The Central Board of Direct Taxes (CBDT) has issued comprehensive guidelines for the compulsory selection of income tax returns (ITRs) for complete scrutiny during Financial Year 2025-26. These instructions aim to strengthen the risk-based approach to tax enforcement and enhance monitoring of high-risk transactions and non-compliant taxpayers.
According to the circular dated June 13, 2025, the following key categories will be mandatorily selected for complete scrutiny:
Key Cases Under Compulsory Scrutiny:
1. Survey Cases (Section 133A): Assessees where surveys (except under Section 133A(2A)) were conducted on or after April 1, 2023.
2. Search & Seizure/ Requisition Cases (Sections 132 / 132A):
- Searches conducted between April 1, 2023 and August 31, 2024.
- Searches conducted between September 1, 2024 and March 31, 2025.
3. Cases with Cancelled Registrations/Approvals: Assessees claiming tax exemptions despite cancellation or non-grant of registrations under sections like 12A, 12AB, 35(1)(ii), and 10(23C).
4. Recurring Additions: Cases where high-value additions (Rs. 50 lakh in metros and Rs. 20 lakh in non-metros) were made on recurring issues of fact or law in previous assessments.
5. Tax Evasion Alerts: Cases flagged by enforcement or intelligence agencies with specific tax evasion information.
6. Notices Under Section 148 or 142(1): Where returns were not filed or where new information has surfaced post-search or survey.
Key Procedural Highlights
- NaFAC Role: Many of these cases will be processed through the National Faceless Assessment Centre (NaFAC).
- Transfer to Central Charges: Cases identified outside central charges must be transferred within 15 days of issuing notice under Section 143(2).
- Deadline for Scrutiny Notices: All notices under Section 143(2) for ITRs filed in FY 2024-25 must be issued by June 30, 2025.
International Taxation & Central Circles
These cases will be handled directly by respective charges without needing further communication with NaFAC.
The CBDT's directive serves to streamline scrutiny selection while upholding transparency and accountability in the tax administration process. Taxpayers and professionals are advised to review these updated parameters and ensure timely compliance.
Official copy of the notification has also been attached
CAclubindia
