I-T dept sets up special cell to track ‘missing’ tax payers

The department has decided to send show-cause notices to those assessees, who have reported “no assets/inadequate assets for recovery”, by this month end asking why their names should not be published and put in the public domain

New Delhi: Stepping up measures to recover over Rs1,00,000 crore of unpaid taxes, the Income Tax (I-T0 department has set up a special cell to track tax payers who are ‘untraceable’ or have reported inadequate assets to pay back tax demands, reports PTI.

The department has also decided to search and approach every possible database or agency, ranging from the Registrar of Companies (RoC), Financial Intelligence Unit, banks to local police stations, municipal authorities and network of informers for any clue about such tax payers.

Various commissioners of the department across the country have also been asked to send quarterly reports of their areas in this regard to the special cell created in the recoveries wing of the department in the National Capital.

“The special cell will liase with all the I-T ranges across the country and obtain data from various government databases. The department will also sift information on such tax payers in its own databases like PAN card and 360-degree profiling,” a senior I-T official said.

The Central Board of Direct Taxes (CBDT) in June this year constituted a committee under Director General (Administration) to examine pending cases on I-T demands under the categories “assessees not traceable” and “no assets/ inadequate assets for recovery”.

According to the latest data, I-T demands have been pegged at Rs1,01,836 crore.

The constitution of this committee, which have senior I-T officials from various units including investigation and intelligence, is among the measures the government has taken to fight black money.

The I-T department has recently decided to publish the names of defaulters who owe more than Rs10 crore as unpaid taxes.

The department has decided to send show-cause notices to those assessees, who have reported “no assets/inadequate assets for recovery”, by this month end asking why their names should not be published and put in the public domain.

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RBI may again raise policy rates by 25 bps: Bankers

Although bankers have suggested the RBI to pause on its interest rate hike cycle to check deterioration in asset quality and fire up credit demand, there is little chance that the central bank will accommodate their requests as both food and headline inflation are very high

Mumbai: Faced with double-digit inflation, the Reserve Bank of India (RBI) is likely to raise its policy rate again in its half-yearly review of the monetary policy on Tuesday, reports PTI quoting bankers.

Although bankers have suggested the RBI to pause on its interest rate hike cycle to check deterioration in asset quality and fire up credit demand, there is little chance that the central bank will accommodate their requests as both food and headline inflation are very high.

“It is clear that inflation is high I believe that there be interest rate hike of 25 basis points (bps) by the RBI,” Central Bank of India chairman and managing director MV Tanksale told PTI.

Vijaya Bank chairman and managing director HS Upendra Kamath said, “My view is that to control price situation there would be continuation of monetary policy.”

The central bank has hiked interest rates by 350 basis points since March 2010 to deal with the persistent high inflation, including rising prices of food items. If the RBI raises rates, it would be 13th hike in a span of about 30 months.

IDBI chairman and managing director RM Malla said, “My own sense is that there could be a pause or hike of maximum 25 basis points by the RBI in its review of the monetary policy.”

The RBI is also confronted with a weakening rupee which puts further pressure on inflation. Besides, slackening industrial growth leaves limited choices for the RBI especially in view of difficult global economic environment.

The central bank has already hinted that inflation must ease before the central bank can reduce interest rates.

“We are deeply sensitive in making India a low interest rate regime but that will take time,” RBI governor D Subbarao had said earlier this month.

“First, we need to bring inflation down in order to bring interest rates down,” he had said.

While the food inflation has touched a six month high of 10.60%, the overall rate of price rise measured on the basis of Wholesale Price Index (WPI) is stubbornly close to double digit since December last year.

The headline inflation at 9.72% in September was a tad lower than 9.78% in August but way above RBI’s comfort zone.

A weak rupee is also adding to the inflationary pressure as it pushes up the landed cost of imported commodities.

India depends on imports to meet 80% of its crude oil requirement. It also imports a large quantity of vegetable oils and pulses.

Terming the food inflation situation as a matter of worry, finance minister Pranab Mukherjee had said “we shall have to ensure...the supply constraints which are the major reason for the food inflation how to tackle it.”

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Norms to ensure continuity in accounting practices: Finance ministry

After Pratip Chaudhuri succeeded OP Bhatt at the country’s largest lender SBI, its profit plunged 99% for the quarter ended 31 March 2011. Its profit was just Rs20.88 crore against Rs1,866.60 crore for January-March quarter of 2010

New Delhi: Concerned over the unusual steep fall in State Bank of India’s (SBI) profit for the March quarter after a change of guard at the helm, the finance ministry has said it is in the process of putting in place a mechanism to ensure continuity in accounting practices in banks, reports PTI.

The finance ministry is addressing the issue and is planning to lay certain guidelines, Department of Financial Services secretary DK Mittal said, adding that “the change of top management should not lead to rewriting of books and there has to be some continuity”.

“There is a need to have more scrutiny by somebody,” he said, adding that the change in guard should not lead to a significant change in the bank's balance sheet.

After Pratip Chaudhuri succeeded OP Bhatt at the country’s largest lender SBI, its profit plunged 99% for the quarter ended 31 March 2011. Its profit was just Rs20.88 crore against Rs1,866.60 crore for January-March quarter of 2010.

“If accounts are prepared wrongly then auditor is held responsible apart from officers. There has to be some accountability. It’s not that you rewrite the accounts and you are scot free...same chartered accountant is re-appointed and officers rewrite,” he added.

Earlier the Reserve Bank of India (RBI) deputy governor KC Chakrabarty had also said that there was a need for banks to improve the standards of financial reporting.

“See our banks, I see when the chairman retires the profits go down,” Mr Chakrabarty had said.

There is a need to improve both the standard of reporting as well as that of examination of account books, Mr Chakrabarty had said.

Mr Mittal said, “One decision which has been taken and implemented is that executive directors and chairmen of banks should join the respective banks at least 15 days before (the expiry of incumbent chairman’s or executive director's term) so that they are aware of the bank. They (designated person) know the bank’s policy and direction.”

“Many times these changes (discontinuity in the financial numbers) happen because they are not aware,” Mr Mittal said.

To begin with, last week, the finance ministry had directed executive director of Indian Overseas Bank (IOB) Nupur Mitra to join Dena Bank as the chairman and managing director (CMD) 15 days ahead of schedule.

She will take over as the CMD from DL Rawal, who will be retiring this month end.

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