SRINAGAR: The Income Tax Department in Srinagar has taken a stern stance against the fraudulent refund claims made by several individuals over the past few years. In a significant development, the department has lodged two First Information Reports (FIRs) against a Chartered Accountant and 405 others in bogus refund cases in Jammu & Kashmir.
Akash Kumar Meena, Income Tax Officer (Technical), Srinagar, filed the FIRs with the Crime Branch of Jammu & Kashmir Police under the direction of Principal Commissioner of Income Tax, Jammu-Kashmir and Ladakh, M P Singh. The FIRs were based on investigations carried out by the Income Tax Officer (TDS), Srinagar.
According to the FIRs, a total of 405 individuals, including a Chartered Accountant operating a firm in Raj Bagh Srinagar, have allegedly conspired to defraud the Central Government’s exchequer of Rs 16.72 crores between the financial years 2017-18 to 2019-20. The Income Tax Department, in the FIRs addressed to the Senior Superintendent of Police, Crime Branch, Srinagar, has provided detailed information about the modus operandi employed by the accused. This includes their complete personal details such as names, addresses, PAN (Permanent Account Number), bank accounts, and the fraudulent refund amounts obtained by filing incorrect Income Tax Returns covertly.
The accused are believed to have collectively obtained refunds exceeding Rs 4 lakh each through the submission of inaccurate Income Tax Returns over multiple years. All 405 individuals have been charged under Sections 420/468/471 and 120B of the Indian Penal Code (IPC) & RPC, along with Section 66-D of the Income Tax Act.
Reliable sources indicate that a Special Investigation Team (SIT) headed by Imtiyaz Ahmed, Deputy Superintendent of Police, Crime Branch, Srinagar, has been established under the orders of the Special Director General of Police (Crime), Jammu & Kashmir, to conduct further inquiries into the matter. It has been further revealed that the Crime Branch has seized all bank accounts associated with the accused individuals, and the investigation is currently underway.
Additionally, the Income Tax Department of Jammu & Kashmir has filed a complaint against CA Imran Amin Dara of Srinagar with the Institute of Chartered Accountants of India. In a letter dated 24th May 2023, Akash Meena, Income Tax Officer (Technical), has requested the Director Discipline of ICAI to revoke the said CA’s license.
In a related development, last year in November, the Income Tax Department of Jammu & Kashmir initiated an examination of refund claims made by taxpayers through bogus deductions. The analysis revealed a significant number of salaried employees in Jammu and Kashmir who had fraudulently claimed deductions under various sections of the Income Tax Act with the aid of middlemen. These individuals were government employees from departments such as PDD, health, tourism, education, police, J&K Bank, universities, and other belt forces.
In response to the Income Tax Department’s request, various departments within the Union Territory issued advisories in March, urging their employees to update their Income Tax Returns and file ITR-U if they had claimed bogus refunds. Reliable sources indicate that over 9,000 employees complied and updated their returns before the 31st of March, returning excess refund amounts to the government along with additional taxes totaling over Rs. 56 crores. However, it has come to the attention of the IT Department that many employees have failed to update their returns or reimburse fraudulently obtained refunds, including the accompanying additional tax penalties.
Reliable sources indicate that such individuals will face strict legal action in the coming months. Their cases are also likely to be subjected to scrutiny in the near future, potentially leading to the filing of additional FIRs against both employees and middlemen involved in fraudulent activities within the Union Territory of Jammu & Kashmir.
Speaking on the matter, a senior officer of the Income Tax Department, on the condition of anonymity, revealed that more than 20,000 employees of the Union Territory Government and over 8,000 personnel from various belt forces are under investigation for fraudulently claiming income tax refunds for the years 2020-21 and 2021-22, despite the filing deadlines having passed.
Principal Commissioner of Income Tax, M P Singh, emphasized that taxes paid by citizens are crucial for the development of infrastructure, including roads, bridges, tunnels, rail lines, schools, colleges, and hospitals. While the department appreciates honest taxpayers for their contributions to nation-building, it vows to take strong action against dishonest taxpayers and those who misguide the public, enabling tax evasion and bogus refund claims.
