Taxmen cannot ignore ‘brazen misuse’ of laws: Finance minister Nirmala Sitharaman

Mumbai, April 29, 2023

Finance minister Nirmala Sitharaman on Friday said there is evidence of “brazen misuse” of tax laws by some sections to claim unlawful refunds, and the use of deep data and artificial intelligence has revealed a trail of funds to shell companies.

“When these trails of funds going to shell companies are in your face, I do not see how the CBDT or CBIC can remain a mute spectator. That has to be plugged to ensure that genuine taxpayers do not lose faith,” she said.

The minister was responding to a question about increased search activity by the tax department during a fireside interaction at the Economic Times Awards for Corporate Excellence.

Sitharaman said about 300 shell companies, operating in a 50sqm area, with just one table and a chair, were getting refunds to the extent of 400 crore.

“If the tax authorities are going to fear being accused of tax terrorism, the inefficiencies will perpetuate,” she said.

[The Times of India]