5105/1992. - Income Tax - 5105/1992

INSTRUCTION NO. 5105/1992 Dated: October 20, 1992 Section(s) Referred: 143(2) Statute: Income - Tax Act, 1961 It is observed that the economic offenders have widened their range of operation to the international level. Various types of economic offences are committed by them with a view to evading taxes and duties under different fiscal laws of India. It has been noticed that the assessees receive bank drafts, cheques, gifts, loans etc. from their alleged relatives and friends through the modus operandi of hawala transactions. The importers and exporters use the device of under-invoicing and over-invoicing the bills in a big way. Benami firms/companies are floated abroad to facilitate illegal operations. These types of offences have been mentioned only as a matter of example. There may be many more methods being adopted by the economic offenders on a large scale. 2. It has also been observed that the Assessing Officers either accept the versions given by the assessees or make heavy additions in the assessments in a summary manner, without making deep investigations and without collecting sufficient documentary evidence to support the additions made. It is felt the Assessing Officers probably either do not have sufficient time to make deep investigations or they have hesitations to correspond with the Indian missions abroad. 3. In view of the position explained above, I would request you kindly to give necessary directions and encouragement to your Assessing Officers so that wherever they feel suspicious in respect of any transactions of the assessees with concerns or persons abroad, they may refer such cases to this Bureau alongwith detailed notes about the facts of each case. This Bureau will be pleased to render all possible assistance to the Assessing Officers in the matter of proper investigations and collection of relevant evidence so that additions made, if any, are sustained. [JS DDG's, Economic Intelligence Bureau, Delhi D.O. No. ADG(K)/L/92, dt. __.10.'92]