No scrutiny for taxable income above 100%

Advance tax dates to be extended to July 15, Oct 15 & Jan 15.

The government is examining a proposal to exempt from scrutiny all assessees who have declared a taxable income that is twice or more of the income filed in the previous year.

Finance Minister P Chidambaram has asked the Central Board of Direct Taxes (CBDT) to study the proposal after recommendations to this effect from chief commissioners of income tax. The proposal, if approved, would be announced in the next Budget, revenue department officials said.

The finance minister has also asked the CBDT to examine if the move amounted to a grant of immunity. Officials said suitable checks and balances should be built into the system to ensure that the provisions were not misused.

Officials said the proposal was mooted with the objective of increasing voluntary tax compliance and deepening the tax base as some individuals were not filing returns fearing scrutiny.

A similar scheme was introduced earlier, but was discontinued after a few years. The CBDT will also be looking at the reasons for the withdrawal of the facility.

Revenue officials said the Supreme Court had barred the government from introducing amnesty schemes, though the income-tax field formation had made many such suggestions during zonal conferences held across the country earlier this year.

The United Progressive Alliance government's Common Minimum Programme had identified unearthing of black money an important area of action and the Prime Minister's Office had also asked the revenue department to focus on it along with computerisation of taxpayer services.

The CBDT is also looking at readjusting the dates for payment of advance tax installments and bring them in line with the quarterly results declared by the companies.

It is proposed to extend the dates for advance tax by a month to July 15, October 15 and January 15, while retaining March 15 as the date for the payment of the final installment.

"This will allow firms to assess their tax liability better and the government will able to monitor tax collections more effectively," an official said.