Staring at revenue shortfall, I-T dept sends tax notices to mutual funds

Move comes after CBDT raised concerns over direct tax collection growth and directed I-T department to adopt measures to shore up revenue

The income-tax (I-T) department is nudging companies, especially mutual fund houses, to pay the dividend distribution tax (DDT).
 
This comes as the I-T department is staring at a shortfall in revenue collection.
 
According to sources, the tax department has issued notices to at least a dozen asset management companies (AMCs) that have reportedly announced dividends, but are yet to pay the tax.
 
“Notices are being sent to many domestic companies (both private and public sector firms), along with fund houses that are yet to deposit the DDT to the exchequer,” said a tax official in the know.