The Central Board of Direct Taxes ( CBDT ) issued a notification on 16th February 2023 related to sharing of information of the taxpayer with the Directorate of e-Governance of Tamil Nadu.
In accordance with Section 138(1)(a)(ii) of the Income Tax Act 1961, the central government published a notice in the official gazette instructing to share information about income tax assessees with the director of the Directorate of e-Government of Tamil Nadu in order to properly implement all federally sponsored programmes and welfare programmes.
According to section 138(1)(a)(ii) such officer, authority or body performing functions under any other law as the Central Government may, if in its opinion it is necessary so to do in the public interest, specify by notification in the Official Gazette in this behalf, any such information received or obtained by any income-tax authority in the performance of his functions under this Act, as may, in the opinion of the Board or other income-tax authority, be necessary for the purpose of enabling the officer, authority or body to perform his or its functions under that law.
Information about the taxpayer should be kept private. However, in accordance with section 138(1)(a)(ii) of the Income Tax Act, the government is permitted to notify the change through the official gazette before providing the necessary information to the appropriate authorities. The notification in the current circular solely applies to the state of Tamil Nadu. Hence it follows that such notification was demanded by the state government.
The notification made it quite clear that the information from income tax assessees will be used to identify the real recipients of centre and state-sponsored schemes. From the notification itself, it is clear that there are numerous income tax payment scams going on, and the government only wants to include the real ones in its schemes.
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