CAG busts myth of reduced tax disputes during 2018-19

by Yash Shah

The Comptroller and Auditor General (CAG) of India’s audit report with respect to the tax department, revealed that the number of disputes and also the amounts locked up at various forums, including the tribunals courts, have risen during the fiscal year of 2018-19. The amount locked up in appeal cases with CIT-Appeals was Rs.5.6 trillion in 2018-19 which was more than the Centre’s revenue deficit in the year, the CAG observed. CAG found that income-tax department had under-assessed income in a sample of scrutiny assessment cases, leading to a lower tax demand by over Rs.440 billion. The report points out to the lack of effective monitoring and absence of an institutional mechanism to respond to the systematic and structural weaknesses leading to revenue leakage.