I-T dept flags 68,000 cases for mismatch in 2019-20 income tax returns

Central Board of Direct Taxes (CBDT) chief Nitin Gupta on Monday said that the income tax department has picked up as many as 68,000 cases for e-verification on account of underreporting of income in tax returns for fiscal year 2019-20.

Addressing media in New Delhi, Gupta said, “About 68,000 cases pertaining to 2019-20 fiscal have been taken up for e-verification on a pilot basis, based on risk management parameters set by the department. Of this, 35,000 taxpayers have satisfactorily replied to the notice or filed updated tax return. However, no response has been received in the remaining 33,000 cases.”

Gupta said a total of 15 lakh updated returns have been filed so far and ₹1,250 crore worth tax was collected. Taxpayers have time till March 31, 2023, to file updated returns for income earned in 2019-20 fiscal.

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Under the e-verification scheme of the I-T department, the taxpayers are intimated about mismatch in Annual Information Statement (AIS) about financial transaction and the I-T returns filed. Subsequently, the taxpayers can reply to the I-T department offering explanation for the mismatch or can file updated returns, if they feel the mismatch flagged in e-verification notice is correct.

“Once an assessee files updated ITR, there are less chances of his/her case getting picked up for scrutiny or re-assessment,” Gupta said. He disclosed that the risk parameters for picking returns for e-verification would be set every year. He, however, didn’t reveal the criteria for selection of an ITR for e-verification.

“The 68,000 cases picked up for e-verification was based on mismatch between tax return filed and the data received from source with regard to deposits. The selection is computer driven. If you do not respond to the e-verification notices, chances are high that the case would be selected for scrutiny,” Gupta said.

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“The e-verification scheme is a non-intrusive way to nudge taxpayers to file updated returns in case of mismatch. It is transparent, without any human interface, encourages voluntary compliance and would help cut down litigation,” said the CBDT chief.

With an aim to promote compliance, the e-verification scheme was notified on December 13, 2021, and pilot was launched in September 2022. The last date for filing updated returns for 2019-20 fiscal ends on March 31, 2023.