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ROUNDUP
INDUSTRY
NEWS
CBDT inks two more advance pricing pacts Service tax dept to have
The Central Board of Direct Taxes such agreements, of which 13 are uni- eye on five sectors
(CBDT) had entered into two unilateral lateral APAs and one is a bilateral APA.
advance pricing agree- The revenue department has de-
ments (APAs) on August, Unilateral APAs are agreed cided to focus on five key sectors,
3. These two APAs - en- between Indian tax payers including telecom and renting of
tered into with two multi- and the CBDT, without in- property, where the possibility of tax
national companies - in- volvement of the tax au- evasion is high. The sectors, accord-
cluding the first such thorities of the country ing to the Service Department, has
agreement with a 'rollback' provision. where the associated en- been identified as evasion prone in-
terprise is based. Bilateral APAs include cludes aviation operations, man-
The CBDT has so far entered into 14 agreements between the tax authori- power recruitment and security
ties of two countries. agencies, work contract and con-
struction.
CBDT to horn tax evaders with stringent penalty
The profiling is being done to help in
The Income Tax department has asked change their mindset from using service tax audit and scrutiny of re-
its officials to go beyond just raids and searches as a revenue augmenting tool turns, which earlier had resulted in
searches to target tax evaders. The to creating credible deterrence by sus- lower than expected growth in Ser-
CBDT in a recent missive vice Tax collection, the officer said.
to its field officials, has tainable penalties and
stressed the need to in- prosecution so that "po- Sector specific profiling would be in
still the fear of "incar- tential evaders desist from addition to the manual scrutiny of
ceration and consequent crossing the red line." service tax returns of assesses based
loss of liberty and social on risk parameters which has been
opprobrium" among tax According to an analysis initiated from August 1. The detailed
evaders by way of speedy prosecution on effectiveness of search manual return scrutiny would be
and penalties. and seizures conducted in conducted in respect of such as-
2005-06, 2006-07 and 2007-08, it was sesses whose total tax paid for 2014-
Further, the department has asked the found that the outlook of these coer- 15 is before Rs.50 lakh.
field staff to add at least 25 lakh new cive actions was "extremely poor" with
assesses every month - a stiff target by regard to prosecution and penalty The government has budgeted to
all counts considering that it is nearly sought. collect over Rs.2.09 lakh crore from
equivalent to the number of new as- service tax in the current fiscal, as
sesses added annually. Also, it was found that most of these compared to a growth of 25 per cent
cases were not prosecuted under Sec- over the last financial year.
The CBDT has told its officials to tion 276C(1)for willful attempt to
evade tax.
BANKING FINANCE | NOVEMBER | 2015 | 11
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