INCOME TAX

INSTRUCTION NO. 1899/1992

 Dated: September 2, 1992

The CBDT has been issuing instructions and guidelines for investigation under the I.T. Act, 1961 including in the cases of persons involved in irregularities/frauds relating to shares, securities, banking etc. Obviously comprehensive instructions covering all situations are not possible as a large number of cases involving unprecedented tax evasion have come to notice in the last few months.

2. Information regarding these persons is coming from a number of sources including reports in newspapers, magazines etc., F.I.Rs filed by the C.B.I. and enquiries conducted by R.B.I. particularly three reports of the Janakiraman Committee. It has to be noted that the cases of assessees involved in these transactions are spread over a number of assessing officers under Salary Circles, Business Circles, Central Circles etc. all over the country falling under the jurisdiction of several Chief Commissioners/Directors General and Commissioners. It may be stressed here that each assessing officer is also an investigating officer. He is expected to be receptive to information about his assessees coming from the various sources listed above and to take suitable action in these cases. It may not be possible for Investigation Wing to take up immediately and simultaneously enquiries/enforcement action in all such cases. At the same time, it may also not be possible for the Board to issue general guidelines in the group cases involved therein. In these circumstances, it is expected that the Chief Commissioners/Commissioners concerned would get the Income-tax files of such assessees examined thoroughly and a proper comprehensive background note would be prepared obtaining and taking information from all possible sources into account. They may also issue suitable instructions to the assessing officers for investigations under proper guidance of the supervisory authorities. In some cases the CCsIT/CsIT may feel that it is necessary for the Investigation Wing to look into the matter for proper action or that the connected cases require centralisation. In such cases, the matter may also be taken up with the concerned Director General(Inv)/Director(Inv)/D.D.I(Inv) who will no doubt take further suitable action. Needless to say that close co-ordination between the assessment wing and the Investigation Wing will need to be maintained to achieve the desired results in these cases.

3. The Board desires the CCsIT to take urgent action after identifying and locating such cases as are assessed in their regions. As the Joint Parliamentary Committee is looking into these irregularities/frauds, CCsIT may get the Income-tax/Wealth-tax profiles of the assessees in their regions prepared so that it may be possible to submit the required information to the Joint Parliamentary Committee at short notice if required. They may also report the progress of the investigations to the Chairman and Zonal Members in their monthly D. O. letters.