CAG Detects Errors Worth Rs 4,000 Crore in Corporate Tax Assessments

 

The Comptroller and Auditor General (CAG) has pulled up the Central Board of Direct Taxes (CBDT) over significant errors or irregularities in corporate tax assessments in Parliament on 21st December, 2021.

CAG, in a report tabled in Parliament, audited 356 high value cases pertaining to Corporation Tax with tax effect of Rs 12,476.53 crore. It found errors worth Rs3,976.56 crore. Mainly they were arithmetical errors, irregularities in allowing depreciation, irregular deduction and incorrect allowance of business expenditure.

“These cases mainly pertained to arithmetical errors in computation of income and tax, errors in levy of interest, irregularities in allowing depreciation/business losses/capital losses, irregular exemptions/ deductions/ rebates/ relief/MAT credit, incorrect allowance of business expenditure, income not assessed/under assessed under normal provisions, etc,” the report said.

Further, CAG said, CBDT may examine whether the instances of errors noticed are errors of omission or commission and if these are errors of commission, then CBDT should ensure necessary action as per law.

However, the CAG has also noted that collection from corporate tax decreased by from Rs 6.63 lakh crore (2018-19) to Rs 5.57 lakh crore (2019-20). While, income tax collection increased from Rs 4.62 lakh crore (2018-19) to Rs 4.80 lakh crore (2019-20). The number of corporate assessees also decreased from 8.46 lakh to 8.38 lakh in the same period.

Besides recommending a probe, the CAG has said the errors point to weaknesses in the internal controls in the CBDT which need to be addressed. The CBDT should also put in place a fool-proof IT system to avoid recurrence of such errors in the future, it advised.

Source:


Knowledge Source :

Income Tax Collections Raise Over 60% in FY22

Leave a Reply

Your email address will not be published. Required fields are marked *