The government has decided to cross-check all high-value refunds in this financial year after e-mail accounts of some of its officers were hacked to generate refunds.
The Central Board of Direct Taxes (CBDT) said that an income-tax official in Mumbai noticed on January 12 that refunds had been issued from his jurisdiction without his knowledge or approval of his higher authorities.
The officer brought the matter to the notice of his senior officers. An internal inquiry by the Income Tax Department found that user identifications and passwords of certain officers had been fraudulently used to generate refunds in some cases.
Upon detection of the fraud, the department issued orders to stop payment, following which refund outgo in at least two cases could be prevented. Investigation and search action was undertaken by the Directorate of Income Tax (Investigation) in Mumbai to detect the bank accounts to which the refunds had been credited and the beneficiaries.
I-T investigators have identified the bank accounts, beneficiaries and some of the scamsters involved and the Mumbai police and CBI (Mumbai branch) have been informed, the finance ministry said in a statement.
“All high value refunds issued during the current financial year will be cross-verified. The system of handling high value refunds will be replaced with a more robust and foolproof system,” it said.
The I-T department has issued Rs 8,954 crore of refunds during the first nine months of 2009-10, up 49.76 per cent a year ago.