The Income Tax Department on Wednesday warned taxpayers that any attempt by them to alter their tax returns to reflect a much higher amount would invite the scrutiny of the Department and the possibility of prosecution.
"It is brought to the notice of tax payers that any instance coming to the notice of the Income Tax Department which reflects manipulation in the amount of income, cash-in-hand, profits etc. and fudging of accounts may necessitate scrutiny of such cases so as to ascertain the correct income of the year and may also attract penalty/prosecution in appropriate cases as per provision of law," the department said in a statement.
Under the existing provisions of section 139(5) of the Income Tax Act, 1961, revised returns can only be filed if any person who has filed a return discovers any omission or any error.
ADVERTISEMENT
"Post demonetisation of the currency on November 8, 2016, some taxpayers may misuse this provision to revise the return-of-income filed by them for the earlier assessment year, for manipulating the figures of income, cash-in-hand, profits etc. with an intention to show the current year’s undisclosed income (including the unaccounted income held in the form of demonetized currency in current year) in the earlier return," the statement said.
The statement further clarified that the provision to revise the returns was not for making changes in the income initially declared so as to "drastically alter the form, substance and quantum of the earlier disclosed income."