The Income Tax department in Andhra Pradesh has found that a large number of government and tech company employees have claimed incorrect tax deductions and exemptions. The department has said that these employees have been lured into claiming wrongful refunds by intermediaries and peers. The department has given these employees a chance to file the correct returns.
"Many of the assesees work in government departments, PSUs and prestigious IT companies. It is also noticed that a large number of such taxpayers work with companies based outside Andhra Pradesh and Telangana but have PAN based in Andhra Pradesh/Telangana," said a statement issued on Friday.
The Income Tax department's surveys on consultants and intermediaries revealed incriminating evidence on these fraudulent practices. Many of them have admitted to claiming bogus deductions and getting substantial refunds for their clients (employees and others) for commission, the statement added.
A good number of these claims have amounted to tax refunds as high as 75 per cent to 90 per cent of the Tax Deducted at Source (TDS) by the employer.
The tax officials have seized the records containing the names of the employees and clients who indulged in these malpractices.
The department has given a lifeline to file updated returns under Section 139 (8A) for the assessment years (AY) 2021-22 and 2022-23 to pay the taxes due under Section 140 B, including allowing revised returns filing for AY 2023-24 in case original return has already been filed.
The department has also said that it is conducting a wider investigation into the matter. It is possible that more employees may be found to have claimed incorrect tax deductions and exemptions. The department has urged all taxpayers in Andhra Pradesh to file their returns accurately and to cooperate with the department.
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