Income Tax Department Uncovers Rs 700 Crore Tax Fraud, Tightens Refund Check:

The Income Tax Department Fraud detection drive uncovers bogus medical and donation claims, with foreign assets and income reported.

I-T Department uses AI and data analytics to detect suspicious claims

Vanshika verma

Sep 20, 2025

Last update on Sep 20, 2025

Income Tax Department Uncovers Rs 700 Crore Tax Fraud, Tightens Refund Check Authorities from the Income-Tax Department have identified a Rs 700 crore tax evasion scheme involving fraudulent medical and donation claims. Many culprits were high earners using the old tax regime, with some continuously making suspicious claims. To flag suspicious patterns and frauds, the Income tax department is taking help from advanced data analytics and AI. As of September 17, 2025, this initiative has resulted in a 24% reduction in total refunds, declining from Rs 2.10 lakh crore last year to Rs 1.60 lakh crore. After an overall verification drive in July, a recent campaign led to over Rs 963 crore in fraudulent deductions being withdrawn and another Rs 409.5 crore collected in taxes as of June 18. Taxpayers also reported foreign assets worth Rs 29,208 crore and foreign income of Rs 1,089 crore. Now, the income tax department is tightening checks on big refunds – so if you're expecting more than Rs 10 lakh back, be ready for possible delays.

About Author

Vanshika verma

Content Writer

Vanshika Verma is a Content Writer with 1+ year of experience at Studycafe.in. A B.Com graduate from Delhi University, She writes articles on Finance, Tax, ICAI, GST, and the latest financial news, with a focus on making complex topics easy for readers and professionals.