28000 J&K Govt. Staffs under IT lens for claiming Bogus Tax Refunds

More than 28,000 government workers in Jammu and Kashmir, including 8,000 police and paramilitary force members, are under probe by the Income-tax department for allegedly claiming bogus refunds worth a few crores of rupees while submitting their ITRs, according to official sources.

The taxman discovered that the alleged fraud occurred during the Income Tax Returns (ITRs) filing seasons of 2020-21 and 2021-22, even though the department has filed two criminal FIRs with the J&K Police crime branch against a Chartered Accountant (CA) and 404 other people after a similar fraud was discovered in previous financial.

The alleged irregularities were discovered after the Tax Deducted at Source (TDS) wing of the department in Srinagar discovered that a number of people assessed in the Union Territory of J-K had claimed “excessive and ineligible deductions” under various heads, resulting in the claim of bogus refunds, according to sources.

According to documents obtained, the Principal Director of I-T (J&K and Ladakh) M P Singh authorised the filing of police FIRs against the CA and 404 other people, including some questionable tax advisors and filers, for “entering into a conspiracy and defrauding the exchequer of a sum of Rs 16.72 crore between the financial years 2017-18, 2018-19, and 2019-20.”

The department found that many among these people had filed incorrect or false ITRs and had identically claimed around Rs 4 lakh in refunds, they said. According to the sources, the department provided with the police the names, residences, PANs, and bank accounts of these 405 persons as part of the allegations that culminated in two FIRs filed on May 25, following which the crime branch froze these bank deposits.

These individuals have been charged under different sections of the IPC, including 420 (cheating), 468 (forgery), 471 (using a forged document as real), 120B (criminal conspiracy), and section 66D of the Information Technology Act (cheating by impersonation).

Sources Stated, the department has also written to the Institute of Chartered Accountants of India (ICAI) to request the termination of the accused CA’s licence, who owns a consultancy business in the Rajbagh district of Mumbai and is considered the “prime accused” in the case.