In the past five years, the Central Board of Indirect Taxes and Customs (CBIC) has registered 106 cases of tax evasion involving a total of ₹7,581.8 crore against various insurance companies, according to the report the Finance Ministry submitted to the parliament. The Income Tax department has also begun taking action against these companies.
While responding to the MP V.K. Sreekandan about insurance companies being “under the scanner for rampant tax evasion”, the Minister of State for Finance Pankaj Chaudhary, approximately 1,347.2 crore has been recovered from cases involving indirect taxes involving Service Tax evasion before the introduction of the Goods and Services Tax (GST), non-payment or short payment of GST under the reverse charge mechanism, or availing of ineligible Input Tax Credit.
It was reported by a well known newspaperlast month that the IT department plans to crack down on firms after finding industry-wide irregularities and evasion.
The minister further stated that the Income Tax Department takes necessary action whenever any incident of tax evasion is brought to the attention, including performing searches and surveys, assessing income, levying and recovering tax, imposition of penalty, and commencement of prosecution… against such tax evader(s). Similar measures are taken in cases involving assessees from a variety of industries, including the insurance industry.
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