeditiously in a limited number of hearings,” the latest CBDT directive issued in this regard on Tuesday, said.

The IT department brings about one or two per cent of cases under the stringent scrutiny assessment procedures where, on the basis of credible information, it has suspicion that the taxpayer has under-reported or hidden his true income.

The scrutiny procedure, while used only for a select number of cases, has been a constant issue of grievance for taxpayers as they complain that the taxman harasses them with long queries and number of time-taking appearances.

There are two kinds of scrutiny in the tax department, ‘limited’ and ‘complete’, and the new directives have asked that the AO “has to intimate the reason for selection of case for scrutiny to the assess concerned” in all cases. The new instructions, officials said, have been issued to further redress and mitigate taxpayers grievances.

In cases of ‘complete’ scrutiny, the CBDT said, the AO will have to take clearance from his superior before taking up the case. In an another directive, the CBDT has told the IT department that notices for scrutiny should contain the details of specific information which are to be furnished by the taxpayer to the AO.