I-T to closely scrutinise foreign assets held by Indians

The drive initiated under the guidance of I-T apex policy making body -Central Board of Direct Taxes

The Income Tax department will carry out closer scrutiny of those tax statements wherein an assessee has disclosed that he or she holds bank accounts or any other assets abroad before the current financial year ends on March 31.

Sources said the drive has been undertaken by the department under instructions from its apex policy making body -- the Central Board of Direct Taxes -- which desires that the taxman should "examine all cases related to foreign assets" as a number of these will get time-barred by this month end.

The CBDT, in 2012-13, had introduced a new column in the Income Tax Return (ITR) forms which made it mandatory for individuals and other entities to disclose their foreign assets for the purpose of tax assessment.

"A number of cases will get time barred by March 31 this year. This means that the I-T department will not be able to take action in cases pertaining to 2007-08 assessment year where foreign assets or bank accounts are present and have been disclosed.

"Under the current crack down on black money, instructions have been issued to field offices to undertake a close scrutiny of such cases where the taxpayers have disclosed such assets themselves or I-T investigations or intelligence have indicated presence of such assets in the name of an individual or entity," a senior Finance Ministry official said.

The taxman has also been asked to obtain from the assessee information about the source of funds used for creating the particular asset or bank account in the foreign land and connected reasons thereof, the official said.

CBDT has also asked tax officials to collect all such information and send it across to its Foreign Tax and Tax Research (FT and TR) unit so that any possible cooperation on such cases can be sought from foreign countries "well in time".