The income tax department has asked to submit the details of holdings in the unlisted companies, ET reported.
According to reports, the investors across the country are alarmed at the Income Tax Department’s move to seek details of investments made in unlisted companies in the tax return forms.
The income tax department has asked the individual assessees to provide the details of their investments in the private companies or directorship in such companies in the new tax return forms.
The report said that this has created concerns among many investors who fear that this may create taxation problems in the future.
Due to this, many of them are rushing to sell or transfer the shares and resign from the boards before they file their returns. They also fear that the IT department may scrutinize data and could start probes if they find any mismatch, the report said.
The move is on the light of reporting cases wherein it was alleged that many investors are manipulating balance sheets of unlisted companies to escape taxation.
As per the directive, the assesses must furnish these details for the last fiscal year ended on March 31. But many of the investors are likely to exit their holdings and board positions and avoid reporting those, hoping that the tax department wouldn’t closely scrutinize their returns.
