Wrong appointments affected prosecution in tax-evasion cases: CAG

CAG has pulled up Income Tax department for not posting appropriate officers to handle the cases of tax evasion

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The Comptroller and Auditor General of India (CAG) has pulled up the income-tax department for not posting appropriate officers to handle prosecution in cases of tax evasion. The CAG did a study on the administration of penalty and prosecution by the department between August and December 2012. "Our study revealed that due seriousness was not given for posting of a senior and experienced officer to the post of nodal officer, affecting the entire process of prosecution," the report said.

It found that officers ranging from the rank of ITO to the rank of Joint Commissioner IT were handling prosecution related matters and in many cases were holding additional or concurrent charges to the detriment of prosecution. The report said that posting a senior officer of Deputy Commissioner rank as Nodal Officer to handle prosecution related matters ensures one point contact for all round coordination with I-T department and interface with relevant authorities in the Economic Offences Court. "Absence of a Nodal Officer has affected reporting and thereby monitoring the prosecution process in the I-T department jurisdiction," the CAG said.     The report also found that the I-T department did not apply penalty as per the provisions of the I-T Act in cases such as non-complying with filing requirements covering I-T returns, concealment of income and failure to provide return for Tax Deducted at Source (TDS). The department did not apply penalty provisions for cash transactions which led to tax effect of Rs 56.60 crore, it said.