Income tax

3 Income tax clerks siphoned off crores through bogus TDS refunds; CBI probes

The scam surfaced when one of the valuation agents detected the calculation of refunds under Section 154 of the Information Technology Act.

The scam surfaced when one of the valuation agents detected the calculation of refunds under Section 154 of the Information Technology Act.

The CBI has opened an investigation against three Department of Income Tax officials for allegedly facilitating sham refunds of TDS deducted for multiple assessees by abusing access to the senior officer system, officials said on Sunday. .

The investigative agency filed the FIR based on a complaint by Joint Commissioner of Income Tax, Muzaffarnagar, against three Group C Income Tax officials who allegedly managed to dupe the department by allegedly misusing valuation agents’ RSA tokens to establish and generate fictitious Withholding Tax (TDS) refunds. RSA tokens are one-time, synchronous solutions that automatically change a user’s password every 60 seconds.

Following the FIR, the agency had searched several locations, they said.

The Central Bureau of Investigation (CBI) has named three IT managers – Abhay Kant, Saurabh Singh and Rohit Kumar – in connection with the case as well as nine beneficiaries of the refunds.

The tax service alleged that officials misused assessors’ RSA tokens to determine and authenticate the generation of fictitious refunds payable to 11 assessees, on the system, and obtained refunds worth more than 1 ₹.39 crore between August 1, 2020 and August 25. , 2021 until fraud is detected.

The scam surfaced when one of the assessors detected the calculation of refunds under Section 154 of the Computer Law for assessees who did not belong to his range, they said.

Orders under the section are made when a rectification of an order or treatment is required either at the request of the assessee or by the assessment officer alone where an error needs to be corrected, which is apparent in the records, he alleged.

These refunds would have been made on AST (Assessment Information System), an old system, and not on ITBA (lncome Tax business application) on which the process has now been moved since 2016. “Of the total amount diverted, almost Rs 35 lakh were deposited in the government accounts by the accused officials while the taxes against the Rs 22 lakh claim were recovered by assessing the officers through enforcement actions against the beneficiaries,” he alleged.

“A total recovery either from the staff involved in the scam or from the appraising agents by way of seizure of the accounts of the appraisees amounts to Rs 57.31 lakh so far. The total amount outstanding, including interest payable, is calculated at Rs 94.39 lakh,” the complaint alleged.